Nigeria: Rich Country, Poor People By Nasir Ahmad El-Rufai

By Nasir Ahmad El-Rufai

If President Goodluck Jonathan had had the courage to publicly declare his assets and that of his wife, the venerable Dame Patience Jonathan, it would have been possible to use Nigeria’s first family to undertake an assessment of the incidence of poverty in the country and explore why one of the richest countries in the world has some of the poorest people. While we await the president on this matter, one needs not travel too far to see evidence of poverty; just look around.

Though Nigeria’s population is three times that of South Africa, our economy is second to theirs in Africa. We are the 37th largest economy in the world, and 11th in terms of labour force (about 48 million, according to 2010 estimates). So how come we are one of the most impoverished countries in Africa and the 25th poorest in the world? Global average income is about $25 per person per day, or $9,000 per annum. In Nigeria, about half of our citizens live under $2 a day – on the threshold of poverty.  Two-thirds of the population lives under or around $1.25 a day – in extreme poverty. This is because our economic growth since Independence has bypassed the poor. Reviewing global Gini coefficients which measure income inequality within nations, Nigeria is one of the most unequal nations in Africa and the world. And like many other resource-rich nations, our 'enclave growth' has not led to sustainable job opportunities. This means that our so-called economic growth only benefits a narrow band of Nigerians – whether under dictatorships or democratic rule.

While our economy grew, the incomes of the poor have not, even with the new minimum wage. This is especially true of the rural and urban poor who together, account for much of Nigerian poverty. At current rates, it is estimated that by 2015, Nigeria will have more poor people than India and China who have more than a billion people each. In contrast, China and India have lifted more than 600 million out of poverty in the last twenty years of economic growth. In fact, the World Bank includes Nigeria in the list of top 15 places with the highest incidence of poverty. Of our 162 million people, 90 million live below the poverty level of $2 a day, despite billions of dollars in oil revenues.

In 1980 only an estimated 27 percent of Nigerians lived in poverty. By 1990, it had grown to 70 percent. In 2010, over 58 percent of our population lived under the new poverty threshold of $1.25 a day. Though unevenly distributed across Nigeria, poverty is higher in north east and less evident in the southwest. An analysis of public investments in infrastructure and human capital in the north-east would explain why the region is not only home to flawed elections and economic hopelessness but the Boko Haram insurgency as well. Indeed, most of the apparent ethnic and religious crises in the north, and the youth violence and criminality in the south can be linked to increasing economic inequality and hopelessness due to governance failures!

Nigeria’s poor are in two distinct groups: the working and non-working population. Poverty is prevalent in both rural and urban areas, though large numbers of rural folk constantly migrate to urban areas in search of work. This is not unconnected to the fact that typical households in rural areas only cultivate 1 hectare of land annually which is only capable of producing about N80, 000 worth of food crops. From this, the household may earn N80, 000 ($500) or N219 per day, for a family of 6-7 people. Each member of that family lives on approximately N32-37 per day. Supplementary income from cattle, fishing or other wage labour, does not amount to much. 

The urban poor – mostly uneducated and unskilled migrants from rural poverty – only have their physical bodies as capital. Urban wages may be higher than the rural, (for the same kind of work, urban wage rate can be 50–100% higher), but workers sometimes end up poorer because most of their meager earnings is consumed by the higher costs of living. With the new minimum wage, the typical urban poor earns between N18,000-20,000 (or N240,000 annually). This translates to approximately N658 per day and in the smaller urban household of 4 would amount to N164 per person per day - less than the poverty line of N200 a day.

Of our 90 million poor people, 60 million are dependants. This leaves approximately 30 million ‘working poor’ whose income has to be raised from the current level of less than N200 to at least N700 daily. The family system remains the medium of transmission of sustenance for the unemployed. This is ineluctable for now. Illiteracy and poverty are related; twenty centuries after the development of scripts and the numeric systems, about 44% of our population still lack basic literacy and numeracy skills. Though no precise study exists, it is a reasonable guess that illiterates comprise the poorest income group.

Unemployment is at the heart of Nigeria’s poverty. There are few activities in the rural areas that create jobs apart from labour intensive agriculture; even this is seasonal. The landless farm labourers have little to do in the off-season, unless they seek work in the urban areas. Inadequacy of basic amenities like clean water, education, and health care further compounds the matter. The poor have no access to low interest funds, business development services and formalization channels.  And because government lacks functional and effective strategies to fight poverty, one of the richest countries in the world has some of the poorest people.
This is not to say that successive governments did not try. The Gowon Administration initiated the first planned effort to tackle poverty in 1972 with a focus on agriculture. The National Accelerated Food Production Programme (NAFPP) and the Nigerian Agricultural and Co-operative Bank (NACB) were created to finance agriculture but didn’t achieve much. Operation Feed the Nation was introduced in 1976 but its attempt to woo university undergraduates to rural areas to teach peasant, and mostly subsistence farmers how to farm failed. In 1979, the Shagari administration launched the Green Revolution scheme to curtail food importation and boost crop and fibre production, but compromised it by creating a task force to import rice! By 1983, billions had been wasted on these efforts with little to show for it.
In 1984, the Buhari administration introduced ‘Back to Land’ and tied the issuing of import licenses to the potential licensee's levels of investment in agriculture. Sadly, the government was overthrown before the scheme matured. Babangida’s government created the Directorate of Food, Roads and Rural Infrastructure (DFRRI) in 1986. Neither DFRRI, nor the Peoples Bank of Nigeria and the Community Banks programme made any lasting impact. In 1993 the Abacha government established the Family Support Programme (FSP) and the Family Economic Advancement Programme (FEAP). Again, they failed to succeed in tackling poverty. In 2001, President Obasanjo launched the National Poverty Eradication Programme (NAPEP) with the mandate of developing and coordinating all poverty eradication initiatives in Nigeria. NAPEP seems to have become a sales agent for Bajaj and other tricycle manufacturers of India, instead of addressing the fundamentals of poverty - income inequality, lack of opportunity and support for micro-enterprises.
What are the options before us, and what are the fastest ways of reducing poverty in Nigeria?

An important starting point is to focus on the 30 million ‘working poor’ who have 60 million dependants. To lift 90 million people above the poverty threshold of $2 daily, each of the 15 million households (6 persons per family) must earn $12 daily. This amounts to $65.7 billion annually or N10.5 trillion. Of this, N7.2 trillion will go to the dependants, but it is unrealistic for government to give out N7.2 trillion annually. In the absence of a national social safety net or the means to design one, the way out must be the creation of sustainable opportunities, incentives and better paying jobs. Macroeconomics alone cannot help without strategic planning and implementation, as well as targeted microeconomic interventions, which only the CBN governor seems to be doing so far!

Charity, welfare and aid initiatives are not enough, nor do they work. Even if poverty alleviation funds were collected through taxation or voluntary contributions, it is highly doubtful if they can be efficiently delivered. Government cannot create enough jobs to absorb the 3 million that join the workforce every year. Only the private sector can create the jobs needed in our nation. Thus, government must develop the enabling environment for job creation by others. Inaugurating a job creation committee and allocating N50 billion to it does not create jobs. The Yar'Adua-Jonathan approach of creating new agencies and ministries that duplicate the work of another and increasing the cost of governance without any results will neither reduce unemployment nor poverty.

Agriculture is the biggest employer of labour and we must address policies that promote it. For instance, the Nigerian Institute of Oceanography and Marine Research says Nigeria spends $800 million on fish importation annually. We spend more to import rice, sugar, vegetable oil, wheat and other produce we can grow or produce locally. We must save these huge sums and reinvest same in the Nigerian economy in creative ways.

Infrastructure development is also critical not only in creating construction jobs and reducing poverty, but providing the enabling environment for the private sector to flourish. Nigeria is planning to spend about 1 trillion naira on the Niger Delta Coastal Highway. How many permanent and seasonal jobs does government plan to generate from the project? It may be useful for government to insist on knowing how many jobs every million naira in government contracts and expenditure create. Considering the monumental shortages in our infrastructure sector, it is surprising that government is yet to conceive an infrastructure master plan and public works programme capable of creating millions of jobs over the next few years. 

Unless we take measures to raise family incomes, create sustainable and better paying job opportunities, build critical infrastructure, and optimally develop agriculture, Nigeria will remain a rich nation with very poor people. This is not the destiny of one of the world’s richest countries, and certainly not what Nigerians deserve. But the political elite may not care for now. After all, the standards of living they enjoy are equal or higher than the rich in developed nations, with lesser income inequality like the UK. That was before the protests, riots and looting by largely bored and unhappy young people a couple of weeks ago. It is time for the political and economic elite to work on making our incomes more equal, by rewarding entrepreneurship, innovation, honesty and hard work. Reliance on luck will not take us any further than where we are.

33 comment(s)
Post a comment

I hate this man...

Clearly this attack is on GEJ. His last sentence reveals his true intention. El-Rufai has no right to write all these nonsense. Honestly none of this makes sense. Here is a man who has played at the top for several years and had the opportunity to lift this nation out of his so-called poverty line.

The question we should be asking this goat is: what did he do when he had the platform? That is what I want to read in his next outing instead of this self-srving nonsense. A tale by an idiot full of fury...

get noticed that he is an

get noticed that he is an awareness moment for him.Is he not among those that undermine the economic Nigeria through nepotism system of government which is a subject of OBJ administration

Re: Rich Country, Poor People

A commentator here, Okwuchukwu Ezeanyika, said Nigerian leaders know what they should do to chase out poverty from our lives. I agree completely. Our leaders, except for one or two, have never be interested in eradicating poverty. We know it. And they don't care. There's nothing we can do because we can't touch them. The people treat our leaders like they're gods, and so they're gods before us. Nothing will likely change until we know what we should and must do.



Nasir, the solution is True Federalism!

Nasir, the solution is True Federalism for Nigeria.
One does not micro-manage a country of over 250 nationalities spread across more than 100 cities, over 1000 towns and in excess of 100,000 villages, from a place called Abuja.
Nasir, you observed, first hand, the workings of True Federalism in US where States and Counties have their own governments with their own Police, Fire departments and are generating their own Revenues etc.
I suspect the problem is Crude-Oil and the fear of North loosing monthly Allocation from the center.
The North has more than 200 solid minerals, arable land for agriculture and animal grazing, and can easily become the 'beautiful bride' tomorrow.
Anyhow, this fear can be addressed by advocating for the center to retain 50-70 percent of revenues generated from natural resources (Crude-oil of the South and solid minerals of the North) to be re-distributed to the federating units.

@Stanchy Ezefi please do tell us about morality

Please tell us about this teenage baby mother of yours mentioned by Mohammed, my brother born of a different mother. Spill the beans please I'm interested in the gossip. Hope you didn't pay for her to abort the baby. Nigeria is the only country where people call themselves christians yet they fornicate, commit adultery, have abortions, drink too much alchohol, take drugs and are so small minded & prejudiced that they can't see any good in anyone who doesn't pay tithes like them.
Nigeria would truly change when Christians live like proper christians - give alms to the poor, establish schools & charities, be salt & light to the world & love their neighbours as themselves. El Rufai is one of the good guys whatever you say. I love the last I love the last sentence. What a missile!

Rufai and Co.Appointed Yar'Adua, Selected Jonathan Becos Na Ijaw

In 2007 PDP presidential primaries, as other serious presidential candidates were busy trotting the nooks and corners of Nigeria to canvass for support, the trio of El-Rufai, Nuhu Ribadu and Aliko Dangote conspired and selected Yar'Adua for Baba Iyabo, OBJ. Yar'Adua never dreamt of becoming president, he never campaigned. For Vice President, the trio chose Goodluck Jonathan because he was from Ijaw. Baba Iyabo had little choice because the system in Nigeria belongs to the descendants of Othman Dan Fodio who were assigned majority status through their military's state creation acts. El'Rufai is crying over spilled milk. Nigeria has gone beyond repair, the acts of descendants of Othman dan Fodio destroyed Nigeria.

Nigeria's leaders know what to do to reduce poverty!

Nasir, to buttress my first contribution here that Nigeria's leaders know what to do to reduce poverty, let us take the matter of electricity power generation and distribution. Do the leaders not know what to do for Nigeria to have uninterrupted electricity supply? Of course, they know. How did the US achieve theirs? How did their fellow African country, South Africa, achieve self-sufficiency in power generation? What is amiss in Nigeria learning from them?

The other day Aremu told the public that the greatest corruption in Nigeria is in PHCN! But what did the man do for 8 years he was in the leadership saddle? He spent US$16 billion on power and ended up with less power generation than hitherto!

Nasir, please, save yourself these statistics. Let us talk about how the country will have leaders who will walk the talk, as Yankees would say. Period!

El Rufai: A Bad Tree Cannot Bear Good Fruit

El Rufai please stop disturbing us. You can talk from morning to night but no Nigerian including my patriotic self will ever listen to you forever. As long as you a friend and Partner to that rogue Jimi Lawal and that murderer Mohammed Buhari, no Nigerian will listen to you and more importantly you are not making sense. In 2015 we expect Pastor Tunde Bakare to replace Buhari as leader of CPC not you El Rufai. All your early campaigns will amount to nothing. P/S I expect that INEC will deregister CPC before the 2015 elections for their heinous crimes against humanity committed during and after the 2011 elections.

"That was before the

"That was before the protests, riots and looting by largely bored and unhappy young people a couple of weeks ago."

Hmmm ... this is an extremely ignorant characterisation of the young black people who exposed the hypocrisies and inequalities of British society a few ago. If you cant talk sense, if you are too lazy to research the veracity of everything you write or if you just cant be bothered to find the right words to describe people as you should because you havent properly analysed a situation, do keep quiet. And spare us the fake moralising, your posturing as a champion of the masses.

As has been pointed by others, where was this famous concern of yours for the Nigerian masses when you were offloading our national assets into private coffers? Or distributing parcels of land in Abuja to your friends and relatives as has been alleged?

"That was before the

"That was before the protests, riots and looting by largely bored and unhappy young people a couple of weeks ago."

Hmmm ... this is an extremely ignorant characterisation of the young black people who exposed the hypocrisies and inequalities of British society a few ago. If you cant talk sense, if you are too lazy to research the veracity of everything you write or if you just cant be bothered to find the right words to describe people as you should because you havent properly analysed a situation, do keep quiet. And spare us the fake moralising, your posturing as a champion of the masses.

As has been pointed by others, where was this famous concern of yours for the Nigerian masses when you were offloading our national assets into private coffers? Or distributing parcels of land in Abuja to your friends and relatives as has been alleged?

Nasir, thank you!

Nasir, thank you for your incisive commentary. I do not think that Nigerian leaders over the years do not know what to do to reduce poverty in the land. They know. The problem of Nigeria is the MINDSET of people who sprung up on us as leaders. Imagine a society where a President is being begged everyday in our newspapers, online and print, to declare his assets publicly and he has refused to do so to date. Yet, the constitution is clear that the President should declare his assets publicly within a stipulated period on coming to power.

Nigerian leaders are good in formulating programs in order to create avenues to perpetrate fraud and corruption. The failure of these programs you wrote about is because they were not established to become successful. They were destined to be merely avenues for continuous budgetary appropriation that are frittered every year into individual pockets - and nobody questions how they were disbursed.

El –Rufai, this is my take.

El –Rufai, this is my take. We need income re-distribution in Nigeria. And, this is where and how to get it done.

Nigerian looted treasury are all stashed in the housing marking (rent collectors), work out a “fair” system of taxation on rent collectors and channel that tax money to tackle youth unemployment. Will people like you and other owners of Nigeria support the above? A country with 90% of individual investment on house for rent and all built on cash basis is bound to have a very high unemployment. Discourage investment for house for rent (rent collectors) for now and encourage investment in industries, retails, manufacturing, farming/fishing, entrainment, tourist etc., trust me, unemployment will rise. Ask yourself, how many people do you need to collect rent in a ten stories building that engulfed millions if not billions of naira in capital to build?

It is a wonderful world we

It is a wonderful world we live in when a person will go into public service and operated a program of service to self as opposed to service to the people, got kicked out by the new govt in power and turn around to accuse everybody now in the govt. service of running a self-service govt.

El –Rufai, this is my take. We need income re-distribution in Nigeria. And, this is where and how to get it done.

EL-Rufai did his job

Guy, El-Rufai did his job, i am sure u live in Nigeria and you should know that his job was Abuja capital territory which all of us knew he did his work...if Obasanjo failed then that does not mean El-Rufai did not do his job...Tony Aneneh was given N350b to construct road...he did not do anything and when Orji uzo Kalu asked him, he told Nigeria that he only received N260b ..then what did he do with that which he got..he only construct the Benin bypass road ..nothing more. You heard recently when El-Rufai gave how Obasanjo influences his decision on when he was director of BPE...if you were in his shoe ...guy am sure you do worst thing..this is one of the most brilliant northerners and one of the most patriotic.. so please keep your mouth is cheap in Nigeria..everyone can talk..

Preacher of Nonsense

Nigeria's problems are well known to everyone, nothing works. Our past leaders are presently bickering on who destroyed Nigeria more, the present leader is a minus in progress. He has not declared his assets for obvious reasons, and his Dame still has our 12milla. Politics in Nigeria is about stuffing your pockets, not one dime about infrastricture or lasting institutions. It's do or die trying.

This writer contributed to Nigeria's failed status. Crying wolf because he has fallen from grace is quasch. The solutions he suggests have been heard many times over, mine is:
A) Drastically cut down salaries of lawmakers to be able to finance capital projects.
B) Cut down the size of government agencies, consolidate ministeries, cut down advisers, special assistants/touts, reduce presidential fleet, and pay a minimum wage of N18,000 as promised.
C) Limited and focused approach like constant power supply. This will boost the manufacturing sector, creating the much needed jobs.

Stanhcy Ezefe

I don't think the issue of his NYSC girl friend or so arises here. This man is talking about facts you are busy telling us his NYSC girl friend is he not a man. He is frre to marry as many as four wives if he so wishes, now if we call your father can he swear that he never have affairs with ant woman apart from your mum. I personnaly know you and infact i havethe record of the teenager you imprenated, but to me exposing it is not my prob. My prob. is how can we wnalyse this write-up work towards positive change, not to waste our time making unnecessary comments because of sefishnes or tribalism. More grease to your elbow El-Rufai.

Gani Fawehinmi: Ordinary Nigerian fortune is not going to change

Wind back 6 years, when Gani Fawehinmi said:
"How am I supposed to be happy with a government that perpetuate hunger in the country through its actions and inactions. How can anyone be happy with a government that has failed to solve the problem of power even after billions of naira has been purportedly spent. How would I see anything good in an absentee President? There is nothing to the debt relief the President is gloating over. It is only those who have cornered the resources of this country that can celebrate. It is a relief for them not the ordinary Nigerian, whose fortune is not going to change".

It is 2011 and nothing has changed.
Nigerians are not the ONES laughing!


El Rufia, I have been reading your great essays and must confess that, I am beginning to think of forgiving you for demolishing my Abuja Mansion. You called my house "illegal structure" but your people in the same ministry you head approved it.
You were then the most powerful, feared and respected man in Abuja. Now, you are learning that no condition is permanent.
You are even a better writer than all the quack writers harassing us in SRC. You are even better that Sowore (I hope he doesn't get angry and chase me out of SRC). Even though you are a Surveyor, you write as well as Okey Ndibe, Soyinka and Achebe put together.

Na so I seeam ooooh

Spot On! You Are On The Money!!!

El Rufai is an Enigma of Our Time. I visited Nigeria in April and...YES, we do have a problem. Our government's approach to tackling the issues that really affect the poor is at best "Sloppy".

We've had riots in the UK by people living on probably $20 a day. My fear is that, "Then Penny Suddenly Drops" for the poor, their reality would will lead to an extreme civil disobedience in our society. The crisis in Lybia, Tunisia, Iran, etc will suddenly seem like childs play.

Nigeria needs to swallow humble pie and listen to Mr Rufai. I've lived amongst the Rich on my last Nigerian trip's very hard to expect those people to change the status quo. The elites are too busy living large to take notice.

Time for sentiments, political affiliations, tribalism etc has to stop. If it quake like a Duck...Walks like a Duck...and even sits like a Duck...IT PROBABLY IS A DUCK!!!

What does El-Rufai want?

What is venerable about Patience Jonathan? You were part of the OBJ's economic team that set us back several years?

Methinks this short man devil with heavy Napoleon mentality needs to be locked up.

What,s new?.

I read the well researched and written article and asked what,s new and unknown about the problems and solutions to Nigeria's problems?.Until we as a people regardless of our many differences ask for ourselves the dignity and leadership we deserve and outrage and rebellion if we are shortchanged we will be in worse situation 10yrs from now.Nigerians must show courage in registering their displeasure about their situation and demand without fear for better governance at whatever consequence.Sad thing is people in power know what to do but greed has overtaken their sense of duty and service

Very good analysis, it would

Very good analysis, it would be nice if funds can be put together to make it into a documentary. Well done,

Is ElRufai now among the prophets?

Is ElRufai now among the prophets? Look at who is talking, a man who has enjoyed the the pecks of office and the best therein. Nigeria is replete with opportunists and this man is certainly one of them. Is ElRufai clean? Let him tell us the tale of his NYSC girl friend he wasted tens of millions of our national resources and tax payers money on. What of the choice properties he shamelessly allocated to himself and family in the FCT. Certainly the wrong man to talk about corruption in high places and the ills of governance. If you ask me, he remains one of them, only that he has suddenly found himself schemed out in the political calculation. Simple.

El-Rufai Again...

This man is utterly self-serving and desperate to keep himself in the public eye. He has NO moral high ground to pontificate on any thing. He is part of the cabal that brought this country to its knees through dirty lucre.

I continue to wonder why SaharaReporters grants their platform to this midget to continue to insult our collective intelligence. He should know that very soon the wind will blow and the rump of the foul will be open for all to see. Fool.

Rich Nation Poor people Nigeria

With this fact you point out There is a say A problem Identify is half way solved I believed there is a way out to Nigeria problem if our Leader will be honest to the country and Love our brothers as we loved May Allah keep blessing Nigeria and Give us leader with direction and focusL

Nigeria: Rich country, Poor people



i doff ma hat for mr. elrufai

this is el rufai at his classic and quintessential best, thumbs up for the surgical analysis of our poverty indices, its such a loely piece sir, keep it up sir, if only baba 'go slow' GEJ will hear u.

wow! bravo to Elrufai. this

wow! bravo to Elrufai. this is a very well researched article. the article is well written and seeks to understand our problems.

as an entrepreneur i can say that it is very difficult to do business in Nigeria. When i started out my projection was based on Nigeria's GDP per capital. i did not realize that the wealth is concentrated in a very few hands. That's why goods in Nigeria sells at twice or thrice the rate in other countries. because the sales volume is so low that the only way to break even is by selling at a very high margin. fact is most Nigerians can afford luxury. and the few who can afford it do not care about the cost.