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Date Published: 05/06/10

Rethinking Nigeria’s Economic Diplomacy By Idumange John 


At independence, most African states emphasized the use of politics to further their foreign policy objectives. A foremost proponent of this ideological inclination was Dr. Kwame Nkrumah. This is predicated on his famous dictum “seek ye first the political kingdom and all the rest will follow”. Thus the newly independent states were at a great cost to issues of economic development. At independence, however, most African states failed to give attention to addressing their economic problems through foreign policy. Perhaps this failure was due to the fact that most of them were initially pre-occupied with urgent political problems related, among others, to the consolidation of political independence, territorial integrity, and eradication of colonialism, racism and apartheid.  

While these lofty objectives were pursued, the economies of African states witnessed low productivity, incurred huge debt and suffered phenomenal shortfall in balance of payment positions. Fifty years down the line, Africa recorded stunted economic growth and has largely remained as a periphery of the capitalist countries. The under-development or rather stagnation of Africa is largely blamed for the leaders’ inability to pursue sustainable and virile economic diplomacy.

Diplomacy is the art of conducting and implementing foreign policy. It is the process by which diplomats seek to achieve foreign-policy goals through the instrumentality of negotiations and bargaining by State and non-State actors. The essence of diplomacy is bargaining, which involves the use of both the carrot and the stick. Because of the importance attached to economic diplomacy, some nations appoint highly specialized commercial diplomats.

Economic welfare is a key preoccupation of the foreign and domestic policies of a state. In Marxian perspective, the economy of a nation constitutes the superstructure of the State. It is the economy that determines the ideological values, contours and  national interest of State policy. No economic system, be it capitalism of the West, the command economies of the East or the mixed economic models of Africa, Asia and Latin America can survive without some economic diplomacy of sort.

The centrality of the role of economics in the wellbeing a nation cannot be over-emphasized. This explains why the entire gamut of diplomacy has shifted from political issues to commercial diplomacy. This has become more imperative because of globalization, and the interconnected world made possible by information and communication technology. Thus diplomacy has shifted from political issues to ‘commercial diplomacy’, which embraces foreign trade, external investments, financial flows, aid, bilateral and multilateral economic negotiations and technology exchanges. 

Economic diplomacy is the decision-making, policy-making and advocating of a State’s business interest. Economic diplomacy requires application of technical expertise that analyze the effects of a country's  economic situation on its political climate and environment. Economic diplomacy is derived from the prevailing domestic environment. Nigeria’s characterized by unfavourable economic indicators. Economic diplomacy refers to  the foreign policy support to government’s goal of economic revival and sustainable development. 

The use of political influence and relationships to promote and/or influence international trade and investments, to improve on functioning of markets and/or to address market failures and to reduce costs and risks of cross border transactions.  Typically this subfield of economic diplomacy comprises commercial policy, but also many activities of non governmental organizations  are relevant under this heading. The use of economic assets and relationships to increase the cost of conflict and to strengthen the mutual benefits of cooperation and politically stable relationships, to increase economic security.  

Olu Adeniji observes that “the more affluent and self-reliant the economy is, the greater the possibility for a more independent and influential policy”. Not only are African states unable to exercise adequate influence on world events, they are in most cases, compelled to re-order their foreign policy goals to accord with domestic economic strength and external interests. Because of Nigeria’s mono-product economy, the nation’s ability to generate and expend power in the international system is very limited. For example, Nigeria is the largest producer of crude oil in Africa and the sixth largest oil produces in the Organization of Petroleum Exporting Countries (OPEC), yet the Human Development Report of the United Nations shows that over 70 percent of the 150 million people live below the poverty line.  

Successive administrations have not been able to harness their economic potentials hence the over-dependence on crude oil and the resource curse syndrome. Our over-dependence on crude oil since 1960 shows that the Nigerian economy is in the hands of the capitalist hawks who determine the price of crude oil in the international oil market. The implication is that policy-makers are not in full control of the macro-economic variables that can serve as a push factor of the economy. Thus expected goals and targets are either tangentially omitted or never met at all. Nigeria is not set to benefit from globalization because even when Nigeria deregulates her economy, there is nothing tangible the nation is producing to expand her economic space. That is why Nigeria has entered into a plethora of bilateral and multilateral trade agreements but lacks the political will to create an atmosphere to support Foreign Direct Investment. Nigeria is at best an economic “colony” or “appendage” of the US and the European Union (EU), even bourgeois revisionism cannot dispute this fact. 

These strong economic blocs woo the LDCs with a Promise of enlarging their economic space but they lack the institutional genes and capacity to benefit optimally from globalization. Presently, Nigeria cannot evolve any sustainable economic model to escape the poverty-insecurity nexus. On the contrary, we are running a war economy, with all indices such as infant and maternal mortality, life-expectancy rate, unemployment and low productivity as signals that we are inching towards the slippery slope of failure. In the nearest future, the formal economic space will be narrow even as the criminal economy expands exponentially.  

The capitalist countries in control of the financial giants pretend  to encourage good governance in the LDCs, but they surreptitiously promote ineptitude by granting corrupt leaders and kleptocrats dead weight loans. The giant money lenders know that the LDCs have no strong institutions to use the monies to catalyze development. When such kleptocrats do not feel secure at home they repatriate such monies by stashing them away into coded accounts offshore. Some leaders die and such monies cannot be traced , yet the LDCs are compelled to grapple with such heavy debt burdens. It is a neo-classical, neoliberal economic slavery. 

Since 2007, Nigeria has been professing a new foreign policy paradigm  tagged “Citizenship Diplomacy” was unfolded by the Minister of Foreign Affairs, Chief Ojo Maduekwe, yesterday. It is geared towards “protecting” the image and integrity of Nigeria and retaliates against countries who are hostile and who brand Nigeria as “corrupt”. Ojo Maduekwe administered the foreign Affairs Ministry as though he came down from outer space. He ran like Hussein Bolt without momentum. Besides, he could not rid the Ministry of the stench, but he has not been summoned by the anti-graft agencies. 

The much orchestrated Citizens diplomacy did not witness any fundamental and Nigerians never derived an ounce of benefitted from it. Contrary to the goals of the diplomatic, Nigeria has remained a beggarly nation, with a moribund economy, near collapse of the formal economy and the flourishing of the criminal economy such as oil bunkering, illicit drug trafficking, money laundering and a very high corruption index. The Nigerian economy is gradually running out of steam, as the real sectors have been suffocated. 

The Breton Woods system, to which the economic future of Nigeria is weeded, does not take into consideration the interests of most of the developing countries, especially in Africa who at the time were yet to be independent actors in the international system,. Accordingly, after achieving political independence, developing countries began to demand equitable terms of participation in international economic relations. These demands crystallized in what became known in 1974 as the call for a  “New International Economic Order” (NIEO). This call failed to produce positive results for most developing countries, due mainly to the lukewarm response of the industrialized countries.  

Nigeria is underdeveloped because all indicia of underdevelopment such as inflation, low standard of living, population explosion, and unemployment characterize the economy. Other negative variables include postage stamp cultivation, shortage of human capital in critical areas, political instability and its attendant stagnating negative multipliers. Life expectancy rate in Nigeria has regressed from 51 years to 47 years.  It is about the lowest in Sub Saharan-Africa. And because of the high level of unemployment, dependency ratio is 1:14. The poverty index in Nigeria is unimaginable and unacceptable. While insecurity of lives and property haunts all strata of the population, corruption has eroded what was left of public morality and etiquette.   

Because of the problem of severe  resources, to seek greener pastures. More than 80 percent of youth (graduates inclusive) is victim to mass unemployment. While there is exponential expansion of the educational system, quality has been compromised hence the school system produces graduates that can hardly meet the demands of the dynamic economy. Besides, Nigeria is not industrializing, even as existing industries are mismanaged and rendered insolvent by self-aggrandizing leaders. The implication is that Nigeria imports everything ranging from computer hardware, textiles, office pins, touch light, designer toothpicks, razor blades to killer generators from countries that were at the same level of development about 30 years ago. This trend will be exacerbated because we have collectively entrenched leaders in power who have no moral guiding principles 

If the present conditions persist, the scourge of poverty would reach unimaginable dimensions. The conditions in urban centres would also worsen with more shantytowns, more congested roads, more beggars and more delinquents. The level of the unemployed searching desperately for the means to survive would amply increase crime rates and misery. The very consequences of extreme poverty would be social tension and unrest. As a result, the very notion of national sovereignty would be at stake. 

The cumulative effect of Africa’s growing economic crisis is her worsening political marginalization, with the component states playing peripheral roles in the global scheme of activities. Historically, Africa had always come last behind Asia, Latin America and the industrialized countries in the world scale of wealth and development. Presently, this gap between Africa and the other regions has grown even wider, thus lending credence to Jennifer Whitaker’s description of their status as “pre-modern states in a post-modern World”. 

In the face of persistent economic difficulties, the objective question, which all governments had to address in Africa, is how to salvage their economies from the deep morass in which they find themselves. Similarly, and related to this question was what role foreign policy should play in the process of economic revival? Is it expected, in these trying times, that states should, in their foreign policies, continue to allow un-economic matters to predominate in their external calculations?  

The present reality demands that we take a new look at our diplomacy and make a radical departure from an economically passive diplomacy to a more pro-active, functional and dynamic foreign policy. Nigeria has to In pursuing effective diplomacy, Nigeria needs to all the national energies efforts should be aimed at taking our country to a new and higher economic and technological height. Indeed, it is only in this way that our economic survival can be assured. The success or failure of foreign policy is directly related to a state’s capability to build a dynamic economy. Nigeria’s diplomacy is gradually failing, and the nation has been overtaken by South Africa because of the bogey of cumulative management occasioned by corruption.

The foreign policy of any State is designed mainly to protect and advance the national interest of the people. According to Alfred Thayer Mahan, an American naval officer, “Self-interest is not only legitimate, but a fundamental, cause for national policy; one which needs no cloak of hypocrisy.” As a principle, it does not require justification. Nigeria’s national power is the most important of all interstate controls, and the role of power is central to foreign policy. Decisions concerning national interest should always be made on the basis of concrete national economic advantage rather than on moralistic, legalistic or ideological criteria. Since Nigeria has lost her competitive edge as the economic leader of Africa, Nigeria’s foreign policy formulators and operators should rethink the nation’s diplomacy along the lines of her economic interest. The change is imperative if Nigeria must meet the MDGs and vision 20:2020. 

Idumange John, is a Fellow, Association of Certified Commercial Diplomats, London


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