DRAFT. Inclusive Growth in Africa: Measurement, Causes, and Consequences

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1 DRAFT This paper is a draft submission to the Inclusive Growth in Africa: Measurement, Causes, and Consequences September 2013 Helsinki, Finland This is a draft version of a conference paper submitted for presentation at UNU-WIDER s conference, held in Helsinki on September This is not a formal publication of UNU-WIDER and may reflect work-in-progress. THIS DRAFT IS NOT TO BE CITED, QUOTED OR ATTRIBUTED WITHOUT PERMISSION FROM AUTHOR(S).

2 Topic: Impact of Social Inclusiveness on Effective Poverty Reduction Programmes in Abia State, Nigeria Abstract The incidence of poverty in Nigeria has continued to worsen despite strategic efforts and funds channeled towards its reduction, giving an indication that the numerous poverty reduction programmes have been ineffective. This study assessed the impact of social inclusiveness in poverty reduction programme in Abia state, Nigeria; anchored on community driven development (CDD) initiative, which was strikingly different from past poverty reduction programmes. Regrettably, the study discovered the non - participation of physically challenged in the programme despite the bottom up approach to poverty reduction. The poverty scenario has worsened by 30% between 2004 and 2011 in the state. JEL Classifications: I38, I32, D78, J16 Keywords: Poverty, social inclusiveness, CDD, poverty reduction. Authors: O. U. Oteh 1 ***; I. N.Nwachukwu 2 ; S. N. Robert 3 ; A. Q. Atasie 1 1. Department of Marketing and Agribusiness, Michael Okpara University of Agriculture, Umudike, Abia State, Nigeria oteh.ogbonnaya@mouau.edu.ng; ogboteh@gmail.com 2. Department of Agribusiness and Management, Michael Okpara University of Agriculture, Umudike, Abia State, Nigeria nwachukwu.ifeanyi@mouau.edu.ng; ifnwachukwu@yahoo.com 3. Department of Accounting, Michael Okpara University of Agriculture, Umudike, Abia State, Nigeria sylviaeego@gmail.com ***Corresponding author 1

3 1.0 INTRODUCTION AND BACKGROUND According to Etim and Ukoha (2010), poverty remains a substantive global problem of huge proportion. The alarming incidences at present evoke anxiety, fear, comment, argument, and have occupied a major area of discourse among policy makers and researchers. This is the thrust behind the much celebrated action plan of world leaders and policy makers in Millennium Development Goals (MGDs). The MDGs opened a new vista around the multifaceted nature of poverty and the need for integrated response. It de-emphasized the onerous issue of income but concentrated on those things that are directly associated with and which have a positive multiplier effect on poverty alleviation such as access to health care, portable water, education, road, infrastructure, etc. The idea is that, an investment in these sectors will have a larger, more substantive and immediate impact on socio-economic development of any nation. But few years to 2015 target deadline, there are strong indications that the fight is far from being halved especially for Sub-Saharan African and other developing countries where over 1.3 billion are living in extreme poverty, with less than $1.25 to survive daily (World Bank, 2009). Compared with other regions in the world, sub-saharan Africa (SSA) has the highest number of people classified as poor, followed by south Asia, which also recorded a very high headcount index as shown in Table 1. 2

4 Table 1: Poverty Gap Index by Region, (%) Regions East Asia South-East Asia South Asia North Africa Sub-Saharan Africa Source: Economic Report on Africa (2005) Over the period under consideration, the poverty level in SSA has continued to rise even in the face of many poverty reduction programmes by governments and international donor agencies. This has a far reaching implication for the socioeconomic development of the region. The recent revelation by National Bureau of Statistics (NBS) in its 2012 report that million Nigerians out of the total population of 163 million are relatively poor is not only disturbing but politically embarrassing given the vast human and natural resources the country is blessed with. This is akin to a man being thirsty in the middle of water (Oseni et al., 2012). Over the years, poverty incidences in Nigeria have exacerbated, especially in the last two decades. It jumped from 27% in 1980 to more than 70% in recent time. Perhaps, it is time; we reappraised our journey so far and maybe revisit those things that delivered our prosperity prior to the 1980s. This has become 3

5 important given the many crying faces staring on us as we pass in our environments. Table 2 showed trends of national poverty in Nigeria since Table 2: Poverty Trends in Nigeria (% of Population in Deep Poverty) Year Poverty incidence Estimated Population in (%) population poverty (million) (million) Source: National Bureau of Statistics (2012) In the bid to bridge the ever widening poverty gap, the Nigerian Government, over the years, introduced and implemented several policies and programmes (Ajibefun and Aderinola, 2004). These include locally generated initiatives and donor agencies interventions but not limited to: The National Directorate of Employment (NDE), Peoples Bank of Nigeria (PBN), Nigerian Agricultural Insurance Corporation (NAIC), National Commission for Nomadic Education (NACB), National Primary Health Care Development Agency (NPHCDA), National Agricultural Land Development Authority (NALDA), National Commission for Mass Literacy, Adult and Non-Formal Education of Nigeria, Directorate of Food, Roads 4

6 and Rural Infrastructure (DFRRI), Family Economic Advancement Programme (FEAP), River Basin Development Authorities (RBDAs), Family Support Trust Fund (FSTEF), National Poverty Eradication Programme (NAPEP). The list is inexhaustible. While some of them are still ongoing, a good number of them have gone moribund. However, close observation has revealed that these numerous policies and programmes have not translated into the desired intent and it is generally believed that the major shortcoming of these programmes is bad governance and corruption (Sule, 2012; Obadan, 2002). In reality, poverty reduction programmes are seldom publicized and usually suffer elite hijack resulting in inequality and social exclusion in the society. 2.0 BASIC CONCEPTUAL ISSUES Community Driven Development Initiative In the bid to make an impact, World Bank being a knowledge bank drew from the experience of the past and came up with a new approach paradigm shift from the failure prone top down to bottom up approach which operationalizes Community Driven Development (CDD) (Nwachukwu and Ezeh, 2007). This CDD is a new Community based participatory approach to development which involves the beneficiaries in their design and management of projects. It ensures the inclusion of all the social groupings in the society and empowers the beneficiaries to take charge of their development agenda while injecting sustainability mechanism and also leveraging their sense of ownership. Prior to the inception of CDD based projects, the effectiveness of almost all the previous poverty reduction programmes of the government became questionable 5

7 having failed to improve to a considerable extent the quality of life of the targeted beneficiaries. Resultantly, the top down approach showed visible symptoms of ineffectiveness having excluded some classes of the beneficiaries. This created opportunities for elite capture and rendered such projects inaccessible to those people to whom they were intended for (Nwachukwu et al., 2008). CDD Initiative is a development initiative that provides control of the development process resources with decision making authority directly linked to community groups. The underlying assumption of CDD projects are that communities are the best judges of how their lives and livelihoods can be improved and, if provided with adequate resources and information, they can organize themselves to provide for their immediate needs. Moreover, CDD programmes are motivated by their trust in people (Naidoo and Finn, 2001) and hence it advocates people changing their own environment as a powerful force for development. By treating poor people as assets and partners in the development process, CDD initiative to poverty reduction promises to be responsive to local demands, social and gender inclusive and therefore more costeffective compared to other development approaches. CDD s social inclusiveness strategy promises even more because of its ability to include all the social groupings designed to benefit from the programme. Social Inclusiveness Social inclusiveness in the context of poverty reduction programmes implies the identification and inclusion of all social groupings, structural constituents that 6

8 make up the society (which includes widows, elderly, orphans, physically challenged beggars, men, women, non-native rural settlers etc) from the point of project identification to the implementation stage. This principle is the central position of the principle of Community Driven Development Initiative which advocates giving the people a voice to respond to their issue. It has to do with the identification, recognition and involvement of the people that make up a society irrespective of class in the decisions and implementation of a government project. Social inclusive strategy works to address poverty, bridge access gaps in government services and remove systemic barriers found in policies, programs and services; making accessibility and availability of the poor to housing, childcare, employment, health, road and education very easy. It encourages development through participation between the members of rural communities and their local governments. This is strikingly different from what is obtainable in the past poverty reduction attempts. Overview of the CDD Projects: ABCPRP and MPP9 The European Union Micro Project Programme (EU-MPP) is an interventionist development programme aimed at the economic and social development of rural communities in the Niger Delta. The Programme aspires to achieve, among other things, the provision of basic healthcare facilities, education, rural transportation, water supply and sanitation, access roads, and increased awareness around issues or gender, HIV/AIDS, the environment, conflict and human rights, transparency and accountability in local government administration, and income generating 7

9 and other non-conventional projects as may be desired by the participating community. The European Union through the European Development Fund (EDF) and Europe Aid has so far embarked on three (3) phases of its micro-project programmes in Nigeria. The MPP3 was executed between November 2001 and 2006, covering three (3) states in the Niger Delta Region: Rivers, Bayelsa and Delta States. The programme funded 858 micro projects in those areas. The MPP6 was executed between May 2003 and April 2008, in six states of the Niger Delta Region: Abia, Akwa Ibom, Cross River, Edo, Imo and Ondo States at a cost of 40.6 million Euros for 1,921 micro projects. The programme saw 1900 micro projects (EU-MPP9 Fact Sheet) through to completion. The MPP9 was initiated in the nine Niger Delta States in April 2009, and was configured to continue until the end of 2012, with a target of 1200 micro projects (Okon, 2012). The main purpose of the MPP9 is to contribute to poverty reduction in rural and peri-urban communities in the nine (9) Niger Delta states through the promotion of participatory and gender equitable local development governance and improved socio-economic development. ABCPRP The World Bank through its various agencies adopts participatory approach initiatives in the coordination and implementation of projects aimed at improving the capacity of the rural people. In collaboration with the Federal Government of Nigeria, the World Bank through its Community-Based Poverty Reduction Initiative (CPRI) undertakes projects that are aimed at improving the production base of the rural dwellers (ABCPRP, 2000). 8

10 Abia State is one of the six benefiting states in the World Bank s Community- Based Poverty Reduction Initiative in Nigeria. Other benefiting states are Ekiti, Yobe, Cross River, Kogi and Kebbi States. The project in Abia State is customized and known as Abia State Agency for Community-Based Poverty Reduction Project (ABCPRP). The agency acts as a safety purveyor of funds directly to community designed and implemented projects. The agency took off needs assessment of about 24 pilot communities in January 2000 and the projects of the agency range from provision of electricity, water borehole, feeder roads, health centres, classroom blocks, dormitory, markets or civic halls (Onumadu and Egeonu, 2013). The need to ensure effectiveness in reducing poverty levels in the country, the World Bank harmonized her Community Driven Development (CDD) projects in the country. The harmonization process informed the merger Community- Based Poverty Reduction Project (CPRP) and Local Empowerment and Environmental Management Project (LEEMP) to form Community and Social Development Project (CSDP). The Abia CSDP was declared effective on the 1 st April, 2009 by the World Bank with the goal of improving access to services for human development. With these CDD projects implemented over time, the need to examine the impact of social inclusiveness the core of the CDD initiative on the Effective Poverty Reduction Programmes becomes imperative. Study Objectives The broad objective of this study is to assess the impact of social inclusiveness on effective poverty reduction programmes in Abia State. Specifically, the study 9

11 sought to examine the socio-economic profile of the beneficiaries; assess the degree of social inclusiveness among the beneficiaries; analyze gender differentials in participation and distribution of benefits; and estimate the impact of the project on the poverty status of the beneficiaries. 3.0 STUDY METHODOLOGY The study was conducted in Abia State. The State is located within the Southeastern Nigeria and lies between Longitude and North and Latitude and East. Abia State is bounded by Imo State at the Western border; Ebonyi and Enugu States at the North; Cross River and Akwa Ibom States at the East and Rivers State at the South. Its population stood at about 2.883,999 persons with a relatively high density at 580 persons per square kilometer (NPC, 2007). Abia State is divided into administrative blocks called Local Government Areas which is grouped into three (3) agricultural Zones namely Ohafia, Umuahia and Aba Zones. In terms of occupation, about 70% of Abians are farmers and have the potentials for the production of crops (both arable and permanent), livestock, fish and also engage in food processing (ABSG, 1992). The study employed two sources for data collection viz primary and secondary sources. Primary data were collected with the use of pre-tested and structured questionnaire administered on rural households. These include socio economic characteristics, etc. Primary data collection was between 2011/2012. Secondary data were collected from literature, local government areas, agricultural institutions and the internet. 10

12 The study applied multistage sampling technique in the selection of households from the agricultural zones of Abia State (Ohafia, Umuahia and Aba). In stratum one, 2 local government areas each were selected randomly from the zones (ie 6 LGAs). The second stratum involved random selection of 2 communities each from the 6 LGAs, set aside for the research (ie 12 communities). The last stratum entailed selection of 20 households each from the communities, giving a sample size of 240 households. For the purposes of social inclusiveness, male and female headed households were selected. Focus group discussions were used to collect community level data for complementing household - level data. The households drawn for the study were selected from communities that benefitted from both MPP9 and ABCPRP (now Abia CSDP) projects. In the analysis of data generated with the use of the questionnaire, descriptive statistics, social inclusion construct (participation in the projects) and poverty indicators (poverty line, poverty gap index and headcount ratio) were used for the realization of the objectives. 4.0 FINDINGS The socio-economic profile of the CDD project beneficiaries as shown in Table 3 indicates that they are dominated by middle aged, fairly educated, male farmers with appreciable income level for their bloated households. This is substantiated by the average age of 51 years; possession of primary school certificate by 61%; 11

13 average household size of 6; 77% male participation; 55% farmers participation and average household income of N42, (equivalent to $281) per month.` Table 3: Summary Statistics of the Socio-economic Characteristics n= 240 Age (in years) Frequency Percentage (%) > Mean 051 Education Level No formal education Primary Secondary Tertiary Household Size > Mean Sex Female Male Primary Occupation Farmers Artisans Traders Civil/public servants Income (N) 1, , , , , , , , , , Mean 42, Source: Authors Computation from Field Survey NB: $1: N150 12

14 In assessing the depth of sensitization, awareness of participants in CDD and CDD projects was compared. It could be observed from Table 4 that there was an appreciable awareness of the projects in their areas of jurisdiction given that a little higher than 60 % of the inhabitants of the project area claimed to be aware. Although there existed a measure of disparity in the magnitude of respondents level of awareness in both projects, the difference indicates deeper penetration by the CDD projects though relatively marginal. This implies that the sensitization media adopted were not adequate to deepen awareness and steer overwhelming participation. Nwachukwu and Ezeh (2007) described the situation to imply weak grassroots governmental information dissemination system. Table 4: Comparison of Awareness in Typical CDD and Non-CDD Projects Responses CDD Projects (%) Non-CDD Projects (%) Yes No Do not know 2.23 Source: Nwachukwu and Ezeh (2007); Okon (2012) 0.00 In the bid to analyze the extent of social inclusiveness in the CDD projects, an attempt was made to ascertain the participation ratio of the available social groupings that exist in the study area. At first, six social groupings were identified viz men, women, youth, elderly, widowed and the disabled. Then from Figure 1, male dominance was observed with proportional representation of about 40%, followed by women with 26% and the youth about 20%. However, the marginalized groups, the elderly and the widowed had fractional participation of approximately 10% and 4% respectively. The dominance of men in the social grouping shows that women in Nigeria still form an underclass and lack equality of opportunity like their men counterparts, both in the contributions they make 13

15 to development and the benefits they receive from it. This result is anticipated and consolidates the opinion of British Council of Nigeria Report of 2012, who opined that Nigeria s 80.2 million women and girls have significantly worse life chances than men and also their sisters in comparable societies; and typical African environment where men make decision. For instance, only 9 percent of those who stood for election in Nigeria s April, 2011 National Assembly election were female. Women are underrepresented in both social and political decision despite the 35 per cent affirmative action. It was also observed that the physically challenged were not found as participants in the CDD projects even with their existence in the project area. The machinery for sensitization and mobilization of the projects should be revitalized to achieve the optimum objective of the projects. Figure 1: Participation by Social Groupings 14

16 To address impact on poverty status of the beneficiaries, the study employed the mean income per month, poverty gap index and head count ratio to measure poverty line, poverty gap and poverty incidence respectively and to compare with poverty indices of years past. The result of the indices is presented in Table 5. The household poverty line is N42, while per capita poverty line is N7, using the national average household size of 6 persons. This is comparable to per capita household poverty line of N23,733 obtained by NBS (2005). This is an indication that the volume of expenditure required to meet minimum energy requirement and average non-food requirement has increased. The poverty gap posted a value of This can be compared with the poverty gap index of 0.12 for Southeastern geographical zone in 2004 reported by Omonona (2010). This shows that the rural households in Abia State have moved further away from the poverty line between 2004 and Poverty incidence, measured by the head count index recorded a value of This indicates that 56.7% of the households cannot afford to buy a basic basket of goods. Comparing with the poverty incidence of 26.7% for Southeast Nigeria the geopolitical zone to which Abia State belongs in 2004 as reported by Aigbokhan (2008), it could be deduced that the poverty scenario has worsened by 30% between 2004 and 2012 in the state. Table 5: Estimates of Poverty Line, Gap and Incidence Poverty Variables Estimates Poverty Line (Average Income) N42, Head Count Index (Poverty Incidence) Poverty Gap

17 Source: Authors Computation from Field Survey NB: 1$ = N150 Conclusion The persistence of poverty in Nigeria in general and particularly in Abia State has been a challenging problem. Evidences given by the poverty indicators create very scary poverty scenario and have explained the wide gap between the rich and the poor in the state. This has also brought about almost the elimination of the middle class. Having found that the poverty situation of Abians have worsened since the last national poverty survey even with the continuous implementation of CDD projects, it is important that concerted efforts are made by way of monitoring strictly agencies implementing poverty reduction programmes in the areas. This is to eliminate exclusion of some or any social grouping (s) as shown by the result. More so, the need to intensify sensitization outreach of the projects in order to enhance awareness and steer participation has also become imperative. 16

18 References Abia State Government (ABSG) (1992) Abia In Brief. Published by the Abia State Government Press, Government House, Umuahia pp ABCPRP (2000). Manual of Operation, Abia State Agency for Community Based Poverty Reduction Project, Office of the Executive Governor of Abia State, Nigeria. Aigbokhan, B.E. (2008). Growth, Inequality and Poverty in Nigeria. A CGS/MPAMS Discussion Paper No. 3, United Nations Economic Commission for Africa (UNECA), Addis Ababa, Ethiopia. Ajibefun, J.A. and Aderinola, E.A. (2004). Technical Efficiency and Policy Implications in traditional agricultural productions. Paper presented at Bi- Annual Research Workshop of AERC Nairobi, Kenya, 24th-29th May. Etim, N. A and O. O. Ukoha (2010). Analysis of Poverty profile of Rural Households: Evidence from South-South Nigeria. Journal of Agriculture and Social science, 6(1): Naidoo, K. and H. V. Finn (2001). From Impossibility to Reality. A Reflection and Position Paper on the CIVICUS Index on Civil Society Project , Washington, DC: CIVICUS Nwachukwu, I.N. and C.I. Ezeh (2007) Impact of Selected Rural Development Programmes on Poverty Alleviation in Ikwuano LGA, Abia State, Nigeria. African Journal of Food, Agriculture, Nutrition and Development 7(5): 1 17 Nwachukwu, I.N., N.M. Agwu, C.I. Ezeh, J.A. Mbanasor and C.E. Kamalu (2008). Evaluation of Second National Fadama Development Project in Nigeria: A Rapid Policy Appraisal. MPRA Paper 2008/12914, Munich University, Germany. National Bureau of Statistics (NBS)(2005). Poverty Profile for Nigeria. A Publication of National Bureau of Statistics, Abuja. 17

19 National Bureau of Statistics. (2012). Poverty Profile for Nigeria. Nigerian Bureau of Statistics. Abuja, Nigeria Obadan, M. I. (2002) Poverty reduction in Nigeria: The way forward, CBN Economic & Financial Review, 39(4): Okon, D. E. (2012). Global Partnership/Co-operation and Pragmatic Community Development: An Assessment of an EU-Micro Projects Programme (EU- MPP) in Selected Communities in Akwa Ibom State, South-South Nigeria. International Journal of Scientific Research in Education, 5(3): Omonona, B. (2010). Quantitative Analysis of Rural Poverty in Nigeria. Brief No. 17. Nigeria Strategy Support Programme, International Food Policy Research Institute, Washington, D.C. Onumadu, F.N. and E. Egeonu (2013). Impact of Abia State Agency for Community-Based Poverty Reduction Project on Farm Income and Output of Smallholder Cassava Farmers in Abia State, Nigeria, Journal of Sustainable Agriculture and the Environment, 13(1): Oseni, M., O. I. O. Oyetunji, O. Ogunlade, R. M. Sanni (2012) Groping In the Dark (Poverty): The Nigerian Experience. European Journal of Humanities and Social Science. Vol. 17(1). Pp: Sule. T (2012) Rising poverty level in Nigeria, Retrieved from on Sunday September 30,

20 Appendix Poverty Indices H = q/n Where H = Headcount ratio (Poverty incidence) q = Number of poor rural households (those below the poverty line) n = Total number of rural households Poverty gap index usually measures poverty depth and in this study, the following formula was adopted: I = [(Z Y)/Z] Where I = Poverty Gap Z = Poverty line estimated using mean household income Y = Average income of the poor rural households 19