Friday, 26 February 2016

Why Poverty traps in Nigeria?

Dr. Ahmed Adamu during the paper presentation on poverty
traps in Nigeria, University of Abuja. More photos below.
Today(26/2/2016), I presented a paper on why poverty traps in Nigeria at a research conference organised by International institute for Policy Review and Development Strategy, which took place in University of  Abuja, Gwagwalada, Nigeria. This is one of many other papers we compiled with my co-authors. I am inspired by this paper to write the following piece. 

There were many poverty alleviation programmes initiated in Nigeria since 1960, and as a result, trillions of Naira were spent, yet close to 80% of Nigerians live below $1.90 a day without adequate access to other basic infrastructures and amenities required for a standard of living, making many trapped in poverty. The world have been pretending to fight poverty, yet 50% of the world wealth is possessed by only 1% of the world population. The rich class has wealth growth rate higher than the middle class by 10 or more times. In four years, there were $600 billion increase of wealth for the wealthiest (Oxfam 2015).

In Nigeria, the story is not different, and you could even have more share of the wealth possessed by the 1%. If you are to share the combined wealth of all the people in Nigeria among the country's population, every Nigerian is likely to get N7 million. This figure include children and old people, and if you are to share it among only the working adult population, you will have not less than N13 million per head, and if this happens, many will not be poor, may be never again. So, some sociologist hold that greediness of the wealthiest caused poverty, but the question you ask is how do the rich become rich? why were they not prevented by the then wealthiest?.

Some also believe that income is the only indicator to poverty, but it is not, other factors are in play. Some think that poverty propensity is more attached to certain tribes or cultures, which is not, as no civilization started rich, they all started poor. There are also people who are hardworking, energetic, skillful and educated, but yet poor. It is necessary to first comprehend what causes poverty and what does not causes poverty, and how these factors correlates. This is the first prerequisite for any effective poverty alleviation programme, which many of the poverty alleviation programmes failed to identify.

Many literature and indices have proved the ineffectiveness of the poverty alleviation programmes in the country. From our experiences, we identified that many young people that benefited from the poverty programmes eventually returns to poverty, and we are keen to develop new theory that explains what have been missing in the fight against poverty and how it can be effective.

Our experiences have shown that psychology, perception and action of the beneficiaries in response to any intervention against poverty play significant role in determining the success of the poverty programmes. Some of the poverty programmes capitalized on provision of only money. For example, YouWin programme, even though proposals were requested but, young people were motivated to get the money and they can temporary develop business idea and get a proposal and pass the exams, but they might lack the interest in the business (may be the business of their interest cannot be eligible for the programme), so the aim was to acquire the money by enduring the enforced business type criteria. After acquiring the money, many of the beneficiaries of these prorgammes might want to immediately upgrade their standard of living and engage in extra spending that were not possible before, and sometimes engage in liability expenditure to maintain the new social class they claimed for themselves. All these couple with inadequate access to facilities and infrastructures, will make the agent stretch his savings to maintain social status, and eventually return to poverty, and making him poverty trapped. This could be repeated in the same pattern over time.

There are external and internal factors responsible for poverty traps: the societal unnecessary celebration and recognition of wealth motivate ostentation to acquire social recognition. Inadequate access to basic infrastructures and provisions make individuals to spend higher to sustain a higher social class, making it easy to exhaust one's additional income. Wealth and status competition in society propel unnecessary extra and unproductive expenditures. The internal factors include the tendency of one thinking and believing he is poor and he can never be rich, and this is possible by believing in some of he mentioned myth about poverty. The dependency culture is common among young people, that is why we believe continuous social welfare might make some lazy. The quest for getting rich quick and thinking of only now are also responsible for poverty traps. Blaming government for poverty will always make one wait for the government to make it up for them, and not willing to act by themselves.  Therefore, training and knowledge development programmes should be designed to address some of the external and largely internal mechanisms that  trapped people in poverty.

Another recommendation is to avoid enforcing the choice of areas of productivity or investment for the beneficiaries, first, all poverty programmes should be able to identify individuals personal interest, and then develop such interest productively to provide economic benefit and then link the benefits to the immediate society and beyond. There are also choice and leverage points, where people trapped in poverty can be made to separate between the external factors and internal factors, and then strategic training and guidance provided to them to surmount the internal factors. People trapped in poverty might have idols whom they listen and respect highly either politically, socially or economically, and such goodwill shall be leveraged in promoting positive perception and attitudes toward exiting poverty traps. This will not require direct monetary involvement, but will help fight at least the internal factors. For example, President Buhari, can use his popularity and command of followerships to engage in repeated advocacy for self determinations and best practices toward exiting poverty traps. This will help reform individual psychology and perceptions, and enhance their productivity more than what the proposed N5000 social welfare package could produce.

This could be through repeated advocacy to suppress unnecessary quest for social class and importance, and promotion of productive investment rather than immediate asset possessions. People can only get out of poverty alone only if they think they can. Many individuals became rich without participating in poverty programmes, yet many remain poor after benefiting from these programmes. It is also recommended that, the targets of these prorgammes should not be the number of beneficiaries, but the number of people that the programme can actually take out of poverty traps forever. And this has to be inclusive and responsive to the beneficiaries' already developed interest. Poverty prorgammes should not be decentralized,  it should be local, it will then be easier to track and more accessible. People trapped in poverty are encouraged to reinvest every extra income in productive venture, and do not artificially migrate to a higher social status.

This is an ongoing research and the contributions from the participants at the conference were highly appreciated.

Dr. Ahmed Adamu

More Photos from the event