The warning by President Muhammadu Buhari that African Central Banks must not accept fit-for-all-purposes prescriptions handed down from abroad as they address the continents current economic challenges could not have come at a better time. Speaking at a recent meeting of the association of African Central Banks in Abuja, the president urged African apex banks to continue to look for innovative home-grown solutions to fix the continents troubled economy. The major challenges crippling most African economies include slowdown in growth; weakening global demand; rising inflation; restrictions in capital flows; rising debt levels; increased exchange rate volatility and depleting external reserves.We believe that countries such as Nigeria, Angola, South Africa and Mozambique that rely on natural resources managed along the lines of IMF/World Bank economic models need to rethink their economic systems. Just a few decades ago China, now the second biggest economy in the world and a major trade and business partner to a number of African countries, was at par with these countries before it remodelled its economy.Clearly, monetary and fiscal policies imposed by the Bretton woods institutions on developing countries over the decades have not been sufficient to bring about a desired economic growth. The result of the Structural Adjustment Programme (SAP) of the 80s has been nothing but steep decline in standard of living and overall increase in poverty levels with the attendant socio-political crises. Even Western countries have never fully adopted these policies. For example, in 2008, the US resorted to unconventional monetary policy by providing so-called stimulus packages for the automobile, housing and banking industries. In the European Union zone, state subsidies for agriculture are among the highest in the world.The Buhari administrations economic diversification programme aimed at drastically cutting down on excessive reliance on oil to ensure self-sufficiency and massive employment for millions of the youth is a right step in this direction. Similarly, the Central Bank of Nigeria had in recent years, spearheaded economic stimulus measures through specific intervention programmes targeting critical sectors such as agriculture and manufacturing. These are areas where Nigeria has high comparative advantage both continentally and even globally.The next logical step is to embark on export and production diversification targeting value-addition and a shift away from raw material exportation. These require huge investments in infrastructure especially energy, power and transportation. For instance, through the abandoned trans-Sahara highway, Nigerian products can access markets in the west, north and central African regions. This will give a huge boost to millions of agro-based industries and other small and medium scale enterprises with potential to absorb millions of unemployed youth across the country.The government does not need to engage in direct running of businesses to achieve this. It should just continue to focus on providing the enabling environment especially policy stability, security and the rule of law. In this regard, the twin wars against corruption and terrorism must be carried to its conclusion and without further waste of time. Apart from reducing corruption and insecurity to the barest minimum as well as repatriating looted funds, efforts must also be intensified to stem the illicit outflow of funds from the country.In our opinion, economic independence for Nigeria and other African countries can only become sustainable if citizens are fully carried along. In this wise, governments must enlighten the people on the real causes of financial instability and economic challenges. These one-drug-for-all-ailments packages have always failed to take cognizance of the peculiarities of our economic environment.
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