Understanding Amaechinomics

Experience and research has proven that understanding and dialogue are the two desirable features in any progressive venture, be it economics, politics, social and even at interpersonal level.

It is a common knowledge that governor Amaechi’s Economic philosophy and its impacts relative to the State GDP and Human Development Index in the last four years have attracted series of comments and public attention in recent times.

Governor Chibuike Rotimi Amaechi in his address to the South-South Committee on 1999 Constitution Review in Port Harcourt promised the people that “it is about reforms and changes that touch human lives. I stand on the side of the people to identify with you on this journey to make history”. In the same vein, he stated “we need to pursue education reform, infrastructure of schools, entrepreneurship and development of infrastructure to support economic growth and create employment opportunities”.

Also, during his 2010 Budget Speech, he said, “We are emboldened by our courage of conviction that we have no alternative than to confront our development challenges regardless of the costs. To choose to do otherwise will amount to a betrayal of the yearnings of the majority of the poor population of Rivers State”.

The big question has been whether the promises have been delivered or in the realm of deliverables. If yes how, has it reflected in the living standard of the people?

Also considering the enormous strategic value of Rivers State, which has great significance for gauging the general health of the national economy, coupled with the primordial role of political leadership in determining the performance of their economies and the wellbeing of a citizens, it is imperative that I take more than a passing interest in knowing the overall economic objective of government, strategic policy direction and how the economy is generally being managed and optimised for the common good. As one German philosopher would say “our lives begin to end the day we become silent about things that matter”.

I therefore considered it a professional and ethical responsibility to make this contribution which seeks to achieve three main objectives with hope that government and the governed will have something to learn. They are: (i) The Efficacy of Amaechi’s Economic Model – Amaechinomics. (ii) the State Economic Performance & its Impacts on the People and (iii) the way forward .

(i)         The efficacy of Amaechi’s economic model –”Amaechinomics”

The efficacy of Amaechi’s economic Magna Carta referred to in this work as the administration’s economic model  Amaechinomics is traced to the perceived impressive social welfare indicators predictive of brighter economic outlook and emerging economic miracle in the state in spite of obvious fundamental challenges.

Various study group including policy circles experts review groups, scholars, business round table and international investors have taken deep interest in raveling the mystery of Amaechi’s economic philosophy with a view to taking full advantage of the emerging economy. The model which is referred to in the work as Amaechinomics is my coinage.

Experts liken Amaechinomics to the former  British Prime Minister, Tony Blair’s Ten Principles of conflict Resolution which is currently being studied globally. The concept of Amaechinomics is defined as “The grand united strategies for a holistic economic transformation of Rivers State based on strategic trianagle of quality, time and cost as key success factors and guided by entrepreneurial discipline with public private partnership as its cardinal strategy for infrastructure reforms”.

The model seeks to synergise with the organised private sector and is anchored on leadership accountability, good governance and value reorientation as key pillars. It is driven by government; determination to reverse the negative socio-economic indices and entrapment policies of the past and engender optimal resource utilisation, create economic growth sustainability and usher in a new Rivers State as a preferred destination for tourists and investors in Nigeria and sub-saharan Africa.

(ii) The state economic performance and its impacts on the people.

It is particularly important to note that, of the three basic sectors, government business and citizen that interact to perform different but complementary and collaborative roles to promote sustainable economic growth and development, the role of government is most critical in determining the performance of the economy and the wellbeing of its citizenry.

As a keen observer of this administration. I have studiously gone through various publications including reports of International Rating Agencies on the performance of the state economy, government regular accounts of stewardship and having critically analysed the state annual budgets as a key fiscal instrument for economic management and self assessment, I have the conviction that there is huge ambition to transform the state with the speed of cyclone through government massive investment in physical infrastructure, human capital development, education, health, power, agriculture and security in order to reverse the negative socio-economic indices of the past and therefore lay a solid economic framework as a base to restore investors confidence, improve its credit rating profile.

According to World Bank, it is estimated that every 1 per cent of government fund invested in infrastructure leads to an equivalent 1 per cent increase in gross domestic product (GDP). This, perhaps, accounts for the massive economic expansion across all sectors simultaneously with expected impacts ranging from short, medium to long term.

Although there was no reliable data to measure with certainty the size of the state GDP, casual evidence suggests that Rivers State is the second largest economy in Nigeria with estimated annual budget of N455 billion ($3 billion). This is higher than budgets of most African nations with estimated population of about 5.6 million people.

The administration’s perception of the state economic problems, and its determination to finding a lasting solution reaffirmed to me the appropriateness of the Amaechi’s economic philosophy, his vision to improve on the above standard and the assertion that when strong and focused leaders are willing to work, the odds of reaching the optimal multiply exponentially.

By dint of hard work, tenacity of purpose and policy consistency, the multifaceted economic model of Amaechi led administration has in the last four years re-designed the state’s political economy by impinging in every sector of the economy. It is my expectation that some of the projects and initiatives now at advanced stage of completion will greatly ameliorate the poverty level and harrowing experience of the teaming masses of the Rivers people.

Furthermore, the observed progressive reduction in the State Budget Expenditure pattern, increased ratio of capital to current expenditure, the culture of building reserve for future generation, increase in internally generated revenue (IGR) and the fiscal operation overall surplus of N32 billion in 2010 are practical indications of government strict adherence to budget discipline, prudent management of public fund and changing course of development.

Also, the state current ranking of B+ and AA- on a national long term rating by international rating agencies is a clear signal of positive impact of government economics philosophy towards building an economic system that is open and fair, devoid of feudal system where those in power decide who become rich or poor.

Within the last four years, it was discovered that loans facilities were extended to about 889 indigent beneficiaries to boost credit at grassroots level. The aim was to promote small businesses, engage the creative minds of our youths and ensure that those poor persons who are economically active in the rural areas are not left out. Based on this, I am inclined to belief very strongly. Roosevelts’ assertion that “the best of our progress is not whether we add more to the abundance of those who have much. It is whether we provided enough for those who have too little”.

The performance of the state economy can best be summarised in the words of Chief Emeka Anyaoku, former Secretary General of the Common  Wealth, “… I could see Rivers State is fast approaching a level of development and from what I have seen it is wonderful …” I also quite agree with Rev. Jessie Jackson that “Amaechi represents the future and hope of the country”.

(iii)       The Way Forward

In as much as Nigeria’s experience with Public Private Partnership (PPP) model has been generally considered successful with numerous upsides, experts  still believe that there are important risks to be critically considered. Also, the need for careful evaluation of key success factors and sustainability is required.

Accordingly, to effectively plan, design and proactively manage, “PPP Model” requires good Financial Risks Management, appropriate monitoring and management of quality and performance, efficient evaluation mechanisms and key performance indicators. A careful review of Decision Making processes, rewards and benefits, accurate up-front evaluation of possible trade-offs, responsibilities, and the applicable contractual and regulatory framework is also required.

It is therefore imperative to recommend for regular evaluation and reviews of PPP projects in the state, utilizing internal and external oversight methods to ensure continuity in the monitoring and management of quality and performance. This has a further advantage of forestalling operational risks emanating from inadequate regulatory framework and low institutional capacity etc.

Finally, according to Arthur Livingstone, “….. planning is both an act of government and response of the people, requiring the authority of the first to give it shape and the participation of the second to make it work”.

The present government has provided the future shape of the state economy driven by its economic model Amaechinomics, it is our responsibility to make it work through active and constructive contributions in the overall interest to build a virile economy and make the state a choice investment destination.

It is on record that no matter how well a programme may be, it will not work in practice unless supported by the people. This is the time for all professionals, best minds and the brightest of the political class including the combined strength of the youths and the wisdom of the old to shun atomistic thinking, perpetual war with ourselves and get involved. It is a silent state economic revolution that needs the support of all.

I mean, the kind of involvement and support that will compliment government’s efforts and develop a mindset to get back what we gained from the system, realising that there cannot be sustainable wealth creation without sustained interest in value added for the common good of our people.

Jaja, a banker and public affairs analyst, wrote in from Port Harcourt.

Isaac Mietamuno Jaja