The rapid rise in poverty in Nigeria as a result of oil shortages and rising inflation has accelerated the adoption of a new industrial strategy for Nigeria’s economic growth and prosperity. Additionally, the Debt Management Office (DMO) reports that as of December 2021, Nigeria’s debt reached N39.55 trillion.

DMO Director General Patience Oniha said it was our total external and internal debt. These borrowings come from several sources, including Eurobond, Sovereign Sukuk and Federal Government Bonds.

Our total debt to GDP ratio is 22.47%. The debt ratio is still below the 40% limit set by Nigeria. Meanwhile, campaigning has begun for the presidential election, which in February 2023 will draw the curtain back on eight years of Buhari nepotism, the day before Nigeria sleepily edged closer to a banditry disaster. President Buhari had overseen two economic crises, soaring debt and a calamitous increase in kidnappings, banditry – the only thing you would have thought a former general could control.

We desperately need a leader whose energies are not directed towards preserving his own privileges, but towards providing public goods – solving the impasse in education by paying the debts owed to the Union of Academic Staff of Universities, health and social protection; the rule of law by releasing Nnamdi Kanu and Sunday Igboho. Other issues awaiting resolution include terrorism, uninterrupted power supply, roads and digital infrastructure. We need a leader to eliminate distortions in the wage structure and the removal of subsidies that disrupt entrepreneurial activity.

Large-scale unemployment is one of the reasons our moribund industrial strategy needs to be refined. Industrialization is the process by which an economy moves from agrarian production to manufacturing. As a country transforms into an industrial society, manual labor is replaced by mechanized mass production. Like today’s advanced societies, we must break the vicious circle of underdevelopment.

Before Nigeria’s oil boom, we thrived on agricultural products that were exported for foreign currency. It has contributed over 57% of our GDP; while solid minerals such as coal, iron, tin and columbite contributed more than 15% to gross domestic product. Unfortunately, the discovery of oil changed that as minerals were neglected in favor of oil and gas. Consequently, the Nigerian economy has become volatile due to fluctuations in the price of crude oil. In fact, the recessions that Nigeria has experienced are attributable to the fall in oil prices.

In 1986 we were forced to borrow money from the International Monetary Fund (IMF) due to falling oil prices in the world oil market. Also in 2014, the continued decline in crude oil prices led Nigeria to experience another economic recession, largely caused by weak growth in China, which is the world’s largest importer of crude oil. Yet in 2016, the onset of the most recent economic recession, which was the result of shale oil extraction in the United States as the biggest buyer of Nigerian crude oil.

Since 2020 after the outbreak of the COVID-19 pandemic, crude oil prices have sold below $40 per barrel. Nigeria’s economy is in a coma, with runaway inflation raging, which has been further aggravated by the scarcity of foreign exchange, worrying debt and mass unemployment. All of this has sparked cheers for diversifying the economy and refining an industrial strategy to cater to the many unemployed.

Currently, the media is abuzz with reports that Nigeria’s major oil companies are leaving Nigeria due to divestment in favor of cleaner energy. In the words of NNPC Group Managing Director Mele Kyari, “oil companies are leaving because they want to move their portfolios to where they can add value and also contribute to the net zero carbon commitment.”

The Paris climate accord set a climate target that by 2050 global warming should have been reduced to 1.5C, while the Columbia Climate School said keeping global warming below 2C above industrial levels means that about a third of oil and 80% of coal reserves must remain unused by 2050. In another report, the International Energy Agency said that no cars to fossil fuel is not expected to be sold beyond 2035. This means that a country like Nigeria, whose economy depends on oil, faces bigger economic problems. charges due to its specialized economic structure.

Unfortunately, the Russian-Ukrainian war is catastrophic for Nigeria if proper measures are not taken. Nigeria enjoys good bilateral relations with Russia with trade of N994 billion. Reports show that Nigeria is a major importer of various agricultural and mechanical products from Russia and Ukraine. According to Bloomberg, Russia is set to ban some exports following sanctions it receives from other countries for its invasion of Ukraine.

The implication of this is that there will be a reduction in the supply of many commodities in Nigeria, which will increase the rate of inflation in Nigeria. The new preferred industrial strategy is threefold. Instead of wasteful and irrecoverable loans currently given by the Central Bank of Nigeria, such as merchants’ money; there should be a 50 billion naira loan scheme for SMEs without collateral, without interest. Second, another 50 billion naira loan program should be earmarked for import substitution industries. Finally, the Nigerian Enterprise Board should be constituted to record, monitor and implement government policies regarding the recovery of these loans.

It has been observed that the bulk of Nigeria’s manufacturing industry is in consumables such as food, beverages and tobacco. This supports the recommendation of the London School of Economics that Nigeria should adopt a new industrial strategy if it hopes to meet the need to create an additional five million jobs per year for the next 10 years. Without these privileged measures, Nigeria is threatened with disintegration in the near future.

Nigeria needs import substitution industries more than ever, as imports fuel unemployment. The lack of economic diversification has put the Nigerian economy at risk. Let states exploit the resources of their territory for their own survival. It is incumbent on the states and the federation to exploit its industrialization opportunities by promoting a value-based economy, which drives the conversion of raw materials into finished goods before export. Nigeria needs a manufacturing strategy that works that can absorb our many unemployed to prepare the country for the high quality skills that are needed in the modern age.