A Niche Article: "Rethinking Nigeria's Governance for Economic Growth

In the context of Nigeria, a country with vast economic potential but grappling with governance challenges, restructuring the system to empower subnational governments could be a game-changer. Nigeria operates a federal republic system modeled after the United States, with a president serving as both Head of State and Commander-in-Chief of the Armed Forces.¹

*The Challenge of Centralized Governance*

Nigeria's governance structure is criticized for being overly centralized, leading to inefficiencies and bottlenecks in economic development. The current system stifles local economic participation, trapping over 200 million Nigerians in the informal sector. A shift towards genuine multilevel governance, where each tier (federal, state, local) has meaningful autonomy and responsibility, could unlock economic potential.²

*Key Areas for Governance Reform*

- *Devolution of Powers*: Empowering subnational governments through constitutional amendments to enable them to take on more economic policy responsibilities.

- *Revenue Allocation*: Adjusting revenue allocation formulae to match resources with responsibilities at each governance level.

- *Reducing Federal Overreach*: Restructuring federal ministries to focus on policy formulation and standard-setting rather than direct implementation.

*Potential Benefits of Restructuring*

- *Broad-Based Economic Participation*: Creating multiple centers of economic growth across Nigeria rather than concentrating activity in a few areas.

- *Enhanced Entrepreneurial Energy*: Empowering local governments to support local businesses and communities to organize their development initiatives.

- *Improved Governance Efficiency*: Transitioning from a system of interference and control to one of facilitation and support.

*Conclusion*

Nigeria's path to sustainable economic transformation hinges on political governance reform. By recognizing that "politics and economics are local," Nigeria can unleash tremendous energy for economic development. President Bola Tinubu's administration has taken steps like removing fuel subsidies and deregulating the foreign exchange market, but their impact is limited by the centralized governance framework.