Why Nigeria Must Let Some Industries Die – Prof. Iyanda
If Nigeria’s economy must make meaningful progress and create the much-needed jobs, then the economic managers must have the courage to let some industries die.
That is the view of Professor Olukunle Iyanda, who is the Chairman of Council and President of Nigeria Institute of Management, NIM.
In an exclusive interview with Bounce News on Wednesday in Lagos, Prof. Iyanda said Nigeria should adopt a deliberate strategy that would encourage certain industries to thrive, while sacrificing others where the comparative advantage is lacking.
He said he believes such strategies will strengthen Nigeria’s economy and prevent it from hemorrhaging and shedding millions of jobs because businesses are shutting down.
“We have to be selective in our industrial expansion. I have made this point a long time ago, that we should let some industries die,” Prof. Iyanda stated.
“Industries where we do not enjoy comparative advantage, where all our input materials are coming from abroad and our value added is nil or very little, such industries do not have what we call diffusion effect,” the renowned Business scholar explained.
He continued: “For example, you want to be producing motor vehicles. Do we have the technical skills, the input factors? We just go and bring all the components and assemble them here. the value added is not much.
“But there are industries where we enjoy a potential in terms of being able to do it at a very reasonable cost. For instance, the agro-based industries, processing anything that comes from our land.”
According to him, such industries include the oil and gas and agricultural sector where Nigeria enjoys abundant local input.
He said: “We need to focus on the petrochemical industries. We have the raw crude oil but we don’t do anything about it. We have Cocoa, but we don’t produce chocolate. Switzerland that has no cocoa produces chocolate.
“We have maize, but we import cornflakes. We grow rice – we all grew up on Ofada rice - but we are the largest importer of rice from Thailand. If we process our rice, maize and crude oil, these are huge industries that we can specialize in and we can use the money to buy those things that we cannot make economically.”
He insisted that Nigeria must “be selective in the industries which we encourage. Agrobased industries should come first for us. We are good at it.”
He added that the only way to create jobs is to encourage those industries where Nigeria has a better potential.
“And we have a very large population. Our domestic market is the biggest advantage that we have. That is why all the talks about dismembering Nigeria will not help us because, we are going to lose one of the biggest advantage that we have, which is the large size of our domestic market,” he said.
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