Why Nigeria must invest in human capital development to boost economy

*We’re committed to boosting development at all levels – Ahmed

Experts have attributed growth of any economy to the huge investments on the human capital of the state, which according to them serves as the major drivers of economic growth and development.

According to them, if Nigeria doesn’t invest in its huge population and make them productive, the population may be huge liable and burden to the economy.

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Furthermore, the immense support and investment in human capital development in Nigeria to ensure adequate drivers of economic growth cannot be over-emphasised.

On one hand, human capital development is very key in that economic growth is the most powerful instrument for reducing poverty and improving the quality of life in developing countries. Both cross-country research and country case studies provide overwhelming evidence that rapid and sustained growth is critical to making faster progress towards the Millennium Development Goals (MDGs) – and not just the first goal of halving the global proportion of people living on less than $1 a day.

On the other hand, growth can generate virtuous circles of prosperity and opportunity. Strong growth and employment opportunities improve incentives for parents to invest in their children’s education by sending them to school.

This may lead to the emergence of a strong and growing group of entrepreneurs, which should generate pressure for improved governance.

However, investing in the country’s huge population for the desired growth is hugely determined  by its leadership, policies and institutions, as human capital development, appears to be at the centre of it all, be it leadership, policies or institutions.

In line with the federal government’s economic objectives, Zainab Ahmed, Minister of Finance, Budget and National Planning, say that the country has plans rolled out in the area of human capital development with collaboration of international financial organizations.

“Well, we need support in human capital development as the World Bank has already done quite a lot of support in this sense.

“For example, the child education support that is being designed in the country is only for $10 million. Nigeria is a population of 200 million people. Let me say that 60 per cent of our population is below the age of 45 and within the 60 per cent, more than half are young children of school age.” She said

According to her: “We also have the challenge of having the highest number of out of school children in the North East which has worsen the indicators significantly. So, we need to concentrate on investing in the education of our children, and when that is done, it is actually investing indirectly in the Nigerian economy.” 

Analyst and stakeholders in the financial sector say a strong economic growth therefore advances human development, which, in turn, promotes economic growth. But under different conditions, similar rates of growth can have very different effects on poverty, the employment prospects of the poor and broader indicators of human development.

They added that the extent to which growth reduces poverty depends on the degree to which the poor participate in the growth process and share in its proceeds. Thus, both the pace and pattern of growth matter for reducing poverty.

Furthermore, the successful strategy of poverty reduction must have at its core measures to promote rapid and sustained economic growth.

This doesn’t come without challenges especially in policymaking, combining growth promoting policies with policies that allow the poor to participate fully in the opportunities unleashed and so contribute to that growth.