Professor Paul M Lubeck
Acting Director, African Studies Program
Johns Hopkins University-SAIS
The Challenge of Coordination, Investment, and Employment for Economic Reconstruction in North Western and North Eastern States of Nigeria
National Institute of Legislative Studies
Abuja, Nigeria
November 16-17, 2015
The Challenge: Economic Reconstruction in the North East and North West Zones
The nineteen northern states of Nigeria represent 73 percent of the territory of the
Federal Government of Nigeria (FGN), roughly twice the size of Germany, and account
for approximately 60 percent of Nigeria’s total population (i.e. 108 million). This means
the population of the northern states is larger than Ethiopia, Africa’s second largest
state. Here we focus solely on economic reconstruction in the thirteen states within in
the North East and North West zones which, unfortunately, register some of the world’s
worst human development indicators. Regrettably, what these figures portray is a
nation undergoing an increasingly violent process of regional polarization. Over the
past decade, despite an impressive uptick in aggregate rates of economic growth and
rising per-capita incomes in the oil-rich, better educated and economically dynamic
southern states, Nigeria is becoming spatially polarized and socially bifurcated into a
modernizing south, nurtured by superior infrastructures, consumer demand from a
rising, educated middle class on one hand and, on the other, an introverted,
economically stagnant, conflict-ridden, impoverished “North”. It is readily apparent that
the Nigerian nation will not prosper unless all states participate in the benefits of
economic growth. Similarly, policy makers from the North Western and North Eastern
states are obligated to learn from the successful initiatives pioneered by the southern
states so as to reverse the process of polarization.
More alarming is the extremely serious situation in the North East zone where the so
called Boko Haram insurgency is concentrated. This zone is now mired in a deep multi-
dimensional social and economic crisis marked by rising fertility rates, a stagnant
economy, millions of displaced persons, increasing criminality, feeble, indifferent
1
governance institutions, a Salafist-jihadi insurgency, millions of abandoned,
undernourished and stunted children, and declining per capita incomes (e.g. 65-75%
living below $1.25/day PPP). As the data within accompanying Tables confirm,
decades of indifferent misrule by rent-seeking and fragmented elites have spawned an
enormous, immiserated population of male youths, bereft of any hope for marriage,
pathways to decent livelihoods or social inclusion. Unsurprisingly, after decades of
criminal neglect in the face of flagrant political corruption, a minority of these enraged
northern youths are revolting against the social order and misrule by older, senior
generations by engaging in organized criminal and political violence.
This paper assumes that the Boko Haram insurgency is the extreme outcome of a much
larger and far deeper crisis in economic and political governance in the North East and
North West zones, one that has taken decades to germinate but is relentlessly driving
many forms of violent, criminal and extremist behavior. Boko Haram, therefore, should
be understood as a predictable outcome, not the original cause of the crisis racking
northern Nigeria. Since the drivers of this crisis are demographic in origin and rooted in
the unemployment of youths, policy makers at the sub-national state level must design
and implement new strategies to reduce the causes and increase opportunity for
northern youths. To be sure, expectations are very high. Nonetheless, the integrity of
the 2015 election offers policy makers a unique opportunity to implement social and
economic policies that will bolster investor confidence while, simultaneously, offering
tens of millions of northern youths greater hope for a dignified and productive life.
What exactly is the northern demographic crisis and how does it generate violent
behavior among northern Muslim youths? Since the age structure of any society, e.g.
2
the proportion of the population between 15-45, determines its future population growth,
current demographic trends are constructing an enormous “youth bulge” in the North
East and North West zones. We estimate that approximately 70 percent of the
population in the overwhelmingly Muslim states of the Northwest and Northeast Zones
are below 30 years of age.
Map 1.1 - Total Fertility Rate by Zone
3
Map 1.2 - Women Under 19 Who Are Mothers or Pregnant with First Child
4
Map 1.3 - Percentage of Women Using Any Kind of Birth Control
5
Chart 1.1 - Children Under 5 Who Are Moderately or Severely Stunted
North Central North East North West South East South South South West Nigeria Total0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
Children Under 5 Who Are Moderately or Severely Stunted
2008 2013
6
Chart 1.2 - Women Who Received ANC From a Skilled Provider for Most Recent
Pregnancy
7
Map 1.4 - Women Age 15-49 Who Are Literate
8
Map 1.5 - Women Age 15-49 With No Education
9
Map 1.6 - Women Age 15-49 Whose Highest Level of Income Is Primary School
10
Map 1.7 - Women Age 15-49 Whose Highest Level of Income is Secondary School
11
Map 1.8 - Women Who Report Controlling Their Own Income
The North West Zone, Nigeria’s most populous, most fertile and most Muslim zone, with
a fertility rate since 2003 varies between 7.4 and 6.7 births per woman, closely parallels
that of the Republic of Niger, a country ranked at the absolute bottom of the UNDP’s
human security index. Similarly, it is not surprising that 36 per cent of girls between 15
and 19 in this zone are either pregnant or have already given birth. Therefore, the total
12
fertility rate and the structure of the population guarantee that enormous waves of
impoverished male youths will be migrating to northern cities for decades to come.
The northern crisis, therefore, is not primarily an economic crisis: rather it is driven by
gender relations, specifically the social and economic status of northern Muslim girls
and women. These statistics demonstrate that unless the health, educational and
economic status of girls in these two zones are raised significantly, so as to reduce
fertility rates to sustainable levels, both absolute and relative per capita incomes of
all living in these two zones will inevitably continue to decline. Per capita incomes in
these two zones will decline because, under any imaginable rate of investment or
economic growth scenario, the northern economy will be incapable of generating an
economic growth rate high enough to compensate for the high rate of population growth
occurring within these zones. Therefore, unless total fertility rates are lowered by
introducing responsible and realistic health and education policies, per capita income
and living standards will decline and the risk that recruitment into violence-prone
organizations will continue.
State Governance: Mobilizing Public-Private Initiatives for Youth Employment
Addressing the youth employment crisis in these two zones requires state policy makers
at the sub-national level to wed public governance institutions at the state level with
market-driven incentives so as to attract productive private investment for labor
absorbing industries. For many northern policy makers, this means learning from the
experience of comparable, Muslim-majority countries like Malaysia, Indonesia and
13
Turkey whose economies are far more advanced and, interestingly, where many
northern Muslim elites send their children for higher education.
Fortunately, under Nigeria’s democratic federal constitutions, state governors possess
not only immense fiscal, territorial, legal and security powers, but they also control a
statutory revenue allocation, (e.g. the federal account) derived from energy rents.
Similarly, because FGN agencies delegate all multi-lateral, bi-lateral and federal
economic programs to state administrations, any realistic strategy for northern
economic recovery must recognize the pivotal role played by governors in recruiting
investors, allocating land, managing industrial estates, siting infrastructures and
managing regional economic planning authorities. State authority over land allocations
means key labor-absorbing industries---urban construction, SMEs, industrial estates,
and agricultural investment---will be subject to the state authorities. More importantly
for youth employment, northern governors control elections, fiscal affairs, educational
institutions, and social programs managed by Local Government Authorities (LGAs).
The LGAs are important because they possess a hitherto unrealized potential for
nurturing labor absorbing social enterprises as well as for providing social, educational
and health services for northern youths adjusting an increasingly urbanized society.
Given the constitutional authority vested in states, northern governors must be
convinced to use their authority to solve the coordination problem. Currently, at the
state level, the coordination function is fragmented, feeble, or completely absent, largely
because development initiatives are dispersed among different ministries, planning
agencies, federal agencies, international donors, contractors to multi-lateral agencies,
special advisors to the governors and/or to insider-political patrons or “godfathers”.
14
Strong voices for re-industrialization routinely call for launching of the equivalent of a
“Marshall Plan” to spearhead a northern recovery. Yet, few voices have proposed
exactly what institutional mechanisms or what kinds of agencies will perform the
coordination function among numerous, overlapping and often competing public, private
sector and social sector actors. Implementation requires technocratic expertise and
designated development agencies if the coordination problem is to be resolved.
Key coordination function questions facing states in these two zones are: what agency
will coordinate among the public actors, investors, industrial financial institutions and
contractors from multi-lateral institutions? Which agency will perform the coordination
function necessary to recruit labor absorbing firms, raise funds for infrastructures, train
technical labor, articulate with FGN programs implemented by donor agencies, promote
industrial linkages, rationalize “industrial clusters”, and evaluate future technical
upgrading necessary for boosting value added in particular industries? What agency
will collect, process, and disseminate reliable economic information for potential
investors regarding existing industries, incentives, regulations, local partnerships and
proposed infrastructures? Which state-level agency will facilitate the concerns of
potential investors to agencies in the FGN? In federal states like Malaysia (e.g. Penang
Development Corporation) and in semi-autonomous regions like Wales (Welsh
Development Agency), industrial development agencies within subnational units (e.g.
states) have proved very effective in performing the critical coordination function.
The coordination problem raises the question whether the regional industrial agency
model will promote industrial construction and employment generation in the two zones.
Finally, competent state industrial authorities will require trained professionals with deep
15
private sector experience if duplication, confusion, waste and graft are to be avoided.
Unfortunately, without a permanent, professionally staffed, industrial development
agency, charged with providing coordination and continuity, a democratic change in
governors not only risks the destruction of valuable industrial development projects, but
also the state’s industrial- institutional memory.
Economic reconstruction requires leaders in the North East and North West zones to
pursue policies that nurture industries that increase productivity and employment.
Policies should be realistic, market augmenting and truly “developmental” policies in the
East Asian sense of the term. Not only must they define broad goals, they must set
empirically verifiable and transparent performance targets so that outcomes, be they
successes or failures, will be transparently accountable to technocrats and public
monitors, e.g. elected local and state officials and independent civil society groups. In
addition, these policies must mobilize public and private resources to upgrade the
quality of educational institutions in ways that will prepare youths---male and female---to
be able to produce goods and services for northerners with incomes and for southern
Nigeria’s rising middle classes. This will require linking educational institutions more
closely with private sector employers in different sectors. This strategy requires
Nigerian states to create regional development agencies (RDAs) to perform the
coordination function by not only promoting investment in productive industries but also
by facilitating the linking of industries to social partners, educational institutions and
sources of finance.
Learning from the Malaysian Experience: The Penang Development Corporation
16
Many northern Nigerians are impressed with the economic and social performance of
Malaysia since independence. Historically, this is understandable because Nigeria and
Malaysia share many common experiences including a common colonial governor,
Hugh Clifford. Both are multi-ethnic federations with large Muslim populations in which
a form of shari`a law exists for Muslims. Colonized by the British under the doctrine of
indirect rule, both retain Muslim titles and members the aristocracy are strongly
represented in the civil service and political elite. And both countries have struggled to
deal with tensions that arose from ethnic divisions of labor and education deficits which,
in turn, produced compensatory programs to ensure federal character in employment
and opportunities for indigenous communities. While both experienced ethnic conflict
during the late sixties, the Malaysian policy response differed significantly from Nigeria.
Map 1.9 - Political Map of Malaysia
17
Map 1.10 - Developmental Regions and Corridors of Peninsular Malaysia
18
In 1971 the Malaysian federal state institutionalized an economic and social re-
engineering program called the New Economic Policy (NEP) which called for the
elimination of absolute poverty, the absolution of the ethnic division of labor, the
creation of a Malay (Bumiputra) professional and entrepreneurial class and the
redistribution of corporate equity according to ethnic identity. The accompanying
demographic tables demonstrate the success of the program in terms of eliminating
poverty, educating all citizens, offering opportunity for women and providing a
foundation for social stability that attracted foreign investment. Today poverty has been
effectively abolished and Malaysia’s adjusted per capita income (PPP) is over $17,500.
Table 1.1 - Births Per Woman
Malaysia Indonesia
Births Per Woman 2.18 2.58Source: CIA World Factbook
Table 1.2 - Women Age 15 and Above Who Can Read and Write
Indonesia MalaysiaMen 95.6% 95.4%Women 90.1% 90.7%Total 92.8% 93.1%
Source: CIA World Factbook
19
Table 1.3 - Secondary School Participation, Net Enrollment Ratio 2008-2012
Indonesia Malaysia
Men 74.4% 71.3%
Source: CIA World Factbook
Table 1.4
1970 1976 1979 1984 1987 1989 1992 1995 1997 1999 2002 2004 2007 2009 2012Bumiputera 64.8% 46.4% 49.2% 28.7% 26.6% 23.0% 17.5% 12.2% 9.0% 12.3% 9.0% 8.3% 5.1% 5.3% 2.2%Chinese 26.0% 17.4% 16.5% 7.8% 7.0% 5.4% 3.2% 2.1% 1.1% 1.2% 1.0% 0.6% 0.6% 0.6% 0.3%Indian 39.2% 27.3% 27.3% 19.8% 10.1% 9.6% 7.6% 4.4% 2.6% 1.3% 3.4% 2.7% 2.9% 2.5% 2.5%Other 44.8% 33.8% 28.9% 18.8% 20.3% 22.1% 21.3% 22.1% 13.0% 25.5% 8.5% 6.9% 9.8% 6.7% 1.5%
Source: Malaysian Department of Statistics, Malaysian Economic Planning Unit, World Bank
Incidence in poverty in Malaysia by ethnic group, 1970-2012
Chart 1.3 – Incidence of Poverty in Malaysia by Ethnic Group, 1970-2012
20
Table 1.5 – Tertiary Education in Malaysia by Ethnic Group, 1980-2000
1980 1990 2000Bumiputera 49.24% 59.65% 59.92%Chinese 39.71% 32.13% 32.52%Indian 8.61% 6.27% 6.80%Other 5.43% 1.95% 0.76%
Source: "Access to and Equity in Higher Education - Malaysia," World Bank, 2012
Tertiary education in Malaysia by ethnic group, 1980-2000 (% of enrollments)
Table 1.6 – Total Enrollment in Tertiary Education in Malaysia, 1970-2000
1970 1980 1990 2000 2007Percent of population 0.60% 1.60% 2.90% 8.10% 24.40%
Source: "Access to and Equity in Higher Education - Malaysia," World Bank, 2012
Total enrollment in tertiary education in Malaysia, 1970-2007 (% total population)
Table 1.7 – Individuals With Higher Education, 1980-2000
1980 1991 2000Male 67.79% 58.40% 50.93%Female 32.21% 41.60% 49.07%Male 69.53% 60.48% 54.64%Female 30.49% 39.52% 45.36%Male 66.82% 63.39% 56.28%Female 33.18% 36.61% 43.72%Source: World Bank, Malaysian Department of Statistics, Malaysian Economic Planning Unit
Bumiputera
Chinese
Indian
Individuals with higher education, 1980-2000 (% total population with higher education)
Table 1.8 – Secondary Education, Female
1970 1975 1980 1985 1990 1995 2000 2005 2010Secondary education, female (% gross) 40.97% 43.25% 47.62% 49.11% 50.81% 51.21% 51.16% 51.26% 50.53%School enrollment, tertiary, female (% gross) No data No data 3.07% 5.02% 5.53% 7.06% 26.47% 30.90% 40.85%
Source: World Bank and Malaysian Department of Statistics
Chart 1.4 – Female Education in Malaysia, 1970-2010
21
Table 1.9 – Total Fertility Rate
1970 1975 1980 1985 1990 1995 2000 2005 2010Fertility rate, total (births per woman) 4.872 4.209 3.789 3.656 3.515 3.339 2.825 2.216 2.002
Source: World Bank and Malaysian Department of Statistics
Table 1.5 – Total Fertility Rate
Table 1.10 – Employment in Agriculture, Female
22
1970 1975 1980 1985 1990 1995 2000 2005 2010Employment in agriculture, female (% female employment) No data No data 43.80% 33.80% 25.30% 16.90% 14.0% 10.20% 8.50%Employment in agriculture (% of total employment) No data No data 37.20% 30.40% 26% 20% 18.40% 14.60% 13.30%
Source: World Bank and Malaysian Department of Statistics
Table 1.11 – Poverty Rate
1970 1975 1980 1985 1990 1995 2000 2005 2010Poverty rate (government poverty line) 43% 39% 37% 20% 17% 9% 8% 6% 4%
Source: Malaysian Department of Statistics
Table 1.12 – Life Expectancy at Birth
1970 1975 1980 1985 1990 1995 2000 2005 2010Life expectancy at birth, total (years) 64.46 66.40 68.06 69.50 70.76 71.86 72.85 73.84 74.50
Source: World Bank and Malaysian Department of Statistics
Although the NEP virtually eliminated poverty and uplifted the economic and
educational status of the Muslim Malays, it was not responsible for the innovations that
enabled Malaysia to become a middle income country and a newly industrializing state
whose exports are about 80 per cent industrial goods. Instead, the institutional
innovations that propelled Malaysia to its current status was initiated as an experiment
undertaken by one of the poorer states, Penang, to bolster employment since ethnic
conflict of 1969 and the recent loss of their free trade status. Under the leadership of a
brilliant Chief Minister (e.g. governor), the state of Penang transformed a moribund
state economic development corporation, the Penang Development Corporation (PDC)
into a dynamic, innovative regional development agency that emulated the policies
pursued by Asian developmental states especially Singapore and Taiwan. Working
closely with the chief minister who negotiated free trade zones and other incentives for
electronics firms such as Intel, National, Motorola and Dell, the professional staff at the
PDC developed a strategy that constantly upgraded skills, nurtured linkages and
industrial clusters and pursued technological services for high tech firms.
23
Map 1.11 - Penang K-Worker Clusters
24
Map 1.12 - Penang Company Clusters
The demonstration effect of the PDC’s success provoked other Malaysian states
especially Johor, Kedah and Selangor to replicate the PDC strategy of EOI and FTZs.
Again, the success of the Malaysian model is built on the foundation of social equity and
redistribution but the dynamic growth and innovation that increased employment, raised
incomes and lifted skill levels came from international firms and the linkages to local
firms.
25
In addition to providing secure title to land and infrastructures, what lessons can the
states from the North West and North East learn from the success of the PDC? The
first lesson recommends creating a professional regional or state development agency
directly under the governor and not subordinated to a state ministry personed by the
civil service. The PDC employed highly motivated technocrats who understood the
private sector, the market forces faced by the firms that they were recruiting. Second,
the PDC encouraged managers working in the multinational firms to create local
suppliers, service firms and linkages. Multinational firms desired local suppliers and
subassembly firms so they fostered managers to create supplier firms that allowed them
to focus their resources on more technically advanced and more profitable tasks, e.g. “a
win-win” arrangement. Third, the PDC pursued what are called “developmental firms”
with a vision for building up the capacity of the region. These firms understood the
benefits of public-private collaboration and oftentimes seconded engineers to assist
local firms to meet the quality standards of their suppliers. Fourth, the PDC organized
producer associations for the supplier firms and built common technical and testing
facilities to enable them to move to the next level. Fifth, in 1989, the PDC facilitated the
creation of the Penang Skills Development Centre which integrated academic, public
sector and private firms around the goal of increasing the number of skilled workers
especially engineers and offering them credits, certifications and degrees that became
part of the workers’ portfolios, e.g. their credentials (twelve other states have emulated
the PSDC). Sixth, the PDC constantly supported the creation of SME services in order
to incubate local firms whom they encouraged to become integrated into the production
networks of Multinationals (see, http://smartpenang.my/). With these lessons from
26
Penang in mind, let us turn to the obstacles faced by Kano with an eye to evaluating the
value of a state or regional development agency
Kano: The Challenge of Coordinating Industrial Recovery Strategies
In this section, I will present a summary of several economic reconstruction initiatives
pursued by different leaders in Kano since 2004. Drawing on the experience of Penang
and other regional development agencies at the state level, my objective is to inquire
whether or not a coordinating agency like the PDC could have contributed to economic
reconstruction in the leading industrial center of northern Nigeria.
For at least the last two hundred years Kano city and its networks have constituted an
innovative center of commercial, financial and industrial activity in West Africa. Before
the collapse of petroleum prices and the imposition of structural adjustment policies
(SAP) in the early eighties, Kano possessed at least 500 hundred manufacturing firms
engaged in the light manufacturing of consumer goods, agro-processing, food, textiles
and plastics for local, regional and West African consumers. Many industrialists were
indigenous Kanawa or long term residents of Kano who possessed Nigerian citizenship
and, equally important, Kano’s powerful merchant networks were closely integrated into
the consumer goods manufacturers.
A number of factors contributed to what is regrettably more than a quarter century of
industrial decline: the deep devaluation of the Naira made it impossible for firms to
purchase space parts and imported inputs; structural adjustment policies (SAP)
implemented by the federal government crushed consumer demand for locally
manufactured goods; cheaper imported goods, both smuggled and legal, challenged
27
local manufacturers and forced the closure of many firms and the incapacity of the
Nigerian state to produce and deliver electric power raised the cost of production to
prohibitive levels. Textile production for the domestic market, once the most advanced
sector with excellent backward linkages with cotton producers and ginneries, employing
more than 700,000 workers in Nigeria, have almost completely disappeared. The
export-oriented tanning industry is the exception in part because of an export subsidy
and the concentration of tanning among few firms. In general, however, neither the
federal government nor the state governments have been able to implement an
industrial policy capable of reversing the collapse of manufacturing in Kano and the
associated decline in employment opportunities for youths in the North Western and
North Eastern states.
Driven by high fertility rates and the migration of youths to metropolitan Kano, the
population of Kano had grown to about 4 million by 2004. Under-employment and
unemployment have produced a vast number of male youths seeking work in the
informal sector since employment at the industrial estates had dried up. At the same
time as the return to democratic rule in 1999, the incidence of ethnic and religious
conflict had increased significantly in Kano. In 2004, an especially destructive and
widespread ethnic conflict erupted allegedly in retribution for the loss of local lives in
Plateau State, e.g. the “Yelwa killings”.
In response to reputational damage inflicted by the rioting and the withdrawal of
investment capital from the city, a group of enlightened citizens formed the Kano Peace
and Development Initiative (KAPEDI) with the intention of restoring the reputation of the
city for commerce and tolerance. Forms were held and representatives from different
28
communities were invited to participate. The leaders conveyed a vision of Kano that
was cosmopolitan and open to strangers who wish to trade and invest in the city.
Leaders cited the long history of diversity as registered in the names of the wards of the
Old City and made significant progress in area of peace, reconciliation and trust. The
positive response to KAPEDI’s forums encouraged the leaders to seek funding and
support for an Economic Summit focusing on the revitalization of Kano.
In April 2006, with the support of donor agencies, the governor of Kano and Bayero
University, the summit was held and over 1,000 people participated and/or attended the
event. Papers were presented and a committee was created to publish the papers.
Efforts to move the discussion forward to the level of industrial policy, however, founded
on the shoals of political partisanship because of perceived differences between the
state governor and the titular head of KAPEDI who was a minister in the ruling PDP
government in Abuja. Interpretations of the breakdown of trust and communication
among the parties vary but the outcome resulted in a stalemate. The Summit paper
were not published and the state government, according to published reports,
expressed no interest in collaborating on an economic revitalization or re-
industrialization strategy. Here distrust among the leadership and the lack of a
permanent state industrial development agency to coordinate the project appear to
explain the failure of the Summit to contribute to the reconstruction of industry in
northern Nigeria’s largest city.
The Kano ICT Park as a Public-Private Initiative
29
One of the most innovative presentations at the Kano Economic Summit was made by a
professor of electrical engineering from Bayero University who was the special advisor
for technology to the Kano State governor. Appropriately entitled “Exploring New
Business Opportunities in the ICT Sector”, the advisor reviewed the growth of the global
knowledge economy, the success of Indian software industries and services, the value
of E-governance, and Kano State’s plan to build an ICT Park to incubate businesses,
conduct trainings and support local enterprises. The plan called for siting the ICT Park
in the Ado Bayero building, obtaining FTZ status for occupants and for recruiting firms
and instructional programs to fill the spaces of an 11 story building. The secure power
source in the building was very attractive to firms from the IT industry and the project
had the strong support of software firms, digital SMEs and many academics. The World
Bank representative I interviewed about the Park supported the project as well.
Whatever the pros and cons of this venture it was the most innovative and potentially
productive project in support of the re-industrialization of Kano.
Unfortunately, before the ICT Park could become fully operational, the sitting governor
completed his second term, a former governor was brought back into office. Instead the
building was converted into a temporary site for a new state university. Critics of this
decision believe the ICT Park would have benefitted many businesses and provided
support for the GSM Repair and Assembly Association. The leaders of the Association
claim to have 5,000 youthful members in Kano and report being able to not only repair
mobile phones but also to flash software into their memory cells. They lamented the
demise of the ICT Park and pointed out that the government was establishing a ICT
training center at Kura but it would not generate support for SMEs. In this instance, a
30
dedicated, professional development agency may have been able to provide continuity
between administrations thereby salvaging a resource that would have anchored the IT
industry in Kano.
Concluding Thoughts on Strategies for Solving the Coordination Problem
While it is true that Kano has made enormous progress in the area of infrastructure,
housing estates and micro-credit, the industrial sector has not experienced a revival.
The tanning industry exports approximately $700 million in finished ovine leather but
linkages to finished leather products are extremely weak. There is great potential for
backward linkages if a regional development agency was directed to increase the
production of goats among small holders and women in the region. The tanneries
experience a shortage of skins and import about half of those that they tan.
In order for manufacturing and other industries to be reconstructed, the energy source
for power must be solved. The absence of electric power adds between 30 and 50
percent to the cost of production according to industrialists. Solving the power problem
requires public-private collaboration and the mobilization of the business and political
communities around solving the power problem. Both the reconstruction of power
services and rail services are necessary for the the revitalization of industry in these two
zones. Given Nigeria’s abundant source of natural gas and several efforts to fund the
piping of gas to the industrial areas of the Northwest states, the extension of the natural
gas pipeline to the northern states constitutes an excellent project for the Northern
Governor’s Forum to pursue.
31
