Why Nigeria Isn’t Ready To Lead

There has been a great deal of attention paid to the rise of Nigeria as of late.  Indeed, it is hard to ignore the impressive economic growth rates being posted at a time when most economies are on the decline. The government appears focused on improving government services and investing in high potential growth areas of the economy.  President Goodluck Jonathan’s recent Transformation Agenda is an impressive document that many economists and analysts believe is setting the conditions for Nigeria to become the dominant economy on the African continent.  The agenda emerged in 2011 out of a belief by President Jonathan that the government needed a sense of direction and a way to ensure the country’s development priorities were applied with continuity, consistency, and commitment – the so-called “3Cs”.

Such analysis of Nigeria’s trajectory is further understandable given the current distribution of economic and political power in the region. Today, there are three regional nodes of economic and political influence in Sub-Saharan Africa: South Africa, Nigeria, and Kenya.  These three markets are the dominant players and generally act as hubs for continent-wide trade and commerce. They are also important interlocutors within their regions and across the continent via the African Union. Traditionally, South Africa has been the most dominant of the three, taking on leadership roles within the African Union and often representing the continent in international institutions like the United Nations Security Council. South Africa’s dominance in this respect continues, but many are now arguing that its position atop the hierarchy of African states is being economically threatened by Nigeria.

The tenor and tone of South African reactions to Nigeria’s rise have been particularly interesting.  In tenor, there has been a mix of surprise and apprehension. The supposed decline of South Africa has made great fodder for journalists and become a source of real criticism of the Zuma administration’s handling of the economy. The largely negative tone of the reactions suggests that it is popular to view the development of the continent as a zero sum game. 

But what I find particularly remarkable about all the analyses is their failure to consider the political economy of Nigeria as a whole.  Indeed, much of the contemporary analysis of Nigeria appears to gloss over, forget, or intentionally ignore some of the important structural issues that still confront it.  I don’t mean to downplay the significant economic growth that Nigeria is experiencing, or of the plans to fix its problems – all of these are good things. However, it really is too soon to claim that Nigeria is posing any threat to the dominance of South Africa on the continent.

Whilst Nigeria is a hub for the movement of goods, South Africa’s capacity and infrastructure are still superior in many respects. A recent study coming out of the South African Institute of International Affairs, argues that geography and infrastructure make a real difference to economic growth potential.  The study notes that South Africa still maintains a geographic advantage and advanced infrastructural capacity, ranging from deep-sea ports to container activity to strong logistics capacity, and that it is where many multinational companies have chosen to locate their headquarters. The study also warns that other countries are finding ways to improve market share of trade activity in Africa. All of these findings are correct, but the logical jump to assuming South Africa’s decline and Nigeria’s rising dominance implied by these sorts of studies leaves me feeling skeptical for the following reasons:

First, even in light of Nigeria’s strong economic growth, its GDP is still far less than that of South Africa.  In fact, we are talking about $164 billion less.  Not an insignificant sum for two developing countries.  Nigeria’s GDP currently sits at $244 billion whilst South Africa maintains a GDP of about $408 billion. With Nigeria’s annual growth rate of 7% that is an extra $16 billion coming into the Nigerian economy next year, and assuming growth continues on par as projected, this will have a compounded effect. In this context, it is going to take more than ten years for Nigeria to catch up with South Africa’s economy, which is also growing at a (albeit more modest) rate of 3%.  This is a far lengthier period than the 2014 prediction made by some analysts, so it is quite possible that the economic fortunes of either state could change significantly.  Indeed, it is believed that South African growth rates could increase if problems with labour unrest in the mining sector are resolved.  This is entirely plausible if the Zuma administration negotiates a mutually acceptable plan with its union partners currently in the governing alliance.  All this takes is political will.

So, Nigeria’s transition into dominance will be reliant on current growth rates, oil prices, and education investments remaining the same for the next ten years.  This scenario doesn’t take into account any shifts in macroeconomic conditions or natural fluctuations in markets.  As well, it assumes that Nigeria can solve some real challenges it faces with its business environment, primarily that of capital flight and corruption.  Indeed, Nigeria is ranked 131 out of 185 countries as a place to do business and has stayed in the same spot for the past two years. In contrast, South Africa’s business environment has improved in the past year – it is now ranked 39th globally, a two spot jump from the 41st position that it maintained last year.

Nigeria remains rife with corruption despite efforts by the government to address it.  Continentally, Nigeria is ranked 27 out of 53 states in terms of being a non-corrupt environment; internationally it is ranked 139 out of 176 countries, according to Transparency International.  In contrast, South Africa ranks seventh within the region and 69th globally for non-corruption.  Corruption in Nigeria is really a systemic issue and the challenge of tackling it cannot be underestimated; to do so would require sustained support from continental and international partners.

The rise of Nigeria will also be dependent on its ability to address socio-political challenges. Longstanding civil conflict due to insurgent groups, and struggles to put in place safeguard measures to protect human rights will also prevent Nigeria from becoming the dominant player on the continent.   These challenges are real and if not addressed, will detract from Nigeria’s ability to assert its dominance through the use of force or through moral persuasion.

Political stability in Nigeria is still a major issue.  Adding to the existing political divisions between the people in the North and South of the country are the threats that insurgent groups such as Boko Haram and Ansaru pose to stability.  Indeed, the national and local level governments appear to be struggling to contain these groups that are committed to destabilizing the North and East and to undermining important development work such as the vaccinations against Polio. Civil conflict brought on by these insurgent groups and their effectiveness at undermining the authority of the state and instilling fear in the local population poses a real challenge to Nigeria’s rise as sorting out internal matters will divert attention and resources for engaging in regional or international issues.  Nigeria’s inability to take leadership in intervening in regional conflicts to date, like Cote d’Ivoire and Mali, only highlight the difficulty it faces in projecting leadership outside of its borders. While it is expected that Nigeria will participate in stabilizing Mali through the provision of troops, its slow response has been surprising given its leadership role in the regional economic community of ECOWAS. South Africa, which is a reluctant intervenor in African conflicts, has committed $23 million in humanitarian aid and police training.  

Finally, the Nigerian government continues to grapple with respecting human rights.  Amnesty International recently released its annual report on Nigeria that notes the continuing prevalence of extrajudicial killings, enforced disappearances, forced evictions, and unlawful detention.  As well, rights for the LGBTI community continue to be hindered as homosexuality is still illegal in Nigeria and the president is planning on signing the Same Sex Marriage (Prohibition) Bill that was passed by the Nigerian Senate in 2011.  All of this impacts Nigeria’s ability to act as a moral actor on the continent and internationally.  South Africa, on the other hand, continues to be a moral actor as a result of the strong human rights provisions within its constitution and the existence of a constitutional court that effectively upholds those provisions.

When considering the “rise” of countries, it is important to remember that influence and dominance are also determined by other socio-political conditions than just the economy.  The political reality of Nigeria includes real efforts to improve economic conditions in the country but also persistent problems that, if left unresolved, will undermine its ability to influence and dominate in Africa.  In this light, it is important that one-dimensional analyses based on economic growth figures be tempered and contextualized against the challenges the country faces.