As Nigeria plans its energy transition from fossil fuels, Civil Society Organisations (CSOs) in the country have urged the Akwa Ibom State government, an oil-producing state in Nigeria, to take proactive steps to diversify its economy by investing more in agriculture and tourism.
The CSOs, which include BudgIT, Natural Resource Governance Institute (NRGI), and Policy Alert, made the call over the weekend during a policy dialogue on strengthening fiscal resilience in Akwa Ibom State, organized by BudgIT.
Tengi George-Ikoli, a senior officer at NRGI, in her presentation, said that not just Akwa Ibom, but all other oil-producing states should prepare their budgets such that their revenue comes from multiple sources and is not heavily dependent on federal allocations, as this would mitigate the effects of the energy transition on them.
She said, from available reports, Akwa Ibom has 86% dependence on FAAC and wondered how the remaining 14% from internally generated revenue would be enough to run the recurrent expenditure, like payment of salaries, among others, if the money from oil depletes.
Ikoli urged the Akwa Ibom government to explore the potentials in tourism and agriculture sectors, noting that the state has the longest shoreline in Africa and that tourist destinations should be packaged and promoted in a way that would attract global tourists.
She said a technological system of revenue collection should be adopted to avoid leakages in the process, adding that the Akwa Ibom State Internal Revenue Service (AKIRS) should be granted autonomy in order to combat corruption and inefficiencies within the state’s investment companies.
Her words: “Akwa Ibom should diversify its economy, shifting its focus from oil and gas to other sectors such as agriculture and tourism. The state’s tourist destinations should be better packaged and promoted to attract global tourists.”
Also speaking, Enebi Opaluwa, Research and Policy Analyst at BudgIT, expressed hope that the Akwa Ibom State government would take up all the concerns raised at the policy dialogue in order to build the fiscal resilience of the state.
He said that since the Akwa Ibom State government is currently adjusting its budget and fiscal structure, they should infuse the element of diversification into their plan.
Opaluwa observed that some projects in Akwa Ibom are not “sweating,” in that the revenue they generate is less than the cost of their maintenance, citing Godswill Akpabio International Stadium as an example, even as he urged the state government to put such facilities out for more income-generating services.
“Akwa Ibom should check the popular renewable energy sector that will help in diversifying its fossil fuel dependence. The state has the longest coastline, and there are things it can leverage on to achieve this objective, such as the hotel industry, Akwa culture, tourism, among others. These are potential sources of business that can be explored,” Opaluwa added.
Energy transition: CSOs task Akwa Ibom govt on diversification of economy
