Technological imperative of productivity growth

Yomi Makanjuola

Yomi Makanjuola, who has joined Business a.m.’s board of elite contributors from the United Kingdom, earned a doctorate in Materials Engineering & Design and worked primarily at Accenture as an Associate Partner in Nigeria. Currently, he is a private management consultant and author in the UK. His most recent book is Nigeria Like A Rolling Stone, now available at https://amzn.eu/d/8SRPZ0n 

In a world characterised by order and entropy, the natural human instinct is to use technology – from the most rudimentary to the cutting-edge – to forge a better future. Historically, glacial improvements preceded the invention in the 18th century of the steam-powered engine. Earlier on, land transportation, agriculture, and mining all relied on draft animals and manual input for propulsion, whereby animal-drawn carts and brawny men hoisting rocks signified the limits of physical exertion. Handily, since the horse was the essential agent deployed to perform work, horsepower became the standard unit of power output. 

Credited to England, the First Industrial Revolution signalled an inflection point that advanced the correlation between productivity and economic growth. Broadly defined, productivity represents the “increase in the value of outputs generated over a given period of time for a given amount of inputs.” This explains why China and India, the world’s most populous nations, by and large had the largest economies on the basis of commensurate agricultural output. Circa the mid-19th century, mechanisation altered that antiquated trajectory when machines began to simulate and augment human labour.

Thereafter, fertiliser production on a commercial scale transformed agriculture for ever. Effectively, a spike in food productivity freed up labour for manufacturing, which fostered a rural-urban drift. Step-change improvements in basic human needs, including food, shelter and clothing, were accompanied by ubiquitous disrupters like locomotives and telegraphy, which acted as connective tissues that collapsed distance.

Significantly, the advent of the internal combustion engine, an upgrade to the steam engine, and electricity saw the dawn of the modern age. Like clockwork, an uptick in Western living standards paralleled enhanced productivity. At the personal level, productivity describes how efficiently and skilfully an individual completes set goals or tasks. At the national level, higher aggregate outputs bolster wealth creation.

In due course, widespread innovation during the 20th century undergirded consumerism and free markets, which inspired products and services people never knew they desired. Strikingly, an unprecedented vista unfolded that comprised three synergistic payoffs, namely faster, cheaper and better. Driven by competition, consumers began to demand better outcomes, delivered faster, and routinely cheaper. In time, individual nations began to accentuate their comparative advantage relative to trading partners.

However, in order to industrialise sustainably, an aspiring nation is obliged to diffuse empirical knowledge – in science, technology, engineering and mathematics – and to stay competitive by innovating continuously. Absent technological innovation, and productivity tends to flatline, as exemplified in Nigeria. Incidentally, on the rare occasions when Nigerians innovate, usually it is in fungible fields such as fashion, music, and recreation.

Despondently, Nigeria has failed to lay the foundation for industrialisation, which would have opened a gateway to more value-added opportunities. Seemingly stuck in a rut, economic output per head in the broader sub-Saharan region has barely budged since emancipation from colonial rule. Despite open-source access to requisite technologies and know-how, why have countries like Nigeria and others in the so-called Global South remained poor? Specifically, is Nigeria’s inability to pivot to developmental orthodoxy merely a feature or a bug?

A symptomatic feature of Nigeria’s underdevelopment has been successive government’s inability to grasp the impossibility of building a modern economy without reliable sources of electric power. Requisite investments in public infrastructure for long-term economic growth were either shelved or misappropriated. In the third decade of the 21st century, the incessant collapse of Nigeria’s power grid highlights the country’s perennial underperformance, by generating only a tiny fraction of its electricity demand.

To suggest that Nigeria has a wholesale or systemic bug deterring national development sounds somewhat hyperbolic. But is it? Apart from the upstream oil and gas industry which relies on borrowed technology, and a hyperactive informal sector, Nigeria remains largely an agrarian, low-skilled, low-productivity economy. Either due to a failure of imagination or benign negligence, the nation’s bureaucracy cannot render accurate information for national planning. Equally guilty, lawmakers and policymakers implement policies with barely perceptible impact on economic output.

Perhaps short of ideas, fringe activists periodically upbraid and solicit former European imperialists for reparation payments. But, incongruously, Nigeria’s massive oil wealth – running to hundreds of billions of dollars – was mismanaged by post-independence administrations. In truth, heedless investments and blatant venality hobbled the economy, not lack of money. With that track record, therefore, illusory reparation funds would only lubricate a corrupt pipeline.

To recap, it could be surmised that modern civilisation took off with the breakthroughs induced by paradigm-shifting inventions like electricity, telephony, penicillin, and air travel. At the cusp of the Fourth Industrial Revolution, digital technology is driving accelerating change, with artificial intelligence, quantum computing, and genetic engineering at the leading edge.

Ironically, Nigerian knowledge workers in the Diaspora are renowned for punching well above their weight at many of the world’s leading institutions. Regrettably, none of that expertise and dynamism has taken root on Nigerian soil where, inexplicably and inexcusably, mediocrity is exalted and talent is buried alive. Barring an urgent course correction this century, is post-oil Nigeria destined to fall further behind?

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