Citizens of Nigeria’s oil-rich Niger Delta, the region that produces the petro-dollar that contributes the most to the budgets of Nigerian governments, may vehemently disagree with the opinion that Lagos is the goose that lays the country’s golden egg, and therefore deserves a special status for greater financial and infrastructural investment from the federation account.
And they will indeed have a point.
Revenue from the sale of Niger Delta’s petroleum is so strategic to Nigeria’s government financing that former President Olusegun Obasanjo’s government established the Excess Crude Account to warehouse overage of revenue above the benchmark price assumed for the Federal Government’s annual budgets.
Nonetheless, it is important to note that whereas America’s real sector, the oilfields, farms, and industries, are in other regions of the US, New York City, home of the investment bankers, is the country’s economic nerve centre.
Yet, maybe New York is not quite the best example to illustrate the economic importance of Lagos to the Nigerian economy. Lagos has the highest concentration of industries in Nigeria, and will soon be joining the league of crude oil producing states.
Here is the thing: Lagos, which would have been the seventh biggest economy in Africa, were it a country, has a Gross Domestic Product of $136 billion, and a four per cent growth rate, whereas Nigeria, the biggest country in Africa, has a GDP of $446 billion and a 2.8 per cent growth rate.
That means that Lagos, one of the 36 states of Nigeria, contributes about 30 per cent to the Nigerian economy. One would have thought that that was a good reason to pay more than a cursory attention to Lagos.
Both the Lagos Port Complex and Tin Can Island Port handle more than N382 billion, or about 70 per cent, of imports into Nigeria. Other ports, in Calabar, Port Harcourt, Eket, Delta, and Onne, handle the balance 30 per cent of the N530 billion imports, if you extrapolate.
A staff of the Nigerian Port Authority, formerly based in Eket, argues that the multinationals that import most of the consumer goods, industrial raw materials and machinery, and other supplies, into Nigeria, prefer to use the Lagos port.
This, he explains, is because of the deep shoreline of Lagos harbour, higher assurances of security to human life and property in the South-West, and easy access to their company premises, and near immediate distribution throughout the South-West that has consumers with Nigeria’s highest effective demand.
The argument for the big consumer market in the South-West is in unconfirmed reports that more than 70 per cent of petroleum products – petrol, diesel, kerosene, black oil, aviation fuel, all lubricants and greases – are consumed in Lagos, Ogun, and Oyo states of the region.
The figures of the returns of value added tax are another pointer: If you go by the revelation by a former Minister for Finance, Kemi Adeosun, that Lagos State contributes 55 per cent of Value Added Tax revenue, it would mean that, of the N1.17 trillion VAT revenue realised in 2019, the state contributed about N644 billion.
And, it would stand to reason that besides those engaged in peasant arable farming, Lagos, with its concentration of manufacturing and service industries, is providing a lot of employment for Nigerians, in addition to remitting huge Personal Income Tax revenue to the state government
But if you would consider the social costs, in crime, drugs, and disrupted family lives, that would have occurred if those engaged were unemployed, you will realise that Lagos State is standing in the gap for the bumbling Federal Government in more ways than one.
If you haven’t guessed where this discourse is going, you need to come to terms with the argument that it is time for Lagos to assume its rightful position of a special status, which wily military dictator Ibrahim Babangida promised when he moved the Federal Capital Territory to Abuja.
Those who think the measly N10 billion that the President, Major General Muhammadu Buhari (retd.)’s regime gave to the Lagos State Government, to combat the coronavirus pandemic is a big deal, must understand that the money was given out of enlightened self-interest.
The President just revealed that Lagos State accounts for 54 per cent of confirmed cases of coronavirus in Nigeria. You also recall that the coronavirus index case, an Italian, was discovered in Lagos State, though he was traced to Ogun State. In any case, he was brought back, and managed in a Lagos State isolation centre, before he was discharged after he got better.
Of the total of 6.35 million domestic and international aviation passengers that passed through Nigerian airports from January to June 2019, 3.43 million, or 41.07 per cent, passed through the Murtala Muhammed Airport complex. Most of those who are, or will likely be, first exposed to coronavirus will be travellers using the airport complex in Lagos.
You may also add that most of the diplomats, Nigerian and expatriate staff of multinationals, foreign and local businessmen, and the horde of underworked, but overpaid, Nigerian politicians and other public office holders, frequently travel in and out of the Lagos airport complex – for international and domestic flights.
You may have observed that even those hypocrites, who make political hay by shooting down the idea that Lagos State deserves a special status, and special consideration for infrastructural investment, own prime property in Lagos, from where they derive extortionate rental revenue.
If you check the directory of freehold, and leasehold, properties in Apapa, Victoria Island, Ikoyi, Lekki and satellite towns like the industrial districts of Kirikiri, Oshodi, Ikeja, Ikorodu, and the slums of Ajegunle, Okokomaiko, and Iganmu, you will be shocked at both the ethnic and political profiles of these fellows.
Those who think Lagos should have a special status may not be on the same page as former President Obasanjo, who thinks that Lagos is a “concrete jungle,” and is therefore unworthy of a special status. Unconfirmed rumours say Obasanjo assumes that posture, to spite Obafemi Awolowo, Western Nigeria’s first Premier, who thought that Abuja was unnecessary.
In accounting lore, an asset is expected to provide future streams of income. That justifies the argument that the Federal Government should invest in infrastructural assets to enhance the ability of Lagos to generate even more tax revenues for the federation account, to finance the infrastructure and social projects of Nigeria’s multi-tiered governments.
So, priming Lagos to achieve higher prosperity, and deliver more buck to the common kitty, is actually helping all the governments of Nigeria to deliver the greatest good to the greatest number of Nigerians. You would have thought that was obvious.
Those who seem not to understand why you need to further push the capacity of Lagos State to yield higher tax revenue to the federation account, and also provide more jobs, do all Nigerians grievous harm.
Those who think that Lagos is surfeit with development, and doesn’t need any consideration for more, should meditate on the following submission of Chuck Yaeger, American World War II pilot, who first flew an aircraft to break the sound barrier: “You don’t concentrate on risks. You concentrate on results. No risk is too great to prevent the necessary job from getting done.”
Not to enhance the capacity of Lagos to absorb those unemployed out-of-town young men roaming Lagos streets is to invite grave social consequences.
