SDN brought together private and public sector leaders in December 2020 to review our forthcoming report on economic recovery of the Niger Delta from the COVID-19 pandemic lockdowns in 2020. The private and public sector leaders agreed that the key challenges to economic recovery are:
- High rate of unemployment in Rivers State, partly caused by high rate of redundancy amongst workers directly or indirectly employed in the oil sector.
- Lack of state government support for job creation and economic diversification.
- Difficulty in doing business e.g. complicated administrative processes.
- Inadequate preparedness and response to the pandemic.
- Lack of access to loans and grants for small and medium sized enterprises.
- Increased rate of insecurity from robbery, cult violence, and kidnapping.
Federal and state government are best placed to address these challenges. This also reflects a recent World Bank report that notes the speed, quality and sustainability of Nigeria’s economic recovery will be determined by the effectiveness of its government’s response. However, the collapse in international oil prices—following the global economic slow-down—has reduced the Nigerian government’s spending power needed to respond to some of these domestic economic challenges as oil makes up 80% of the country’s export, 50% of the government’s revenue, and 30% of banking-sector credit. Therefore, the government response at both national and state-level must be made in collaboration with the private sector, to protect livelihoods of the poor and vulnerable. The Rivers State government can also focus on reviewing policies to improve the ease of doing business such as removing duplicate and contradicting bureaucracy and increasing clarity around taxes and registration.
Some of the key recommendations made for accelerating economic recovery in the forthcoming report are:
- Health sector reform: to enhance the government’s preparedness and response to the pandemic, including:
- Training and retraining frontline health workers on public health pandemics and epidemics e.g. COVID-19 and Ebola
- Timely payment of salaries and allowances to frontline health workers to maintain their motivation and sense of feeling valued.
- Provision of testing kits, personal protection equipment (PPE), hand sanitiser, and potable water at health facilities, isolation centres, and public places such as markets, schools and motor parks.
- Economic diversification: is particularly needed in agriculture, aquaculture, tourism and hospitality, information communication technology, and entrepreneurship. The Rivers State government needs to support, for example by:
- Expanding electricity grid access and other infrastructure needed for business.
- Access to micro loans for small businesses.
- Increasing successful start-ups through tax holidays, subsidised loans, and grants.
- Business support: For the government to sustainably recover from the COVID-19 impacts on the state, there should be a pool of fund that would be accessible to micro, small, medium and macro businesses in the state. The fund should be structured in recognition of the State Constituencies as represented in the House of Assembly; the beneficiaries should be identified in collaboration with LGAs and community leadership structures in the state. The purpose of the fund would be for improvement and expansion of existing enterprises, and attraction of more investment to the Rivers State.