October 10, (THEWILL) – There are concerns that Nigeria’s deepening revenue challenge may escalate into a financial implosion, with the 36 states and the Federal Capital Territory (sub-nationals), being the worst hit. The situation is aggravated by the nation’s escalating public debt stock (now at N33 trillion). The debt stock comprises domestic and external loan obligations of the Federal Government and the sub-nationals.
With over 80 percent of the nation’s revenue committed to debt servicing annually, governments at all levels are struggling to survive. There is little left for capital budget, pay salaries and undertake other priorities to grow the economy. Moreover, there is a limit to which the people and corporates could be taxed. Yet, profligacy takes the centre of our governance space while frugality assumes the back seat.
As such, the sub-nationals are hemorrhaging huge resources in paying salaries and other emoluments of a bloated bureaucracy. To survive, they are urged to diversify their resource base, embark on aggressive internally generated revenue (IGR) and depend less on the shrinking federal allocations.
The purpose of the State of the States project, is to present evidence-based alternatives. These include avenues for the sub-nationals to become more viable and less dependent on the Federal Accounts Allocation Committee (FAAC) – referred to as Abuja handout.
State of the States, a bi-weekly publication, will feature two states per edition. It endeavours to unearth hidden treasures in each state and ascertain, through consultations and evidence-based survey, areas of comparative advantages and economies of scale. The publication will show-case, in no exaggerated terms, the socio-economic status of each state and highlight the opportunities and threats.
Furthermore, State of the States will examine existing realities that hinge on sector-specific areas of competitive advantage – Agriculture, Tourism, Transportation, Education and Skill Acquisition, Wellbeing and MSMEs. Ultimately, the project seeks to create the desired spotlight on the sub-nationals to motivate them into something different for better results. We have featured Lagos and Ogun, Kwara and Kogi, Anambra and Enugu, Benue and Taraba, Kebbi and Sokoto.
This week periscopes Cross River and Akwa Ibom.
Cross River State was created on May 27, 1967 from the former Eastern Region of Nigeria. Its capital is Calabar – a major city and business centre. It derived its name from Cross River, one of the major rivers in Nigeria. It is a coastal state in the South-East and located in the Niger Delta area. The state shares boundaries with Benue State to the north, Enugu and Abia States to the west, the Cameroun Republic and Akwa-Ibom State to the west and south, respectively.
Cross River belongs to the tropical rainfall belt where rainfall is usually seasonal and at times, very heavy. Humid tropical climate of about 1300 – 3000mm rain fall and 30°C mean annual temperatures prevail over the state, except on the Obudu Plateau, where the climate is sub-temperate, with temperatures of 15°C – 23°C. The vegetation ranges from mangrove swamps, through rainforest, to derived savannah and montane parkland. Its coastal location gives it a huge advantage for maritime business of different types.
Local Government Areas: 18
Land Area: 7,782sq mi.
Population: 3.7 million @ 2019
Registered businesses: 868
Public primary schools: 1,020 (circa)
Public secondary schools: 290 (circa)
University: (4): Federal – 1, state – 1, private – 2.
Polytechnic: (5): Federal – 1, state – 1, private – 3
College of Education: (2): Federal – 1, state – 1
College of Agriculture: State – 1.
Nursing School: (7): Midwife & nursing -5, psychiatric – 1, Mental health -1
College of Health Technology: State – 1
Technical school: State – 3.
Total Revenue: N49.07bn @ 2020
Total Tax: N12.76 bn (2020)
IGR: N16.18 bn @ 2020 (32.98% of total revenue)
FAAC: N32.89 bn @ 2020 (67.02% of total revenue)
Domestic Debt: N163.16 bn @ 2020
External Debt: $192.47m @ 2020
Unemployment rate: 27.9 @ 2010
Airport: (3): Margaret Expo International Airport Calabar; Calabar International Airport, Bebi; Obudu Airstrip.
Seaport: Calabar Seaport.
Cross River State is blessed with the following proven natural resources: Forest wood, limestone, clay, salt, tin, granite, basalt, quartzite, kaolin, sand and feldspar. There are other mineral substances said to be under investigation by geologists. These include lead, zinc ore, manganese, gold, uranium, titan, mica and gypsum.
Robust Tourism Sector
The state is already on course in tourism development. The annual Calabar Festival, which attracts participants and tourists from across the globe, is highly reputed as exceptional among the states. The Obudu Mountain Resort attracts visitors all year round. The Tinapa Business Resort project, which has suffered some execution setback, is a major tourism project that is adjudged a potential cash-cow
The other areas that are being developed/expanded or marked for development include:
• The soaring plateaus of the mountain tops of Obanliku.
• The Obudu Mountain Resort being expanded.
• The Rain forests and mountains,
• Walkway Canopy of Afi with 4-km cable car ride over the mountains
• Waterfalls at Agbokim and Kwa.
• The Monoliths at Ikom.
• Cross River National Park at Boki
• Obubra Lake at Obubra.
• Etanpim Cave in Odukpani.
• Game Reserve at Okwangwo and Boki
• Calabar Marina Resort (which houses the Calabar Slave Museum, the Cinema and a view of the Calabar River where one could take a boat ride around or to Oron in Akwa-Ibom State).
• Calabar Residency Museum and Mary Slessor Tomb.
The state’s economy is powered mainly by agriculture, which accounts for 70 per cent of employment in the area. Investment in infrastructure and modern inputs, such as fertilizer, seeds, tools and agro-chemicals has proved effective.
The state’s major agricultural produce include oil palm, rubber, cocoa, cashews, cassava, yam, rice, plantain, banana and coco yam. Others are maize/corn, groundnut, mangos, oranges, sugar cane and pineapples. Fishing, live stocks, sea foods and poultry are also practiced by the people. Cross River also has a world-class slaughterhouse that does about 6,000 birds per day.
Agriculture, Tourism Will Drive Cross River’s Economy Beyond Oil
Cross River State is blessed with vast hectares of land for the cultivation of different kinds of crops, both for local consumption and for export. The people recognise this and devote their energy towards exploring existing opportunities that are huge and identifiable.
The following have been identified among the requirements to enhance agricultural production in the state include:
• Construction and equipping of skills acquisition centre for aquatic farming.
• Agricultural training and empowerment of youths and women.
• Supply of mobile fish pond and feed to rural farmers in selected communities.
• Rice mills with de-stoning facilities to promote Nigeria rice value chain.
• Construction of feeder roads to enhance movement of farm produce to the markets.
• Assistance to co-operative farmers in the areas of crops, pesticides, seedlings, farm implements, fertilizers, among others.
• Agro processing, productivities enhancement and livelihood improvement support.
• Empowerment of SMEs for the cultivation of cash crops to support backward integration in the agribusiness supply chain.
The state has taken advantage of the ban on rice importation to commence large-scale rice cultivation. Cross Rice, the state’s flagship agricultural project is a multi-billion naira commercial agriculture development project jointly promoted by the Cross River State Rice Company Management Board, the Central Bank of Nigeria and Sterling Bank.
Cross River State Rice Company Management Board provides land, funding, farm inputs, mechanisation facilities and serves as off-takers for the rice paddy produced by the farmers.
The scheme has recorded the participation of over 2,000 people at various levels who maximise the use of commercial and mechanised farming methods. The government is making efforts to increase its rice production.
The state recently commenced the G-Money initiative to boost agriculture and provide job opportunities for the youth. The project is in partnership with an American agriculture equipment firm, John Deere, towards agro-mechanisation across the rice value chain.
The Governor, Ben Ayade, confirmed that the state have taken delivery of a large number of tractors, bulldozers, pay loaders and excavators to drive this project.
The niche that Cross River has carved for itself in tourism, if strategically driven and supported with the right policies and enabling environment, will give it the best comparative advantage among the Nigerian states.
Challenging situations to address: Insecurity, policy inconsistency of government, multiple taxes, extortion, poor power supply and terribly bad road network.