It is my pleasure to welcome you once more to another LEADERSHIP Annual Conference and Awards ceremony.
Since we instituted it in 2008, LEADERSHIP Awards has grown to be the most prestigious in the country. It is also the most credible. We have painstakingly maintained the integrity of the awards and ensured that only those who meet our rigorous selection criteria emerge winners. The internal work that threw up this year’s winners was no less thorough. I take this opportunity therefore to congratulate all the winners in their different categories.
Every year during this ceremony, we choose a very germane and contemporary theme. Our theme for this year, “Towards Financially Viable State Governments”, cannot be more fitting.
The world is changing and our nation is also changing, and any leader who has not noticed this trend already is not worth the trust of the people. Those who lead and those who intend to lead at the state level must come to terms with the fact that it is no longer business as usual. State governments must now think out ways to be financially viable in order to survive. The federal government will no longer be able to maintain state governments like spoilt brats.
I would be saying nothing new if I said that a state governor is the CEO of his state. What would be new is that every state governor is now expected to start operating as CEO in the real sense of the term. A state governor must earn money from his/her state in the same way corporations do for their shareholders, or else the people will start chasing them away from government houses with cutlasses. The days when states would go cap-in-hand every month to the federal government will soon be over because the federal government itself will be too busy struggling to solve its own federal problems. The good news is that every state in Nigeria can survive as a rich entity, with a little imagination from its leaders.
Maybe states will first need some hard times to come to terms with this reality. Lagos State found out the hard way that it could earn much more than its monthly allocations from Abuja when the then President Olusegun Obasanjo illegally impounded the monthly allocations of its local governments for selfish reasons. That was when the governor then, Bola Tinubu, knew the real definition of IGR. Since then the state has not looked back.
States need to develop their own proprietary methods of boosting their IGRs. Lagos chose corporate taxes because that’s where its advantages lie. It could be abundant mineral resources for some, and yet for others it could be massive land resources.
Any state government that gives the impression that it is waiting for a constitution amendment before it can take advantage of the state’s mineral resources is simply dumb. State governments can apply to the federal government for mining leases in their states and simply become mineral-rich. The problem is that no state has been able to do this. Some states are succeeding with agriculture, especially rice cultivation using the CBN intervention funds. It is the same logic.
Botswana is a small rich country in southern Africa that is rich in diamonds, just as several Nigerian states are rich in different solid minerals. Botswana got rich because its leaders were smart enough to invite De Beers of South Africa, the world’s largest diamond mining company, into an investment arrangement with the government, and that led to the formation of a company called Debswana in a 50:50% shareholding. Botswana as a country did not put in a dime into the arrangement; its mines made up its equity of 50%. Today Botswana is one of the fastest-growing economies in the world and has been so for decades mainly on account of its partnership with De Beers. This Botswana model will work perfectly for any serious state government in Nigeria.
So why wouldn’t mineral-rich state governments enter into such partnerships with the private sector? The mining sector would have even developed if state governments competed in these areas and all they would have to do is develop infrastructure to the mining sites.
Another model is the Atlanta model. The Hartsfield-Jackson Atlanta Airport in the United States is the world’s busiest airport. But how many people know that the airport was built and is owned by a local government, the City of Atlanta?
A long time ago, the city of Atlanta was a poor local government in the state of Georgia in the United States. The leaders sought a way out of their poverty. They therefore decided to leverage their comparative advantage – their location on the map of the United States – and decided to make Atlanta the gateway into the US. They took loans, built what is now called Hartfield-Jackson Airport, named after the mayor that initiated the idea. Today, the airport is the busiest in the world, raking in billions of dollars; and, as a result, the City of Atlanta is one of the richest local governments in the world today.
Well, these are just a few ideas. There are several more. I will leave the rest to people who want to be state governors to start debating among themselves on how to make a difference. But it is important to know that, just as nations are in competition, Nigerian state governments will need to start competing among themselves for prosperity. That was precisely what happened among the regional governments in the First Republic. And that was why the regions were self-sufficient and accomplished all they did at a time there was no oil money.
Once more, welcome to this conference and feel free to go in whatever direction the spirit leads.
We remain yours,
For God and Country!