Democracy Day: Taking Stock of Social Well-Being and Economic Freedom

Proshare

Tuesday, May 29 2018, 9:00 AM / Proshare Research

 

There is the danger of limiting democracy to just freely expressing oneself, performing the statutory responsibilities of choosing leaders and the existence of democratic institutions. 

Such danger becomes more prevalent when democracy is reduced to limiting the ‘Kakhi’ men to the barracks where as pondering issues that border on nation building is left unanswered. 

In specifics when the issues that revolve around life sustaining goods (food, shelter and protection), higher income and freedom to make economic and social choices fetter around unanswered. Obviously, there is an inherent fracture.  

We do agree that freedom is never a generation away, however growth and prosperity take a shorter period to be relinquished. , The lessons of 2015 and 2016 has reaffirmed such position, moreover the scars still linger.    

Democracy becomes tainted, when the citizenry is just muddling through their day to day activities with dimmer opportunities. Such scenario stray far away from the ideals of democracy because it has failed to provide social and economic equity. In such scenario economic is an illusion.  

Without an inch of doubt, democracy is every bit synonymous with opportunities. Besides what is the essence of   democracy without the ability to remove the barriers to trade, provide a level playing ground and create prosperity. 

After all that is why laws are passed and courts rain supreme. It best captures democratic structure as multi-enforcing towards the positive well-being of the people. 

Whatever the economic tendency, one pitches   the end game of every democracy is to unleash the nation’s potentials and ensure appropriate   income redistribution.   

Thus, democracy is considered to be thriving when it has lifted the people out of the obscurity of poverty to an up tilt of prosperity. Therefore, at every phase of each country’s democratic path.  

The conscious question of whether one is better off or worse off than before is frequently asked because it serves as the only genuine litmus test of democracy. More importantly, it reaffirms the fact, that the centerpiece of democracy is the social well-being of the people.  

More than ever before on our part,  we summon every bit of courage on this day to answer the famous question asked by the referred Ronald Regan.  “Are we better off than we were before both on the macro and micro level”?          

 Proshare Nigeria Pvt. Ltd.

 Source: Proshare Economy Desk

 

Takeaways

·         Exchange rate and  price stability have firmed up compared to the previous past

·         Oil price have recovered compare to the corresponding period

·         Foreign exchange reserve has improved on the heel of  improved oil prices

·     The  improved Dollar liquidity coupled with the introduction of the Importers and exporters  window have bolstered capital importation

·    Purchasers manger index have been on an expansionary path on the back of deceleration in output and input prices  

·         Credit to the private sector have remain sluggish due to the hawkish monetary policy.

·  Recently Nigeria grew at 1.92% at the end of the first quarter of 2018, certainly better than corresponding quarter of 2017: which was 

·      There have been a blistering in debt from N13.86 trillion from 2016 to N21.56 trillion in 2018 

·    Evidently quantitative variables have improved compare to a year ago, as improved dollar liquidity and backwardation in inflation

·         The introduction of the importers and exporters window coupled with reduce entry into the domestic money market by the fiscal side   has improved economic freedom

·     It is expected that the new CAMA legislation will improve the ease of doing business,  thus rub positively on the

·         Therefore what is the impact of quantitative growth on the house hold ? 

 

Fig 2: HDI

Indexes

Value as atToday

Population

185 million

Life Expectancy

53.1 years

Unemployment

18.8%

Under-employment

21.1%

Youth Unemployment

33.3%

Per-Capital Income

$2,450

Percentage of Working Poor (Living Below $3.10/day )

72%

People Living Below Poverty Line ($1.9/day)

53%

Source: Proshare Economy Desk

 

  • Even though inflation have receded and there is dollar liquidity there is largely a disconnect between the current growth and the standard of living of the ordinary Nigerian 
  • First off Nigeria qualitative indicators began a stall prior to the recession. There by the weakness in qualitative indicators have become more accented into the Human indexes of the nation after the recession. 
  •  Regardless of emerging from a recession  per capital income fell  from  $2,820 to  $2,450
  • Underlining the reality that the existing growth level can’t stall the dip in per capital income. 
  • 73 % of  working Nigerians  are considered to fall within the working poor and  53% of Nigerians live below poverty line
  • Two third of the chunk of Nigerian who are underemployed have a B.S.C degree. Thus majority of Nigerians are stuck in low paying jobs or are in   low skilled labor.  
  • Thereby underlining the income inequality witnessed in the economy

 

Conclusion

·   Even though the economy has stabilized compared to the past, however there is a need to address income inequality.

  • First of all, the quality of growth a nation creates captures the quality of job that are inherent in the economy.
  • Secondly any growth level that lag behind population growth has no impact on the living standards of an ordinary Nigerian.
  •  There is a need  to resolve lingering issues bordering on private public partnership, in order to drive  national income
  •  A more robust frame work with regards foreign exchange is inevitable, if Nigeria want to address issues of  income inequality,  paltry foreign direct investment and improve diversification
  • There is an urgency to further open up the economy especially with regards infrastructure.

 

Proshare Nigeria Pvt. Ltd.


Proshare Nigeria Pvt. Ltd.



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