Lorna Izoma
There are several reasons for our terrible economy right now, but the one most affecting us, is our lack of GDP.
What is even a GDP?
Tradingeconomics describes GDP (Gross domestic product), as a measure of the national income and output from a given country.
In layman’s terms, it is goods and services produced within a country, by its citizens.
But lately, the Nigerian economy has not encouraged its citizens especially in terms of entrepreneurship.
There has been a high increase in prices of raw materials used for goods and services production, and lack of protection for already existing entrepreneurs.
We tend to often argue that our inflation is caused by excess money supply in the system, but I doubt that is our present case.
I don’t want to overestimate our government, but I am hoping they know that producing more paper money will cause our country’s economy, hopping on its last legs, to crumble.
However, our core problem is that it is the aggregate supply level has significantly fallen short of aggregate demand.
In an economy that is operating at below full employment, this is a huge problem.
Source: thecable.ng.
I am going to explain with this illustration:
Mr. Emeka is a businessman who has trained Obinna for 10 years.
During this period, Obinna worked and built-up Mr. Emeka’s company and elevated his business.
After Obinna’s years of service, Mr. Emeka provides him with a ‘settlement’ to thank him for his service of 10 years.
This settlement includes a shop, some already bought goods and of course monetary rewards.
Obinna, using the resources given to him by his master, is able to build his own business and thrive.
Obinna thriving, gives credit to Mr. Emeka who is then able to get other young men to work under his tutelage, also with the promise of an agreed settlement.
This gives Mr. Emeka more workers to improve his business, and his students or boys, are gaining experience and have a reward awaiting their hard work.
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But what happens when, if at the end of 10 years, Mr. Emeka does not settle his boys?
He loses credibility, causing less supply of labour to his business.
Which reduces the amount of Obinnas that he trains and sets up.
And like it or not, a country needs Obinnas.
Here, Mr. Emeka is the Nigerian Government and Obinnas are its citizens.
We need more Obinnas (entrepreneurs), to elevate our country’s GDP, which will in turn elevate the country’s economy even if by a little bit.
I doubt we have lack of entrepreneurs, but even if we pumped in one million Obinnas into the system, what help is that if there are no resources?
Will increasing our GDP really help this country’s economy? Will that really help Nigerian's economy?
Leave a comment to answer.