The electricity ‘minus’ in socio-economic development

When the incident of the death of two children, aged 2 years each, who died in a fire outbreak resulting from a fallen candle was reported in the media last week, it opened the already sored surfaces of an ever-ailing power generation and distribution sector in the nation.

A candle had been lit to provide some form of light, but it ended up on a sad note as the candle reportedly fell on the sleeping mat and engulfed the apartment where the children had slept.

Certainly, help came a bit late because the neighbourhood must have been overtaken by noise from generators of all kinds.

The incident was just one reported out of several others that happen almost on a daily basis. Of course, no amount of lamentations will bring the dead back to life.

But with the incident, the larger society is quickly reminded that as much as people struggle with the challenge of not having regular electricity supply, businesses suffer too.  And in this case, the contributions of the small and medium scale enterprises to economic development get truncated, forcing the unemployment figures up.

Notably, by the turn of the last decade, one of the strategies of the agenda for the Millennium Development Goals relied significantly on promoting the SMEs on all fronts. It was meant to serve as an evident achievement of the poverty alleviation action points.

From that time, government at the various levels set up different skill acquisition programmes including strengthening the National Directorate of Employment (NDE) training which had been established earlier in the 1990s.

Young school-leavers and semi-literate women who were trained in hair-dressing, barbing, cobbling, food processing, welding, and other skills were excited. A number of them were actually given start-up tools to practise their trade, while it was hoped that by the end of every training programme there would have been a reduction in the number of unemployed people, especially the youths.

But years after the skill acquisition programmes started and few months into 2015, which was proposed to be the year to celebrate the MDGs, the situation on ground is far from the initial expectations. In major cities across the country, where the SMEs had hoped to strive, the epileptic power supply made it difficult for the businesses to survive.  Those who turned to generating their own electricity did so at a much higher cost than could sustain the continuity of their businesses.

The situation had not been any different with those who got into the supposed mechanised farming. Rather than use available technology to increase farm produce, the non-availability of electricity either forced some of the operators out of self-employment or made those who decided to remain to return to the old and crude method of farming, since it did not demand the use of electricity to run their farms. Of course, the result was low yields and more unemployed people.

For the medium-scale businesses that continued to run, the consumers paid the bills, as pushed down into units of items. On the long run, the role of the SMEs in the development of the economy has been thinned into insignificance. They probably just occupy the position of filling in the gaps, and doing more of mere support for big businesses than impacting the economy in terms of job provision.

Good enough, the calls for foreign investors to Nigeria is a welcome move.  However, it should be noted that such foreign investments can only be truly rewarding if there is adequate provision of first, electricity supply, and every other vital amenity to run a functional and efficient business that can create more jobs and make goods and services available and affordable.

Copyright Ships & Ports Ltd. Permission to use quotations from this article is granted subject to appropriate credit given to as the source.