On 5 April 2023, the Nigerian Minister of Finance, Budget, and National Planning, Zainab Ahmed, disclosed that the Nigerian government had secured an $800 million loan from the World Bank to share as palliatives to about 50 million poor Nigerians. The good news came in the context of unprecedented inflation in the country with many Nigerians unable to afford basic needs. However, as good as the government’s intentions may look, social intervention programmes such as cash handouts to the poor will not eradicate poverty in the long term; it is simply a temporary bandage to stop the bleeding. Alternatively, Nigeria and indeed Africa could take inspiration from long-term models which were effective in completely eradicating poverty elsewhere. Consider the Chinese model.
Experience shows that cash handouts remain a short solution to a structural issue. Whether in Malawi where school girls were given unconditional cash transfers or in the case of the Lesotho Child Grant Program, research has shown that while such interventions can bring short-term benefits, the cash is never enough to actually pull people out of poverty in the long term. Similarly, in Uganda, experience has shown that the positive effects of cash handouts on employment and earnings disappeared after nine years. This speaks to the failure of cash to remedy structural issues, as its long-term effects are often limited, according to experts. This means that African countries such as Nigeria need to apply a new approach and perhaps a country like China which has been in the same situation could offer valuable lessons.
Within four decades, China was able to lift 800 million of its citizens out of poverty, thereby completely eradicating extreme poverty in the country. The Chinese made such drastic gains through a broader understanding of poverty as not just a problem of lack of income that occasional cash handouts can solve but a multidimensional issue. Also, the country’s top leadership made poverty eradication its top political priority, not for years but for decades in order to win the battle against poverty. Therefore, to lift Nigeria’s 133 million multidimensionally poor and Africa’s 460 million poor out of poverty, all factors that keep a population in poverty must be put into perspective in designing and implementing poverty eradication programmes. Nigerian and African political leaders must make poverty eradication their topmost long-term priority.
Just like the Chinese, a successful poverty alleviation programme in Nigeria and Africa will target to provide every citizen with the assurances of basic necessities such as food and clothing, basic medical services, safe housing with drinking water and electricity, and free and compulsory education. To achieve this, every poor person in Nigeria and Africa must be individually identified, tracked and empowered, which was what China did.
In addition, from the Chinese experience and success story, Nigeria and other African countries can adopt some of the other methods the Chinese employed in their poverty alleviation programmes. First, African countries will need to develop the local economy in poor areas through access to financing (credits, loans, subsidies), technical training, new equipment and infrastructure, as well as new markets for local products. For instance, “the Chinese made investments to substantially improve rural infrastructure such as roads, irrigation, drainage and flood control systems, and make the internet accessible to all in rural areas. They developed efficient transportation networks that connected farmers to markets, and introduced new policies to encourage the manufacturing and service sectors to move into rural areas, thus creating jobs and boosting people’s incomes while setting a new goal of ensuring food security for the rural poor. Also, e-commerce platforms such as Taobao made agriculture more demand-driven,” according to reports. This method if well implemented has the capacity to create decent jobs for millions of unemployed Nigerians, especially the youth.
Second, governments in Africa must renew their focus on massive investment in education through the building of new schools, equipping existing ones, and massive recruitment and training of teachers to increase the quality of education in rural areas. For instance, according to the white paper on China’s poverty alleviation issued in April 2021, China renovated 108,000 schools to strengthen the provision of nine-year compulsory education in poor areas since 2013. China did not only build new and renovated existing schools but introduced programmes such as the Special Post Program (to teach in impoverished areas upon graduation) and the National Training Program, which helped in sending additional seventeen million rural teachers to the less-developed central and western regions. “More than 8 million middle and high school graduates from poor families have received vocational training, 5.14 million poor students have received higher education, and key institutions of higher learning have admitted some 700,000 students from designated rural and poor areas,” according to reports. To the Chinese, “giving rural children a good education is an important task in poverty relief, and also a crucial means to stop poverty being passed on between generations”.
Thirdly, it is very important to increase social assistance through universal health insurance policies to ensure healthcare coverage and access for the poor and vulnerable. It is encouraging that a country like Rwanda has adopted an unconventional method to achieving universal health insurance in a country where most people work in the informal sector and are usually not medically covered as a result. More African countries need to do the same. China’s basic medical insurance coverage for the poor is now over 99.9 per cent, and all extremely poor populations now have access to medical services in their place of residence. China was able to achieve this by sending 118,000 health workers to establish 3,700 new facilities and introducing 53,000 projects to improve health infrastructure.
Lastly, it is important to have a kind of minimum living guarantee system for the extremely poor in Nigeria and the rest of Africa. China provides a rural subsistence allowance of ¥5,962 per year to the rural poor (about nineteen million people), which is an excellent social safety net.
Most importantly, eradicating corruption is of the utmost importance if African countries are to win the war against poverty. Most of the national social investment programmes of the Nigerian government in the past such as the National Home-Grown School Feeding Programme, Trader Moni, COVID-19 Conditional Cash Transfer and N-Power failed to deliver expected positive results and impact due to allegations of corruption and discrepancies in allocation of funds to beneficiaries. The Human Rights Writers Association of Nigeria (HURIWA) in 2022 described “The National Social Investment Programme, which includes the School-Feeding Programme, as, perhaps, the biggest fraud scheme in the whole of Africa,” while local civil society organizations have alleged the short-changing of Nigerians in the disbursements of cash transfers during COVID-19 due to corruption. China equally had corruption as a big issue which had to be decisively dealt with by the Chinese leadership. For instance, in 2018 alone, the Chinese top corruption watchdog (the Central Commission for Discipline Inspection) reportedly recovered 730 million yuan ($111.46 million) misappropriated from the rural poverty alleviation funds, which ensured poverty alleviation funds were properly and efficiently used for the purpose they were allocated.
Perhaps, it is time for Nigeria and the rest of Africa to take a cue from countries like China that have been in similar circumstances in terms of poverty levels.