On April 4, 2017, the Nigerian Extractive Industries Transparency Initiative (NEITI) dropped a bombshell. The Nigerian National Petroleum Corporation (NNPC) had failed to remit over $21.8 billion (about N7.2 trillion) into the Federal Government account. The unremitted N7.2 trillion is the total value of the 2017 at N7.298 trillion, Nigeria’s largest budget ever.
The NNPC has however consistently denied any wrongdoing over its failure to remit the money to the Federation Account, stating that the funds were used legally in running its operations, while the balance had been deposited in the Central Bank of Nigeria.
“If we were to base the unremitted fund on the current budget, the implication is that Nigeria could have easily got N2.24 trillion in capital expenditure (infrastructure) as is in the 2017 budget,” Dupe Adebayo, a Development Specialist said.
With the N2.24 trillion, Nigeria could have provided infrastructure in sectors such as health, housing, road and power, water and education, four key areas that could have contributed to poverty reduction in the country, she reasoned.
Recall that Nigerian government had budgeted N529 billion for power, works and housing; N85 billion for water resources; N81 billion for industry, trade and investment; N51 billion for health; N142 billion for education (and UBEC) and N94 billion for development of Niger Delta region (and Niger Delta Development Commission); as well as N262 billion for transportation, bringing the total projected investment to N2.24 trillion for 2017. These key investments in capital expenditure “could have helped contribute to development and lifted millions of Nigerians out of poverty,” a development expert, Olusola Adetiba said.
Implications of N2.7 trillion lost to NNPC in health, water and sanitation
“Once there are deficits in health infrastructure, it will negatively affect access to healthcare services and thus patients that need care won’t get it and they will remain sick. Ill-health precludes people from working and thus they can’t earn income, thereby propagating poverty,” Dr Michael Olugbile, Harvard-trained Public Health expert, explains what infrastructure deficit in health sector means to Nigerians living in poverty.
Top health and water-related issues in Nigeria
“Preventable or treatable infectious diseases such as malaria, pneumonia, diarrhoea, measles and HIV/AIDS account for more than 70 per cent of the estimated one million under-five deaths in Nigeria,” UNICEF has said.
Malaria in Nigeria is responsible for 60 per cent outpatient visits to health facilities, 30 per cent childhood death, 25 per cent of death in children under one year and 11 per cent maternal death, according to the Nigeria’s Federal Ministry of Health. The ministry adds that the financial loss due to malaria annually is estimated at N132 billion in forms of treatment costs, prevention, loss of man-hours, among others.
Nigeria loses over $1.5 billion in GDP to vitamin and mineral deficiencies, every year, the World Bank had said. Nigeria is one of the six countries that account for half of all child deaths from malnutrition worldwide, according to UNICEF. Every year, one million children under-five die, 50 per cent of them due to causes attributed to malnutrition, the agency also said.
Maternal and child mortality
Nigeria constitutes two per cent of the world’s population but contributes 10 per cent of the world’s maternal mortality, the United Nations Population Fund (UNFPA) said in 2016. Almost a million children die yearly in Nigeria, following data from the UNICEF, which indicates that Nigeria loses about 2,300 under-five year olds and 145 women of childbearing age “every single day.” This makes the country the “second largest contributor to the under–five and maternal mortality rate in the world,” according to UNICEF.
An estimated 2.9 million Nigerians (mostly females) are living with the HIV, the UNICEF reported, adding that at 4.4 per cent prevalence rate, the “epidemic is also increasing the population of orphans in the country, which is already estimated at 7 million.”
“The unfortunate thing is that,” Dr Olugbile said, “it is the poor patients that usually don’t have access to healthcare and will be most affected with the deficit as the rich can afford to get services from elsewhere both within and outside the country.”
What unremitted billions, lack of infrastructure and poverty have in common
Lack of investment in economic and social infrastructure is costing Nigeria billions of dollars in revenue that could help improve and sustain livelihood of the country’s citizens, experts are saying. With N2.24 trillion out of N7.2 trillion trapped in the NNPC, the implications are that Nigeria is unable to provide adequate infrastructure such as clean sources of water, health and education facilities, markets and proper transport access to its citizens, thus exacerbating poverty-induced consequences on Nigerians, and further increasing economic losses incurred by the country.
Infrastructure deficit widen the poverty gap, Kayode Ajayi-Smith, Executive Director, Joint Initiative for Development said in an interview with this reporter. According to him, infrastructure deficit in education, health and sanitation would not only widen the income inequality gap, it will, over time, lead to increased violence in the country, considering that Nigerian population is made up of mostly young people.
“The population in swamps is increasing and it is estimated to increase to 20 billion in 2050, most of them in developing countries. If that amount of money is invested for instance in housing, it will reduce the potential of communicable diseases.
“You also know that our population is rising. If our population is rising and we are talking about achieving demographic dividends, we also need to think in terms of empowering women and girls because demographic dividends cannot be achieved without empowering women which means we need to invest in education,” he said.
It is estimated that Nigeria’s population will increase to over 400 million by 2050, which means if investments are not made in developing the country, the cycle of poverty will continue, which signals dangerous trends for the country, relative to unemployment, high increase in illiteracy and violence, Ajayi-Smith said.
Nigerian Tribune News