By Mike Adeyemi
As the global pandemic continue to ravage countries around the globe, discussion on the viability and liquidity of states across the country, has assumed the front burner. Thanks to the ongoing Coronavirus and volatility of prices of crude at the international market which has seen to the steady decline of resources accruing to states, there has been increased competition of the dwindling allocation for execution of projects.
Kwara State is however not insulated from the bleak financial climate hovering around many states in the country and except it joins those that can think outside of the box, exploit its local economy and tax regime to rejig and improve its local economy to achieve an equilibrium status for its workers and the government in the disbursement of wages and resources, there might be problem ahead.
But in order to holistically appraise Kwara economy outlook for the year viz-a-viz its formal and inform sectors, explore and utilize its diversification potentials in the areas of agriculture, solid minerals and other human and natural resources, a newsletter, Ecokwanomy was recently launched in the state to provide insightful analysis and exploration of the enormous prospective avenues available to the state and its citizens to not only survive beyond the pandemic but evolve a matrix that many other states can domesticate in the areas of wealth creation and sustainability considered very critical in ongoing narrative of states viability in the country.
The newsletter, published by the immediate past chairman of the Kwara State Internal Revenue Service (KWIRS), Prof Murtala Awodun, is a must read for the economic sector participants, economists and policy formulators on how to identify the goldmines in Kwara economy to make the state liquid and well prepared to face its financial obligations in the coming months.
The 12-page publication, comes in a glossy presentation, all coloured with rich infographs and relevant pictorial representations to dissect and proffer solutions to Kwara’s economic transformation and will form part of our rich business package weekly. Don’t miss the exciting series.
Sustainable economic growth depends on ability to invest as well as efficiently utilise economic wealth at one’s disposal. The most accurate measure of a country’s financial progress is the measure of its Gross domestic product.
This is because this measure does not contain the effects of inflation. The measure of economic growth is in the increase in the production of goods and services, spending, output and national income.
It is subject to many factors such as increase in population, cultural models, infrastructure, Government policies and utilisation among others. However, when economic growth rises, there is increase in job opportunities, production of goods and services as well as general standard of living.
Over the years, the economy of Ilorin, the commercial capital of Kwara State has evolved. At first, Ilorin was mainly a center for trading. This brought about migrants into the city who then began to specialize in other crafts such as cloth weaving, pottery, blacksmithing and wood carving.
These informal sectors sustained and developed the economy of the capital as well as the State. The informal sector of the economy is often regarded as the ‘shadow economy’ as it produces the most self employed workers who are often not reflected in the state or country’s employment statistics.
However the informal sector is highly productive and makes significant contribution to the state’s income. Opportunities for investment exists in these areas in the form of agribusiness, manufacturing and mining.
In recent times, the goal has become to achieve the maximum economic advantage. Although Saad, (2013) claims that the initial introduction of the taxation system brought about economic hardship for the citizens of the state, the generation of internal revenue became fundamental for the sustenance of the new Government administrative structures.
The government has become responsible for providing basic amenities in order to achieve economic goals and as oil money was no longer sufficient to sustain the nation, each state had to generate income to sustain themselves.
Since the advent of the Kwara Internal Revenue Service, internally generated revenue has reached an all-time high. This is significant as the more the internally generated revenue, the more financial freedom a state can attain to boost their economy.
Since the advent of the corona virus pandemic, the economy of Nigeria generally has been quite unstable. Within the state, the consequences have been a decline in wages, investment, savings and investment, unemployment and closure of business.
As the pandemic has imposed some restrictions on movement, Kwara that is known for its thriving Agricultural sector is likely to experience an impeding decline in crop production except measures are taken to protect the farming majority; keep supply chain active and cushion the challenges of the pandemic.
As at 2018, Kwara was said to have a Gross Domestic Product of $3,742,563,051 with a working population of 2.1 Million and a total population of 3.4 Million. The state was ranked with the other states taking into account each state’s activities of 2018 against 47 different socioeconomic indicators in five categories.
They include economy, education, financial health, healthcare, and living standards. At 2018, Kwara had a predicted economic growth rate of 0.6% as opposed to its -2.80% of 2017.
Amongst the 36 states of the federation, the state ranked 23 in education, 22 in financial health, 18 in healthcare and 22 in standard of living. The strongest economics in the nation were ranked using the following parameters: Business environment.
Economic growth and labour, Kwara ranked 8th. This shows that the state has great prospects if rightly governed.
Taking a critical look, it is evident that as the global economy has been threatened and unstable especially in regions where the virus is not under control, the economy of Nigeria and Kwara is bound to reflect such instability.
This may also affect the economic growth rate in long run. However, one can still see that the overall economy of the State has greatly evolved and is progressive. It is important to note that growth and development are continuous and there is no peak.
By Mike Adeyemi