Nigeria’s Constitution Does Not Guarantee Economic Prosperity, Says Soludo
The Nigerian constitution is designed to collect and share oil rent and has little or no incentive for the growth of a productive economy, a former Governor of the Central Bank of Nigeria (CBN), Prof. Charles Soludo, has said.
Soludo made this known in an essay titled: ‘The Political Economy of Restructuring the Nigerian Federation’, delivered at a lecture organised by the Ndigbo Lagos Foundation in Lagos yesterday.
Soludo, whose lecture focused on restructuring, said prosperity in every society is usually tied to the role accorded the economic institutions.
“If Nigeria desires prosperity to the generality of its people, a new constitution with incentives for the prosperity of the mass of Nigerians will have to be written.
“Our thesis is that while other considerations may be important, the overarching case for restructuring is economic: restructuring should provide the necessary foundational meta-level socio-political-governance architecture for the emergence and sustainability of a secured and prosperous post-oil economy.
“Context and history matter, and building progressive institutions is a continuous work in progress. However, subjective one may view institutions, we can still recognise a good institution as one that unleashes and maximises the creative energies of the people for the promotion of the highest possible security, prosperity and happiness of the people.
“We argue here that Nigeria’s meta institution, its Constitution (legal-political-governance architecture) is designed to share and consume the oil rents and has perverse incentives for a productive economy,” he said.
The former CBN governor, according to Premium Times, said by its reliance on oil rent, mass economic prosperity in the country is being truncated by the twin malady known as the Dutch Disease and what he termed the Lottery Effect.
“Oil or natural resource boom is known to cause the appreciation of the real effective exchange rate thus harming the economy, and this has been referred to as the Dutch Disease syndrome. Ours is beyond the Dutch Disease. We also suffer what can be described as a Lottery Effect—a syndrome whereby a hitherto hard working person wins a lottery, quits his job and restructures his family’s lifestyle around the consumption of the lottery money; breeds more children and each with guaranteed allowance from the lottery money; and centralises decision-making in the family, such that the children never have the experience to take up challenges and mature in the process.”