Government must look beyond taxes, levies for revenue – Amaeshi

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Government must look beyond taxes, levies for revenue – Amaeshi

The Chief Economic Adviser to the Governor of Imo State, Prof Kenneth Amaeshi, speaks with Sami Olatunji, on how government at federal and state levels can navigate the challenging environment to boost revenue and cater to the needs of the ordinary citizens

What would you describe as the biggest economic challenge faced by the Imo State government?

Imo State is blessed with a lot of talents and human capital. As such, the State is amongst the top producers of graduates in the country. Unfortunately, many of these graduates are unemployed because Imo State is not able to absorb all the talents it produces. In addition, there are very few reasonably sized businesses in Imo State, and sometimes the skills available do not match the needs of the market. These issues collectively exacerbate socio-economic tensions. So, I will argue that unemployment is a very big challenge in the State, which can easily breed other societal ills and vices.

Are there specific steps taken to address this challenge?

At the start of his governorship, His Excellency, Senator Hope Uzodinma, CON – the Executive Governor of Imo State – sets an ambitious goal of Reconstruction, Rehabilitation, and Recovery of Imo State. This strategy, which has been dubbed the 3R agenda, recognises the need to address unemployment in the State, as a rehabilitation issue. Hence, the significant focus on youth economic empowerment exemplified in the Governor’s determination and commitment to train 300,000 Imo youths on digital skills for the global digital economy over a 3-year period starting from January 2023. This is the Skillup- Imo programme. The idea, which might be the largest initiative of this sort in Africa, is to enable our youths to participate in the global digital economy gainfully and productively from Imo State. This could be in the form of self-employment or other empowering forms of employment. So, imagine a situation where these youths work from Imo State to support businesses around the world in such areas as web maintenance, database management, process outsourcing, et cetera. These are possibilities that can easily be realised from Imo State. In such instances, some of these youths can earn more than the minimum wage and in hard currencies through self-employment. The number is also significant to position Imo State as the digital skill hub of Africa. This, in itself, is part of the Global Imo Agenda, which the Governor is passionate to achieve. Moreover, with the target to train and engage 300,000 youths, even if the multiplier effect is as low as four extra persons positively affected per candidate (i.e., a couple with two children), which is actually a worst-case scenario, the programme stands a chance of positively impacting at least 1.2 million Imo citizens economically. The anticipated spill-over effects to other sectors and initiatives are immeasurable.   In the SkillupImo programme Cohort 1, the government has trained and equipped 5,000 Imo youths with Industry 4.0 tech skills and startup kits to enable them ply trade anywhere in the world while another set of 15,000 youths are currently being trained in basic, intermediate, and advanced digital skills in the ongoing SkillupImo programme cohort 2.

What other efforts are made to address the challenges of unemployment in Imo State?

Recently, too, and in line with the intention to curb unemployment and empower people economically, the Imo State government is encouraging every kindred/extended family in the State to consider creating a business. This is known as the One- Kindred –One- Business Initiative. OKOBI is an ideology that fosters economic partnership and enhanced wealth growth among kindreds. Recognizing the importance of kinship ties in economic development, and beyond the acronym, OKOBI can also be seen as an amalgam of two Igbo words Oke, meaning great or real, and Obi, place of living or a family. OKOBI provides a platform where individuals from the same family or lineage can collaborate and support each other in their entrepreneurial endeavors. By leveraging the power of shared values, trust, and ancestral connections, OKOBI encourages kindreds to pool resources, share knowledge, and create opportunities for economic advancement. Through strategic partnerships, mentorship programs, and access to capital, OKOBI empowers kindreds to build sustainable businesses, generate wealth, and strengthen the economic fabric of their communities. This approach, which is in line with the original social structure of the Igbo people through the “Umunna” and “Umuada”, has a significant potential of addressing the issues of unemployment and poverty from the grassroots level upwards.

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The government has also invested heavily in market opening and job-creating hard infrastructure. The massive road networks are already supporting businesses and creating jobs. In addition, the dredging of ORASHI River to the Atlantic Ocean, which was launched by the Governor in May this year and is already receiving international attention, will further open up Imo State to the world, attract significant investments, and create many jobs.

The One Kindred One Business Initiative sounds interesting, but what is unique about it?

OKOBI can operate in many ways. Kindreds can choose to own a business outright. Opportunities for co-investment mean people can also decide to invest in an already existing business owned by members of their kindred. That way, the kindred members become shareholders whilst leveraging and respecting the individual agency of entrepreneurship. Beyond filial relationships, OKOBI can also function in supporting networks of groups of people such as friends, members of social clubs, and co-workers. What matters most here is the ability to collaborate in the pursuit of a desirable collective goal effectively and efficiently, whilst leaving no one behind. In short, this version of OKOBI is founded on the principle of nwanne di na mba (meaning that brotherhood or sisterhood is not defined by filial relationships but by shared interests, values, and worldviews). OKOBI is already generating significant interest amongst local people with kindreds starting businesses in farming, services, and manufacturing. Some of these emerging kindred businesses target local markets, but others seek to explore opportunities in foreign markets through Nigeria’s diaspora community. In addition to its potential to transform lives in local communities, OKOBI offers the government an opportunity to formalise grassroots business ventures, grow the economy, and expand its revenue generation capability. These benefits are currently missed opportunities, which OKOBI can help reverse.

What’s the state government doing to bring relief to its people due to hardships emanating from fuel subsidy removal and other policies of the FG? 

Subsidies are useful policy instruments meant to address specific shortcomings – especially welfare issues – in societies. They are hardly permanent solutions. When they are not properly calibrated and implemented, subsidies can distort the market, get into wrong places, and impact negatively on the capacity of the government to holistically assist those they are meant to help.  Based on this perspective, one can argue that the former fuel subsidy in Nigeria fell short of its holistic social welfare aspirations, as it had leakages, created undesirable opportunities, and significantly overburdened the country financially to the point that it affected the capacity of the government to provide essential services for collective social welfare. Moreover, it seems to hurt the saving capacity of the country and investments in critical areas like education, health, and infrastructure. Although it is obvious that the removal comes with its own pains and hardships, I see it as a necessary short-term pain for a much better tomorrow. The Federal Government and the Imo State Government, respectively, have publicised some ideas on how to cushion the short-term negative impacts. The next thing is to implement these ideas and see the work in practice. For instance, Imo State recently made upward adjustments to the salaries of some civil servants. The government has also provided transportation support to the people, as well as free medical care for civil servants amongst other things.  However, implementation is not always a straightforward journey. It involves some experimentation and social learning. As the government tries to implement these ideas, there will be occasional need to shift and make necessary changes based on lessons learnt from the implementation process. Given that it is a new terrain for the government and the people, everyone should also be patient with the process with the knowledge that positive changes, like childbirth, oftentimes come with a lot of pains.

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Do you have any specific advice for the Federal Government in this regard?

Given that this is a socio-economic experiment, in the sense that the impacts are still unfolding, it helps not to be overly rigid with policies and approaches. I can see that the Federal government is already flexible. This should not be seen as a mistake or unnecessary policy somersaults, because there is a lot to learn as the process unfolds. Once the policies and approaches are people oriented, we shall all be fine in the end. Nonetheless, there is a role for opposition politicians and social critics to keep the government on its toes. That’s one of the beauties of democracy. It is hardly a harmonised choir, but one entrenched in contestations and struggles. These continuous contestations and struggles partly inform the innovativeness of democracy. It is rather strange to perceive them as anomalies or unwanted. To accept democracy is to willingly embrace its inherent struggles and antagonisms. True democrats and politicians understand this, and happily live with it.

In what ways can governments at all levels boost revenues without significant negative impact on the masses?

I am a firm believer in entrepreneurship. I do not subscribe to the view that entrepreneurship is limited to non-State actors. The government can be entrepreneurial. This is at the heart of the Entrepreneurial State Movement currently promoted by some scholars and politicians. States can generate revenues through business-like activities. Taxations and levies are not the only sources of government revenues. Some countries with significant natural resources do not tax and levy their people heavily. If the government could focus more on how it can be more entrepreneurial through investments and other business-like activities, it will enhance government revenues and reduce the emphases on taxes and levies. Another approach is to reduce leakages, increase the tax net, and enhance efficiency and trust through accountability. This point on accountability is actually a very important one. In a recent study I conducted on tax and citizens perceptions in Nigeria, we found that Nigerians are not necessarily unwilling to pay taxes. However, they are weary to pay into the proverbial black boxes and dark holes without seeing the benefits of their taxes. So, one quick way to enhance voluntary compliance is to clearly show people how their taxes are spent. This should not be a tall order for any government that truly believes in accountability. It is instructive to note that the Imo State government has made significant improvements in the area of financial accountability since the governorship of His Excellency Senator Hope Uzodinma. These improvements have been recognised by local and international organizations. Only recently, the State received over 12 million dollars from World Bank for transparency and management of the State’s resources.

How is the Imo State government ensuring that businesses thrive, especially with the threat of the sit-at-home that has negatively affected many businesses?

Enabling business environment has become a cliché and is over flogged. In my opinion, the issues are rather straightforward – i.e., the government in collaboration with non-State actors needs to provide hard infrastructure (e.g., roads and telecommunication enablers) and soft infrastructure (e.g., rule of law, quality education, fair taxes, et cetera). Often, the pursuit of enabling business environment is neglected because of perverse incentives and misaligned interests. It only takes political will and a good leader to drive this agenda. It is not a rocket science. In Imo State, for example, the Governor has prioritised the construction of rural and urban roads in the State – including major roads like Owerri-Orlu and Owerri-Okigwe roads which have been completed, and the Owerri-Mbaise-Umuahia road, which is nearing completion. These roads have eased the challenges of transportation, increased property value, and created new economic opportunities, amongst others.

The Governor has also prioritised digitalisation of the State and created the first Ministry of Digital Economy and E-Government in Nigeria. The Imo Digital Economy Agenda 2022-2026, is anchored on six strategic pillars: Digital Literacy and Skill, Solid Infrastructure, Service Infrastructure, Advocacy, Monitoring and Evaluation, Collaboration and Partnership. One of the mandates of this ministry is to provide robust telecommunication infrastructure in the State to support the Global Imo Agenda as the digital hub of Africa. The government has also created the “connected IMO Initiative” being driven as a PPP with the Heartland FibreOptics Nig. Ltd to facilitate the provision of broadband Fibre optics infrastructure across the 27 LGAs with Point of internet Access at public institutions like schools, Markets, LGA head offices, churches, hospitals and Community Centres as well as business districts in the state. The aim is to boost the drive towards achieving a smart and inclusive economy in the State. Businesses sometimes complain of multiple taxes and levies. To avoid such confusions and complaints, the Governor has recently banned anybody apart from the Imo State Inland Revenues Services from collecting taxes and levies from anyone. There are also constant legal and policy reforms to attract and retain investors. Recently, too, the Governor announced N5 billion revolving loan for farmers, and a good number of them are MSMEs.

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How would you describe your role as the chief economic adviser to the Imo State government?

I thank His Excellency, Senator Hope Uzodimma, the Governor of Imo State for appointing me his and the Imo State government’s Chief Economic Adviser.  He has made the role easy for me by allowing me to combine it with my full-time academic appointments at the University of Edinburgh, United Kingdom, where I hold a chair in sustainable business and development, and the European University Institute, Italy where I hold a chair in sustainable finance and governance, respectively. I also hold visiting professor positions at the London School of Economics, United Kingdom, and the University of Cape Town, South Africa. In addition, I am a member of the European Commission High Level Expert Group on sustainable finance in low- and medium-income countries. These roles make it easy for me to do the Chief Economic Adviser job pro bono. Working with Senator Hope Uzodimma is also easy. He is an ideas-person and believes strongly in the view that ideas govern the world. As such, he has remained open to progressive ideas and provided the necessary resources and support for me to operate effectively. There are a lot of positive things happening in Imo State, but one needs to be close to appreciate them. Most importantly, the Governor has been the champion and pioneer of these ideas and initiatives. My role is mainly to help translate those within my remit into practice. In addition, the role has given me a rare privilege to practicalise some of the theories I have developed in the academia. Since the academia is still my primary constituency and community of practice, this combination of theory and practice, I guess, will make me a much better academic.  For this, I am sincerely grateful to His Excellency, Senator Hope Uzodimma, for giving me this rare opportunity to serve Ndi Imo as a Chief Economic Adviser.

In addition to your role, what is your vision for Imo State?

My vision for Imo State aligns with the Governor’s 3R Agenda and the Global Imo Agenda. That is one of the reasons I accepted to work for and with him. Hopefully, one day, Imo State will have full employment, and become self-sufficient and a major player in the world. This vision is strongly behind the industrialisation policy of Imo State, which was launched in November 2022, the Imo Development Plan, which will be launched soon, and the ongoing implementation of SkillUPImo digital programme, the massive development of road networks in the State, the dredging of ORASHI river, and the One- Kindred -One -Business Initiative (OKOBI) to mention but a few. However, occupying a position, for me, is not sufficient. What matters most is what one uses the position to do. Since January 2022 I started this role, my eyes have been on how to make the Imo economy work for Ndi Imo and create enduring practices and institutions that would constitute a legacy. This is my aspiration and I pray for the wisdom and capacity to realise it. So far, we are on course but as they say, time shall tell! And for now, we keep moving.

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