COMPETING FOR GLOBAL WALLETS: UNLOCKING PATHWAYS TO PROSPERITY
COMPETING FOR GLOBAL WALLETS: UNLOCKING PATHWAYS TO PROSPERITY
The Concept of Wealth
Wealth is the ability to generate sufficient income to afford modern life’s basic necessities. A wealthy nation is one where citizens can secure essentials like shelter, healthy environment, food, education, healthcare, security, and entertainment without reliance on handouts. Earning a good income depends on what a nation produces and sells, as well as how effectively it manages its money and assets to generate more wealth.
Value Creation: The Sweet-Spot Concept
Wealth generation hinges on value creation, illustrated by the sweet-spot concept, which emphasizes balancing cost reduction with value enhancement for buyers. A nation becomes wealthier by producing goods at lower costs while maintaining or increasing value, better than others.
Reducing costs relative to other nations is driven by how effectively a nation handles infrastructure, know-how, capital, and raw materials. Government support/ leadership/ partnership is crucial in creating a cost-effective ecosystem for global competition.
Exporting for Wealth: A Nation Cannot Be Rich Selling to Itself
True wealth comes from international trade, not just by selling domestically. Foreign exchange earned through exports enables a nation to afford goods and services from abroad. A strong currency and robust economy result from producing goods that meet global value and cost expectations. The more goods a nation exports, the richer its citizens and businesses become, leading to more jobs, higher GDP, and resources for public goods (roads, healthcare, law enforcement, schools, and general modernization). While import substitution has its role, real capital growth stems from exports.
Actioning an Export-Led Economic Plan – Thoughts
Despite decades of talking about diversification, Nigeria remains dependent on oil. To truly diversify, Nigeria should leverage its oil assets to support the development of other internationally demanded products and services. This requires a shift to an export-led economic plan, where the national strategy revolves around exports. Strategic and annual plans should emphasize exports while also supporting import substitution. Both government and private sector actors must adopt this mindset and must work together to envision, scope, strategize and execute for it.
It is also important to note that nobody can be the best in everything; so it is with countries. Being the best requires investments, policies, know-how, and image in the international community. As a country, we must decide where to focus our time and resources on building international-level competence. Without international-level competence, there will be no international-level customers.
My case is for Nigeria to adopt a more guided economic development framework where the nation sees itself as a business entity—a diversified group of companies. The country should focus on sectors where it can compete internationally. This competitive advantage can be historical, engineered, or natural. Benchmarking against crude oil’s $30B yearly revenue, Nigeria should identify five strategically relevant sectors (SRS’s) where it has or can create a competitive advantage. The questions then are:
• What sectors should be prioritized?
• How should they be developed?
• What government-private sector collaborations should lead the effort?
To be continued…
Sir Mac Atasie (CEO, Nextzon)
Leave a Comment