FORMER Deputy Governor of the Central Bank of Nigeria, Kingsley Moghalu, has criticised Africa’s focus on Gross Domestic Product (GDP) growth, describing it as a “misguided worship” that has hindered the continent’s development.
In a post on Saturday via his X handle, Moghalu, a former presidential candidate, argued that true development must start with an African-centric mindset, that places emphasis on education and skills for productivity.
He also called for a shift towards reliable power infrastructure, and the integration of scientific innovations into the marketplace.
He stressed the need for accessible capital to support Small and Medium Enterprises (SMEs) and Micro, Small and Medium Enterprises(MSME), through microfinance, without direct central bank funding.
“A misguided worship at the altar of GDP growth has stunted Africa’s development. The first business of African development is developing an endogenous mindset (worldview) of African development.
“Second, a strategy for overcoming poverty anchored on effective education and skills for productivity.
“Third, ensure the availability of electric power infrastructure, and fourth, channel scientific inventions and innovations into the marketplace through mass production.
Also, ensure access to what I call “pipeline capital” to the bottom of the pyramid – SMEs, MSMEs etc at affordable interest rates through microfinance banks (task for central banks, but NOT central banks themselves directly funding ),” Moghalu wrote.
His perspective came amid the recent fall of Nigeria’s Gross Domestic Product (GDP) dropping to 2.98 per cent in real terms.
The 2.98 per cent is lesser than 6 per cent annual growth promised by President Bola Tinubu at his inauguration on May 29, 2023.
According to the latest data by the National Bureau of Statistics (NBS), although the GDP is higher than the 2.31 per cent recorded in the first quarter of 2023, it is lower than the fourth quarter of 2023 growth of 3.46 per cent.
NBS said that the performance of the GDP in the first quarter of 2024 was driven mainly by the services sector, which recorded a growth of 4.32 per cent and contributed 58.04 per cent to the aggregate GDP.
Findings from the report showed that crop production, trade, and information and communication services contributed almost 50 per cent to the GDP than other sectors.
The ICIR reported the promise of the president, while giving his inaugural speech on May 29, to increase Nigeria’s GDP by six per cent annually.
Experts had told The ICIR that President Bola Tinubu was unlikely to achieve his target of increasing the country’s GDP rate to six per cent annually.
Regarding real GDP per capita, The ICIR calculation shows that each Nigerian contribution to the GDP growth is around N12.5 over the projected 228.54 million people. The decrease in the GDP might not be unconnected to the rising inflation rate which climbed to 33.69 per cent in April from 33.20 per cent in March 2024.
Usman Mustapha is a solution journalist with International Centre for Investigative Reporting. You can easily reach him via: [email protected]. He tweets @UsmanMustapha_M