The President of the African Development Bank (AfDB) Dr. Akinwumi Adesina has submitted that fiscal restructuring is possible in Nigeria.
According to him, the lamentable situation where state governments go cap in hand to get allocations in Abuja on a monthly basis is not encouraging.
Speaking recently in Lagos State at a lecture, titled, “Nigeria – A Country of Many Nations: A Quest for National Integration”, Dr. Adesina said it is possible to realize the dream of a prosperous nation where all the states are financially autonomous.
But for this to be realized, Adesina pointed out that states must focus on harnessing and developing resources where they have a comparative advantage.
He said states that adopt this strategy and become economically viable won’t have to embark on monthly trips to Abuja again.
He said the clamour for restructuring in Nigeria doesn’t have to be political but economic and financially driven.
The AfDB President added that when the states and regions are strong, then the federal will also be strong and automatically everything will take shape.
In his words, “For a new Nigeria, where one from the North shall be at home in the East; where one from the East shall break bread with one in the North; one where the one in the West shall eat from the same plate with one in the North; and wash hands in the same basin as one in the East. “
“The constituent states in Nigeria must be more financially autonomous through greater fiscal prudence. If states focus on unlocking the huge resources they have, based on areas of comparative advantage, they will rapidly expand wealth for their people.
“With their increased wealth they will be able to access capital markets to secure long-term financing to fast-track their growth and development.
“States that adopt this strategy would have less of a need for monthly trips to Abuja for grants. Instead, part of their federal revenue allocations can be saved as internal ‘state sovereign wealth funds’.
“This can then be used as guarantees against borrowings from capital markets. They would be free from needing to exclusively rely on the federal government.
“As a way out of the economic quagmire, much has been said about the need for restructuring. I know the discussions are often emotive. Restructuring should not be driven by political expediency, but by economic and financial viability – the necessary and sufficient conditions for political viability.
“Surgeries are tough. They are better done well, the first time. The resources found in each state or state groupings should belong to them. The constituent entities should pay federal taxes or royalties for those resources.
“The achievement of economically viable entities and the viability of the national entity requires constitutional changes to devolve more economic and fiscal powers to the states or regions.
“The stronger the states, or regions, the stronger the federated units. In the process, our union would be renewed. Our union would be stronger. Our union would be equitable. Our union would be fully participatory.’’