The Naira’s Decline: Why Nigeria Must Prioritize Productivity Over Consumption.

Nigeria's greatest challenge is not the decline of the naira or the scarcity of dollars, it is simple lack of productivity.

The Naira is in freefall. Its value has plummeted, leaving Nigerians facing skyrocketing prices, shrinking purchasing power, and economic uncertainty. For too long, Nigeria’s economy has been built on a precarious foundation: a dependence on oil exports and a voracious appetite for imported goods. This imbalance continue to drive the Naira down, and without a radical change, it will continue to lose value. The reality is stark, but the solution is within reach.

To restore the strength of the Naira, Nigeria must shift its focus from being a consumption-driven economy to one that prioritizes productivity across all sectors. This will require strategic reforms and investments, a commitment to diversify beyond oil, and a new way of thinking about how the country can leverage its immense human and natural resources.

The new mantra for Nigeria should be "Productivity all the way"

Productivity vs. Consumption: Understanding the Core Issue

Nigeria’s economic model has been fundamentally flawed. The country imports everything from food to electronics to tooth pick, and despite having the capacity to produce much of what it consumes, local industries have struggled to compete with cheaper foreign products. This dependence on imports has depleted foreign reserves, increased the demand for foreign currency, and caused the Naira to fall against major currencies like the dollar.

Our new national policy must wholeheartedly prioritize local production while driving an aggressive push to export, especially focusing on processed and finished goods.

Any society where corruption is more than productivity there will never be prosperity.

Meanwhile, the country’s main export — crude oil — has been a double-edged sword. While it brings in foreign revenue, over-reliance on this single commodity has left Nigeria vulnerable to fluctuations in global oil prices. When oil prices dip, so does the economy. It’s a cycle that has played out time and again, with devastating effects on the Naira’s value.

The solution is clear: Nigeria needs to produce more, export more, and import less.

Revamping Agriculture and Manufacturing: The Key to Diversification

Nigeria's agriculture sector has the potential to be a game-changer. Once the backbone of the economy, it has been neglected in favor of oil, but the tides can turn. The country has vast arable land, favorable weather, and a large workforce. Yet, most agricultural practices remain outdated, inefficient, and unable to meet the nation’s needs, let alone compete globally.

To truly revitalize agriculture:

- Introduce Modern Farming Techniques: The government should subsidize farming equipment, fertilizers, and seeds, and offer training programs that teach farmers how to improve yields. The focus should be on mechanization, irrigation, and better crop management.

- Build Processing Plants: Exporting raw agricultural products means missing out on added value. If Nigeria processes cocoa into chocolate or palm oil into cosmetics locally, it can earn more from exports and create jobs at home. A strong agro-processing sector can drive economic growth and help stabilize the Naira.

- Facilitate Access to Markets: Farmers should have easier access to both domestic and international markets. Government initiatives can promote Nigerian produce abroad, while local supermarkets should be incentivized to stock and promote homegrown goods.

Manufacturing must also take center stage. Countries that have succeeded economically have done so by building strong manufacturing bases. Nigeria has the raw materials, the labor force, and the market size to support a thriving manufacturing sector, but a lack of infrastructure, high production costs, and inconsistent government policies have held it back.

The government needs to create:

- Industrial Parks: With access to reliable power, water, and transport, these parks can help local manufacturers scale up production. Imagine clusters of textile, automotive, and electronics factories working seamlessly together, supplying goods to Nigerian markets and beyond.

- Tax Incentives for Manufacturers: Local manufacturers should receive tax breaks and easier access to loans. When businesses can save on taxes and access affordable financing, they’re more likely to invest, expand, and create jobs.

Labor Law Reforms: Productivity Begins with Fair Employment

Another major issue stifling productivity is Nigeria’s outdated labor laws. The minimum wage does not reflect the economic reality, and workers are paid monthly, which means many live paycheck to paycheck, struggling to make ends meet. To boost productivity and improve economic stability, Nigeria must rethink how its labor market operates.

- Adopt a Biweekly Payment System: More frequent pay can ease financial stress for workers and stimulate consumer spending, which will drive economic activity.

- Introduce an Hourly Wage System: Paying by the hour means businesses can hire more flexibly, especially during peak production times, and workers are compensated fairly for the work they put in. This system also incentivizes efficiency, as workers earn more by being productive.

- Regular Minimum Wage Reviews: The government should institute a system that adjusts the minimum wage regularly, based on inflation and economic conditions. This ensures that workers are not left behind as the cost of living rises.

Youth Employment: Unleashing Nigeria’s Greatest Asset

The youth make up more than half of Nigeria’s population, yet youth unemployment remains at a staggering high. This is not just an economic issue but a ticking time bomb. The energy, creativity, and drive of young Nigerians can be harnessed to fuel the economy if given the right opportunities.

No thriving economy relies solely on a single source of GDP growth. To achieve lasting prosperity, a nation must deliberately and consciously boost productivity across both oil and non-oil sectors.

- National Skills Development Program: Create a network of vocational and technical training centers across the country. These centers can teach young people valuable skills like coding, plumbing, digital marketing, and agriculture. The goal is to equip them with the tools they need to become self-reliant or get well-paying jobs.

- Support Start-ups and SMEs: Young entrepreneurs need more than just motivation; they need funding, mentorship, and a business-friendly environment. Low-interest loans, grants, and tax breaks for start-ups can encourage innovation and business creation, leading to more jobs and a stronger economy.

- Encourage Tech and Entertainment Sectors: Nigeria’s tech industry is growing, but it needs more support to become a global hub. The same goes for the entertainment industry. Nollywood and the Nigerian music scene have captured global audiences, but investments in these sectors can help them reach new heights.

Building a Collaborative Framework: Local, State, and National Efforts

For any strategy to succeed, it must be implemented across all levels of government. Local governments can play a key role by supporting small businesses and farming cooperatives. State governments need to invest in infrastructure that supports industry, such as reliable electricity, roads, and water systems. The federal government must create cohesive policies that remove bureaucratic hurdles, protect investors, and ensure that funds for development projects are used efficiently.

Why It Matters: Reclaiming Nigeria’s Position in Africa

Nigeria has the potential to be the economic powerhouse of Africa. It has the largest economy on the continent, a young, vibrant population, and an abundance of natural resources. Yet, these advantages mean little if they are not harnessed effectively. By adopting a national productivity strategy that prioritizes agriculture, manufacturing, fair labor practices, and youth empowerment, Nigeria can regain control of its economic destiny.

A stronger, more productive Nigeria means a stronger Naira. It means less dependency on imports, more foreign currency inflows, and ultimately, a better quality of life for millions of Nigerians. If the government can muster the political will to implement these changes, Nigeria can stand tall as the most developed economy in Africa, with a sustainable GDP that sets it apart from its peers.

The time for half-measures and quick fixes is over. It’s time to rebuild the foundation of the economy, brick by brick, sector by sector, until the Naira is no longer seen as a symbol of decline but as a sign of resilience and strength.

The country’s destiny is not written in the stars but in the hands of its people. By embracing productivity, by empowering its youth, by building on its strengths, Nigeria can reclaim its place as the Giant of Africa. The Naira can rise again, and with it, the hopes and dreams of millions of Nigerians. It’s time for a new chapter, one where productivity, innovation, and unity drive the nation forward.