Nigeria behind on meeting NDG's

from Guardian Newspapers

This is an examination of the factors that make it difficult for Nigeria to meet the Millennium Development Goals. It blames corrupt government for not using oil proceeds to benefit all of Nigeria. - Kale

By Bukky Olajide

THE achievement of Millennium Development Goals (MDGs) by 2015 will require a need for countries to grow their respective economies especially in education and health sectors.

MDGS, a programme designed to halve the proportion of poor people in the world to be achievable between 1990 and 2015, has influenced development benchmarks around the world, with nation's evolving various strategies to achieve the goals.

It is a programme by which all countries of the world, rich and poor have agreed to participate.

The MDGs, as it is, addresses those issues that are common to all nations especially in the areas of health and healthy habits.

Therefore, apart from the fact that achieving MDGs by countries would require an open, rule-based global economy, it will also require the cooperation of member countries in the areas of good governance that will translate into a sound national economy.

The 2008 World Development Indicators (WDI) a publication of the World Bank in conjunction with its numerous partners recognises governance as the performance of public officials and the quality of government institutions as an important determinant of development success.

But to understand how governance, good or bad affects development, it must be measured, said the World Bank, in ways that are sensible to politicians, citizens and others responsible for improving governance.

Therefore, the World Bank defines governance as the way public officials and institutions acquire and exercise authority to provide public goods and services, including education, health care, infrastructure and a sound investment climate.

Accordingly, bad governance is often equated with corruption, as corruption is the abuse of public office for private gain and is an outcome of poor governance, reflecting the breakdown of accountability.

Talking about types of governance indicator, the report examines rules indicators that attempt to establish the presence or absence of rules and processes.

That is, whether countries have laws guaranteeing the right to information, whether they have independent anti-corruption commissions and whether budget documents are published.

For instance, bad governance also includes long time required to resolve dispute in court, inability to provide security against crime and inefficiency of the tax system.

However, the WDI reasons that many countries of the sub-Saharan Africa might not be able to achieve the MDGs because poverty rates still remain above 40 per cent, raising concerns of widening inequalities among regions.

In the last decade, said the report, poverty reduction was not always commensurate with income growth, saying that in most low income economies and regions, inequality worsened, as poor people did not reap the fruits of economic expansion, lacking opportunities to do so.

The report observed that in working towards the achievement of the MDGs, the worst performers include a large number of sub-Saharan countries.

The World Bank also observed that great public spending is not associated with better outcome in these countries and this has resulted in the impoverishment of citizens.

According to the report, while poverty is a static concept, vulnerability is a dynamic one. Vulnerability reflects a household's resilience in the face of shocks and the likelihood that a shock will lead to a decline in well being.

Thus, depending primarily on the household's asset endowment and insurance mechanism, usually, poor people have fewer assets and less diversified sources of income than the better off, therefore, fluctuations in income affect them more.

And this is where microfinance comes in: Enhancing security for poor people means reducing their vulnerability to such risks as ill-health, providing them the means to manage risk themselves and strengthening market or public institutions for managing risks.

The tools include microfinance programmes, old age assistance and pensions and public provision of education and basic health care.

Achieving the MDGs also involves participating in international treaties on environmental issues.

According to the report, in many countries, efforts to halt environmental degradation have failed primarily because many governments have neglected to make this issue a priority.

The World Bank also stresses a direct relationship between governance and growth arguing that a determining factor in development was the effectiveness of the state concerning infrastructure, the report notes that the quality of an economy's infrastructure, including the power and communications, is an important element in investments decisions for both domestic and foreign investors.

Therefore, for instance, an economy's production and consumption of electricity is a basic indicator of its size and level of development.

Expanding the supply of electricity to meet the growing demand of increasingly urbanised and industrialised economies without incurring unacceptable social, economic and environmental costs is one of the greatest challenges facing developing countries.

Also, the report states that while access is the key to delivering telecommunication services to people, if that service is not affordable to most people, then goals of universal usage will not be met.

Concerning environmental sustainability the report adds that access to improved water sources and emissions of carbon dioxide are among the indicators that the international community uses to monitor progress toward environmental sustainability.

According to the report, economic activity, agriculture and industry in particular with human needs for access to water sources. But greater wealth and urbanisation allow more of the population to connect to safe drinking water networks.

Also, since diseases an environmental degradation do not respect national boundaries, access to reliable supplies of safe drinking water and sanitary disposal of excreta are two of the most important means of improving human health and protecting the environment.

On taxation, the report classifies taxes in six major groups; namely, income, profits and capital gains, pay roll and workforce, property, goods and services, international trade and transactions and other taxes.

Rich countries, however, rely more on direct taxes believing that direct taxes tend to be progressive, while indirect taxes are proportional.

Direct taxes are taxes levied on the income and profits of individuals and corporations while taxes and duties levied on goods and services are classified as indirect taxes.

On the enterprises surveys of investment climate, the report states that improving government policies and behaviours is a key to shaping the investment climate because they are influential in driving growth and poverty reduction.

According to the report, firms in developing countries have constraints in policy uncertainty, which measures the credibility of governments and their policies and the ability to deliver on promises.

Corruption -the exploitation of public office for private gain -can harm the investment climate in several ways as it can distort policy making, undermine government credibility, tax entrepreneurial activities and divert resources from public coffers," the report states.

"Robbery, fraud and other crimes against property and against the person undermine the investment climate," the report states.

It, however, states that most countries have room to improve regulation and taxation without compromising broader social interests.

Therefore, the investment climate is harmed when government impose unnecessary costs, by increasing uncertainty and risk by erecting unjustified barriers to competition.

Improvements in the tax system may include broadening the tax base, simplifying tax structures, increasing the autonomy of tax agencies and improving compliance through computerisation.

According to the report, when financial markets work well, they connect firms to lenders and investors, which allow firms to seize business opportunities and grow their businesses.

But too often, it says government distortions introduced by state ownership or directed credit undermines financial sector development, productivity and economic growth.

Looking at the world by income, Nigeria is classified among the low-income group.

In Nigeria, economic growth, which should be a distinct indication of development, has not yielded positive results. The porous and lopsided system has not allowed the poor people to enjoy the fruits of the country's abundant natural resources.

While Nigeria is a nation with enormous resources and possibilities, it was driven into poverty and wretchedness, because it lacked leaders to put these resources into good use.

Nigeria is in this sorry state because of the fact that right from inception, the leaders have formed the habit of diverting the huge earnings of oil into private pockets.

With every opportunity to make lives easier for the citizens because of the huge resources at their disposal, the successive Nigerian leaders did not undertake industry-based projects that would have freed the country from the shackles of imported goods.

And when they establish such good projects, they are never executed to the level of completion as successive governments keep on deviating from the projects initiated by the previous governments, thereby leading to a waste of abundant resources.

Speaking recently on governance, a former vice president of African Development Bank (ADB), Mr. Bisi Ogunjobi observed that there was a strong correction between the quality of a country's governance and the success in achieving growth and improving the quality of life of the population.

Ogunjobi said that good governance was used in a generic sense to encompass the quality of leadership in its capacity to govern effectively, the consistency of policies and the efficiency of institutions in providing qualitative public good and social services for the majority of citizens.

Therefore, he said, good governance must at the minimum, include accountability of those in government to the governed, transparency, due process and rule of law as well as a political system that allows for popular participation in the decision making process of selecting the leaders.

"Failure to meet these principles results in corruption and mismanagement of national and public resources as well as political exclusion leading to inability," he said.

Talking about corruption, the former vice president said that corruption symbolised a breakdown of ethical and moral values of systems and institutions of government.

According to Ogunjobi, corrupt practices take many forms, including embezzlement of public funds, theft or illegal use of public property, bribery of official to obtain favours, state or regulatory capture by private firms and bribery to influence procurement decisions.

"Corruption has devastating effects on the productive use of resources and economic development. It violates public trust and corrodes social capital while having far reaching effects on the allocation of resources and hinders service delivery. Corruption undermines the authority of state," he said.

Strangely enough, he said further that the phenomenon of corruption in Nigeria was aided in view of the incidence of high level of corruption by the leaders that combine abuse of office with greed and insatiable acquisitive appetite.

Ogunjobi said further that corruption created uncertainty about the rules and regulation of business, leading to poor economic environment for investment, while it hurts the poor in society by increasing the cost of service.

According to him, corruption also depressed economic growth, resorting in further limiting economic opportunities, encouraged lawlessness and organised crime eroded the moral and ethical standards of society and engendered social exclusion and marginalisation which led to regional conflicts.

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