Problems and Causes of Economic Underdevelopment in Nigeria

The problems of Nigeria economic underdevelopment are in fact the characteristics and causes of underdevelopment of the country. There have been several reported factors militating against the rapid realization of sustainable economicdevelopment objective in the country.

In this blog post, we shall be focusing on some specific problems of economic underdevelopment characterizing and causing continuous economic underdevelopment of Nigeria. These are succinctly enumerated below.

Inequality of Opportunities: This is one of the main problems peculiar to Nigeria causing economic underdevelopment in the country.

It is not necessarily true that most underdeveloped countries like Nigeria are not growing or developing economically, the development in most cases lack generalinclusiveness of the poor masses which consequently leads to dualistic economy of the haves and the have-nots, concentration of productive resources and income on the hands of the few privileged rich at the expenses of the poor masses.

The domination of Nigeria economy by the few opportune individuals in the country usually leads to exclusive economic growth and development. For there to be sustainable economic development in Nigeria, there must be general inclusion of the populace in wealth creation opportunities (finance, job, information etc.) and partake as well in the sharing of the wealth of the country.

In a study conducted to investigate how optimum distribution of opportunity could be achieved in Nigeria economy by Abiodun and Adeniyi, (2015) concluded that in order to arrive at an optimum distribution of growth opportunities, the government must redistribute the available opportunities to the poor;

Findings also show that the poor has neither really participated in the growth process nor benefited from the country’s growth experience even though Nigeria was one of the economies in the world that experienced consistent positive economic growth rate between 2004 and 2015, the economic growth has not been inclusive enough.

High Poverty Rate: This is another characteristic and visible cause of economic underdevelopment in Nigeria; the reduction of extreme poverty has remained a major policychallenge of Nigeria and many developing countries around the world.

Though, extreme poverty has declined significantly, it remains a major challenge especially in Africa as nearly 1.2 billion of people around the world continued to wallow in abject poverty even as these countries reached the end of the MDG period in 2015 (Mela, Okafor  and Elijah, 2015).

The United Nations Millennium Development Goals Report, (2015) revealed that, although the number of people living on $1.25 per day reduced from 47 per cent of 1.9 billion in 1990 to 14.0 per cent or 836 million people in 2015, a lot remains to be done to totally eradicate extreme poverty by the year 2030.

There are several factors responsible for high poverty rate in Nigeria; these factors ranges from technological backwardness, inequality of opportunities (the poor are usually located in remote localities and regions of a country, with low physical and social services), high rate of unemployment, low savings etc.

The persistent high poverty rate as caused by the above factors can be fully illustrated and understood with regards to viscous cycle of poverty; low income leads to low savings, low savings leads to low investment, low investment subsequently leads to low income and low demand for labour (thus low unemployment) which consequently leads to low demand for firms output in the economy.

High poverty rate in Nigeria has led to several undesirable economic development challenges; high poverty rate goes hand in hand with illiteracy, poor standard of living, corruption, vices etc.

Problem of Policies Implementation: Economic development planning has long formed part of economic development strategy, after the First World War, countries planned on how to best optimize their available scarce resources for rapid economic resuscitation.

Due to the enormous result attained by these countries during the period and following the political independence of the underdeveloped countries, they follow suit in economic development planning to solve many of their economic development challenges.

The effort made by Nigeria in development planning cannot be said to have yielded appreciable results due to problem of policy implementation.

The problem of successful economic development plans implementation in Nigeria arises from factors ranging from lack of sufficient and accurate information, finance inadequacy, political upheaval (e.g several military rules in Nigeria before finally realizing uninterrupted democracy from 1999-date), lack of consultation (especially with those for whom the plan are directed to), unrealistic target, inadequate man-power etc.

Subsistence Agriculture Production: This is another serious problem of economic development peculiar to Nigeria and causing economic underdevelopment of the country; a country that is not self-reliance in food production is not economically viable and cannot compete successfully with other countries as the case with Nigeria.

Eneji, (2014) enumerated five (5) problems affecting the agriculture sector of most underdeveloped countries; these problems have also contributed to the persistent economic underdevelopment status to include land scarcity, lack of credit facilities to farmers and diversion of the same if in existence to retired generals, civil servant and serving senior civil servants;

others include lack of storage facilities, obsolete application of agriculture technology and practices and marketing problems associated with diversion of gains from sales of agriculture produce by middlemen.

High Rate of Population Growth: Nigeria like many underdeveloped countries of the world are characterized by high population growth rate caused by factors ranging from high level of illiteracy and socio-cultural believes (e.g the prestige of having many children and the notion of procreation for the purpose of future dependency) with their negative implications on the economy.

The high level of population growth rate in Nigeria leads to over population especially if the positive rate of economic growth and development is not in correspondence with the population (and it is not in most cases). Over population of course leads to economic underdevelopment as the result of over utilization and break down of public utilities like water, roads, electricity, recreation centre;

It also leads to development of slumps and poor sanitary environment which often results to poor health conditions of the citizens and consequently increasing government spending in the health sector, over population also leads to widespread social vices in the society because of resources scarcity and insufficiency.

In conclusion, we have seen that the problems of economic underdevelopment in Nigeria are equally the characteristics and causes of economic underdevelopment in the country.

This implies that, economic policies makers and development planners in solving the problems of economic underdevelopment in Nigeria should strive on transforming the characteristics of economically underdeveloped countries peculiar to the country.

References:

Abiodun O. Folawewo and Adeniyi Jimmy Adedokun, (2015). Distribution of Opportunity and Inclusive Growth: Evidence from Nigeria. A paper prepared for the Nigerian         Economic Society’s (NES) 56th Annual Conference on Attaining Inclusive        Growth in Nigeria: Challenges and Prospects scheduled for 12-15 October,     2015

The United Nations Millennium Development Goals Report, (2015). The United Nation    Development Programmes.

Eneji Mathias Agri, (2014). Agro-Industrial Base for Nigeria’s Entrepreneurship Development.     Entrepreneurship and Poverty Reduction in Nigeria. Universal Academic.

Mela Y. Dogo, P. N. Okafor and Elijah A. P. Udoh, (2015). A paper prepared for the Nigerian     Economic Society’s (NES) 56th Annual Conference on Attaining Inclusive Growth in Nigeria: Challenges and Prospects scheduled for 12-15 October, 2015