The ceding of Bakassi Peninsula by Nigeria to Cameroun on October 9, 2012 following the International Court of Justice judgment in 2002 and the loss of the oil wells to Akwa Ibom State through the Nigerian Supreme Court judgment of 2012 are two events that mark a turning point for Cross River State. These two events established the reality of the fact that we are now a non oil state; a reality we have to live with.
Does this reality spell an imminent doom for us as a state or is it an opportunity in disguise for the state to realize its potentials and build a stable economy beyond oil? The truth is, it could be either of the two depending on how we choose to see it and what we choose to do as a result of how we see it. These two will be functions of the kind of leader we have at the helm of affairs in the state. I will like to strongly advise we see it as the later, “an opportunity in disguise for the state to realize its potentials and build a stable economy beyond oil” and get up and work to achieve these potentials.
Cross River State is richly blessed with both human and natural resources, which if well harnessed can lift the state to become a leading state in the committee of states in the nation. The state is already a leading state on many fronts with its pioneering role in tourism development, information and communication technology, public transportation etc.
In order to thrive and prosper in this 21st Century, the state must come to terms with the reality of its status as a non oil economy and evolve strategies that will develop its economy, create jobs for its citizens and reduce poverty in the state.
This paper, presented at the Cross River Watch 3rd Year Anniversary Lecture with the Theme: Reality of a Non-Oil Economy – Prospects and Challenges, gives an insight into how Cross River State can survive as a non oil state in Nigeria.
Going forward, I will consider three key propositions.
First is the need to look closely at other sectors of the state economy such as Tourism, Agriculture, Solid minerals and Creative Industries where the state has comparative advantage and seek innovative ways to harness the enormous potentials and opportunities that abound.
Cross River State is already a leading state in tourism but must build further to reposition the sector to contribute maximally to the growth of the state economy. The state must also focus on other sectors mentioned above to help diversify its economy. The development of these sectors of the state economy would not only contribute to the growth of the economy but will create jobs for our teeming youths.
Second, there is need for the state to develop an effective tax collection and administration system for sustainable economic growth. The role of tax in increasing internally generated revenue cannot be overestimated. Presently the tax collection and administration in Cross River State leaves a lot of leakages and can best be said to be uncoordinated with issues like over taxation, under taxation and sometimes no taxation at all. If the state must make progress in the direction of the non oil economy, then it must organized it tax system and upgrade policies, technologies and personnel in the collection and administration of tax.
Third and final, we will take a look at the need to attract Foreign Direct Investment into the state as key to industrialization and bringing in capital, technical know-how, technology transfer and other benefits of FDI. In the past decade, Cross River State has established itself as an investment destination of choice but more must be done to attract more investors to the state in the next decade.
DEVELOPING DIFFERENT SECTORS WITH COMPARATIVE ADVANTAGE IN CROSS RIVER STATE
Repositioning the Cross River State Tourism Sector to contribute effectively to economic development of the state
Today, tourism is major source of income for many countries. Tourism brings in large amounts of income into a local economy in the form of payment for goods and services needed by tourists, accounting for 30% of the world’s trade off services. It also creates opportunities for employment in the service sector of the economy associated with tourism.
Cross River State over the years is one of the leading tourism destinations in Africa. The state has consistently invested in the development of tourism and millions of tourists visit the state annually. Two of the state’s flagship events, the Carnival Calabar and the Calabar Festival have become globally acclaimed and draw sponsorship worth millions of dollars from corporate organizations.
In so much as notable achievements have been recorded in this area, there remain more grounds to be covered. Government must ensure the development of tourism sites to meet international standards to yield revenue to the state. Fully developed, tourism in the state has the potential to generate over 40% of the state’s income.
To further facilitate the growth of tourism in the state, governments must increasingly partner with the private sector to ensure quality service delivery and to promote the unique environmental attractions and natural resources, indigenous arts, and culture that give the state an edge over competing travel destinations.
INVESTING IN AGRICULTURE AS AN ALTERNATIVE TO OIL IN CROSS RIVER STATE.
Cross River State is blessed with arable land and environment that can support the growth of important crops and rearing of animals to provide food and raw materials for industries. Some important cash crops available in the state include cocoa, oil palm, cashew, rubber, rice, cassava, plantain and many more. These crops are cultivated in different parts of the state and have the potentials to be produced in commercial quantities in every local government area in the state.
The development of the value chains of these crops has the potential to boost the economy of the state. Agricultural revolution in the state, with its massive increases in agricultural productivity and economic impact will be based on the state’s advancement into large scale commercial Agriculture and mechanization. The Governments intervention in the sector and removal of identifiable bottlenecks as well as provision of incentives for increased Agricultural output is commendable. But there is room for improvement.
The state has made long-term investments in Agriculture in partnership with the private sector and this must not only be sustained but expanded in the next few years. Public Private Partnership model of investment in the production, processing and marketing of identified cash crops in Cross River State will create a stream of income for the state that is capable of even surpassing income from oil. As the price of oil in the international market falls, Agriculture has become the new oil for Nigeria.
PROMOTING INVESTMENT IN SOLID MINERAL FOR THE GROWTH OF CROSS RIVER STATE ECONOMY
Cross River State is rich in solid minerals, which is presently largely unexploited. Of note are limestones, barytes, clay, salt, tin, granite basalt, quartzite, kaolin, feldspar to mention a few. In spite of the rich mineral endowments, mining activities at a commercial level have been restricted only to limestone. The solid mineral sector has the potential of contributing to the economic development of Cross River State and creating jobs for millions of its youths.
Sustainable mining and utilization of Solid Minerals in our state are central to growing our economy. Charting a path to this sustainable development in the mineral sector must involve calculated steps to attracting investment as a catalyst to industrialization of the state. Private Investment in this sector is perceived as the key because the state has vast amounts of solid minerals that can service these industries for decades.
Cross River State must thus evolve strategies through which it can maximize its returns on investment in the mineral sector. This can be achieved by not just highlighting the available solid minerals in the state but also establishing the quality, quantity and specific location of each solid mineral present in the state.
In addition to this, the state government must take specific steps to acquire rights to these minerals deposits and partner with private firms for the exploration and exploitation of these solid minerals. In this way the Cross River State Government will not only benefit from taxes derivable from these investments but also get direct Return on Investment as an investor.
The solid mineral sector presently contributes less than 1% to the Gross Domestic Product of Nigeria and the country imports most of its mineral resource needs. Promoting investment in mineral resources development is the solution to our economic challenge and if we get this right, it has the potential of not only changing our economic fortunes but also creating jobs for thousands of youths.
CREATIVE ECONOMY AS THE PATHWAY TO ECONOMIC REVOLUTION OF CROSS RIVER STATE.
The creative economy –which includes audiovisual products, design, new media, performing arts, publishing and visual arts– is not only one of the most rapidly growing sectors of the world economy, it is also a highly transformative one in terms of income generation, job creation and export earnings.
The creative industry has been seen to become increasingly important to economic well-being, proponents suggesting that “human creativity is the ultimate economic resource,” and that “the industries of the twenty-first century will depend increasingly on the generation of knowledge through creativity and innovation”.
The creative industry, especially the film and music industry, has contributed immensely in the growth of the Nigerian economy. Nigeria’s creative industry potential valued at over N5 trillion with annual turnover of about N500 billion, is one of the fastest growing industries in Africa today.
In Cross River State, the two flagship events of the state tourism initiative, Carnival Calabar and Calabar Festival have created a platform to promote the growth of the creative industry in the state. Annually, hundreds of actors, musicians, artists, sculptors and designers seize the opportunity presented by the Calabar Festival and Carnival Calabar to develop their creativity and showcase same to the world.
From the foregoing, I make bold to say that the creative industry holds the key to economic revolution of Cross River State. Paying attention to our intellectual property and seeking ways to develop same are the ways to achieve the quantum leap the state desires to move its economy ahead.
While creating jobs, creative economy contributes to the overall well-being of communities, individual self-esteem and quality of life, thus achieving inclusive and sustainable development.
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