A bill proposing the creation of Etiti State in Nigeria’s South-East geo-political zone was read for the first time during a plenary session in the House of Representatives on Tuesday.

Sponsored by five members of the House—Amobi Ogah, Miriam Onuoha, Kama Nkemkama, Chinwe Nnabuife, and Anayo Onwuegbu—the bill seeks to carve out the new state from the existing Abia, Anambra, Ebonyi, Enugu, and Imo states.

The proposed Etiti State would encompass 11 local government areas (LGAs) drawn from the five states, with its capital to be located at Lokpanta. The bill aims to amend three sections of the 1999 Constitution, altering the number of states from 36 to 37, and adding “Etiti” to the list of states following Enugu. Additionally, it seeks to reassign the relevant LGAs from their current states to the new state.

The LGAs affected include:

1. Abia: Isuikwuato and Umu-Nneochi
2. Anambra: Orumba North and Orumba South
3. Ebonyi: Ivo and Ohaozara
4. Enugu: Aninri, Awgu, and Oji River
5. Imo: Okigwe and Onuimo

The Struggle for Six South-East States

For years, the Southeast has been advocating for the creation of an additional state, arguing that the region’s status as the only zone with five states among Nigeria’s six geopolitical zones has led to significant federal allocation disparities. This imbalance has cost the region trillions of naira and spurred renewed calls for equitable state distribution.

The last state creation in Nigeria occurred in 1996 under the regime of the late General Sani Abacha. Since then, the Southeast has consistently demanded another state.

Ohanaeze Ndigbo Worldwide, the apex Igbo socio-cultural organization, has been a vocal proponent of this cause. It said the creation of a new state in the southeast will not only correct the imbalance in state allocation that has historically relegated the zone to a lesser status but also pave a new path for Ndigbo in the Nigerian polity.

Chief Emmanuel Iwuanyanwu, President-General of Ohanaeze Ndigbo, reiterated this demand at a retreat in Enugu in April, expressing dissatisfaction with the 1999 Constitution and threatening legal action if the federal government fails to create an additional state.

Legislative and Constitutional Hurdles

The challenge of creating a new state in the region, among other things, has been largely attributed to the rigidity of the 1999 constitution.

Creating a new state in Nigeria involves a rigorous constitutional process. Section 8(i) of the 1999 Constitution stipulates that a request for state creation must be supported by at least a two-thirds majority of representatives from the Senate, the House of Representatives, the House of Assembly, and local government councils from the area demanding the new state.

Furthermore, the proposal must be approved in a referendum by a two-thirds majority of the area’s populace, followed by a simple majority approval from all states of the federation and a two-thirds majority approval in both houses of the National Assembly.

In recognition of the challenges associated with state creation, delegates at the 2014 National Conference recommended amending the constitution to simplify the process. They specifically endorsed the creation of an additional state in the Southeast to promote reconciliation, equity, and justice. The conference suggested that state creation should ensure parity between geopolitical zones and be based on the economic viability of the proposed state, considering its natural and human resources, land, and water mass.

The introduction of the Etiti State bill follows the recent passage of the South-East Development Commission Bill through its third reading in the House of Representatives. The National Assembly’s ongoing efforts to amend the 1999 Constitution aim to address long-standing issues, including the perceived marginalization of the Southeast region.

While the journey towards creating Etiti State is fraught with legislative and constitutional challenges, the bill’s progression to its first reading marks a significant milestone. This development has rekindled hope that the Southeast’s persistent call for a new state may finally be answered, potentially rectifying historical imbalances and fostering greater regional equity.

Alhaji Aliko Dangote, one of Africa’s most prominent businessmen, addressed Nigeria’s rising interest rates, making comparisons with other countries, especially in North America, Europe, and Africa, facing similar of different economic challenges.

The Chairman of the Dangote Group, noted that economic growth in Nigeria will remain elusive unless the current bank interest rate of 30% is reduced. He made this assertion during his keynote address at the 2024 summit of the Manufacturers Association of Nigeria (MAN) held in Abuja.

Dangote pointed out that the inflation-driving interest rate hikes in major advanced economies such as Europe and the United States differs significantly from the inflation experienced by developing countries, particularly in Africa. He highlighted that the unique economic challenges faced by these nations require a different approach to interest rate policies to foster growth and development.

He attributed the inflation in North America and Europe to the massive cash transfer programs implemented by governments during the COVID-19 pandemic in 2022. According to Dangote, around $18 trillion was disbursed to individuals and businesses during this period, leading to an oversupply of money chasing a limited supply of goods.

“Mr. Vice President, I know that today we are battling with very high interest rates. This interest rate is now saying that we should fight inflation. I’m not an economist, I’m just a local businessman,” said Dangote.

He elaborated, “The other countries, why did they jack up interest rates during COVID-19? The G7 countries pumped money into their economies to the tune of 18.9 trillion. So in their economies, there was so much of money chasing few goods. This means that everything is going to go up.”

Dangote pointed out that unlike North America and Europe, African economies did not implement such significant cash transfer programs during the pandemic.

“During COVID, we didn’t do anything at all. The only thing we did was food palliative and I’m talking about Africa in general,” he noted.

As a result, African countries did not experience the same inflationary pressures stemming from excess liquidity, but they are now facing other economic challenges, he explained.

Speaking about Nigeria’s current high interest rate, Dangote stated that it is responsible for economic stagnation.

“Right now, at 30%, there is no way anybody can create jobs because we are actually stifling growth. So interest rate can remain at 30% but no growth will happen unless that interest rate comes down,” he asserted.

The Central Bank of Nigeria (CBN) has hiked interest rates by a combined 750 basis points over three consecutive Monetary Policy Committee (MPC) meetings, raising rates from 18.75% to 26.25%.

World Bank’s Warning on Monetary Policy Measures

Supporting Dangote’s assertion, the World Bank warned the CBN in early June that recent monetary policy measures, including raising interest rates, may not effectively curb inflation as anticipated by analysts. In its latest report, “Global Economic Prospects,” which outlines the economic outlook for 2024 and 2025, the World Bank highlights the risks of the policies, particularly the potential ineffectiveness of the CBN’s monetary tightening measures in controlling inflation.

Despite an aggressive increase in interest rates by a combined 750 basis points since the beginning of the year, inflation remains a persistent issue. Central bank Governor Yemi Cardoso, in his first Monetary Policy Committee (MPC) meeting, raised the interest rate by 600 basis points from 18.75% to 22.75%. Subsequent hikes have pushed the rate further to 26.25%. The bank also increased the Cash Reserve Ratio (CRR) of banks to 45%, one of the highest rates globally.

These measures were aimed at taming inflation, but the results have been underwhelming. Inflation rose from 29.90% in January 2023 to 33.95% in May 2024, defying expectations that higher interest rates would slow it down.

Various stakeholders, including members of the Nigerian business community such as the Centre for the Promotion of Private Enterprise (CPPE), the Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA), and the Manufacturers Association of Nigeria (MAN), have criticized the CBN’s approach. They argue that the high interest rates are ineffective in combating inflation and instead harm the real economy by raising the cost of accessing capital.

Economists have also pointed out the contradictions in the CBN’s strategy. While the bank is increasing the MPR to combat inflation, other policies appear to counteract these efforts. This highlights the complexity and potential ineffectiveness of relying solely on monetary policy to address inflation in Nigeria’s unique economic context.

The Need to Protect Local Industries

Furthermore, Dangote called for greater protection of local industries, especially in manufacturing, which has been in decline since the 1970s. He emphasized that attracting foreign direct investment is heavily dependent on strong local investment. He cited examples from around the world, where countries that publicly support free trade often enact policies to protect and promote their local industries, turning them into national treasures.

“The only way to attract foreign direct investment is local investment,” he stated, pointing to the success stories of the West, China, and India.