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New report on literacy vs industrialisation shows serious gaps in many Nigerian States

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Two revealing reports came from Renaissance Capital today on Africa.  First, Renaissance Capital through the Africa economist Yvonne Mhango released her latest Sub-Saharan economic review capturing Nigeria, Kenya, Ghana, Tanzania, Zambia, Rwanda.

Particularly notable, she upgraded her GDP forecasts for Nigeria from 2% to 3% – and strengthened the currency outlook.  Watch out for details tomorrow morning.

Actually, the top-ranked investment bank for M&A, equity and debt capital markets, as well as securities sales and trading, has been recommending investors put money into Nigeria since May; just after her annual Lagos conference and the opening of the FX window.

“We went “overweight” on Nigerian equities in November – knowing that most investors were still underweight – and that the market could do well.  It has.  We were lucky to have the oil price tail-wind”, Global Chief Economist at Renaissance Capital, Charlie Robertson.

Meanwhile, on the second release today, the Firm did an interesting cross-check on some literacy data, which they think are crucial because in their view, “it explains why the commodity crash was so much less painful than it was in the 1980s.  It shows a quite different picture for some northern states than we had before and an even better picture for some (mainly) central and southern states”.

The Firm did a map, originally from Yvonne Mhango’s excellent 37 shades of Nigeria piece, showing literacy rates vs population size in Nigeria in the attached pdf on literacy and industrialization.

The Firm pointed out that industrialization was more likely in states with a literacy rate of 70% or more, and most likely in states with a literacy rate of 80% or more.

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The Firm wrote: “It may be no coincidence then that the Ministry of Industry, Trade and Investment has chosen Abia (one of the highest literacy rates in the country) and nearby Akwa Ibom (literacy rate of 70-80%) as the first two model zones for its special industrial parks. Other brownfield zones include highly literate Lagos (over 80%), as well as Cross River and Kano (literacy rates of 70-80%).”

 

Source: RenCap 

But, the report had a few questions on some of the State level data, and even included a footnote for the one state where the data really did not seem likely “We do not mention Zamfara, as the literacy rate contrasts so significantly with the very low secondary school enrolment rate for 2007 published by the NBS”.

“We just found a way to cross check the data in yet another way.  A National Malaria survey (by the Nigerian Bureau of Statistics again, in cooperation with others) did a check on literacy rates while interviewing roughly 100-500 adult women in each state in Nigeria.  In many states, the figures for female literacy were very similar to the 2010 survey cited in the map above.

“In some states, literacy rates were higher in the 2015 malaria survey, by as much as 10-20 percentage points, vs the 2010 survey. Partly this can be explained because literacy is probably rising by 1pp a year, and partly because only 15-49 year old women were interviewed in the malaria survey, and they should have a higher literacy rate than a survey of 15-65+ year old women.  In addition, as the 2015 malaria survey sample size is smaller, some differences should be expected.

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“But we find huge differences in the data for some states. Reported literacy is far below what was reported in the 2010 survey, in the far north.  Zamfara’s adult female literacy rate was 8% in the 2015 malaria survey, vs the 76% rate cited in the 2010 literacy survey.   Sokoto’s was 9% not 67%, and Jigawa’s was 7% vs the 62.5% cited in 2010.  If the malaria survey is the more accurate, then it is not possible that Zamfara has an adult (male + female) literacy rate of 82.5% as the 2010 survey suggested.  It is far more likely to have an adult literacy rate of 40-60% like Yobe or Katsina.   Indeed, when I tweeted about this last year, a lot of replies were from people skeptical about the data in some of those states,” Robertson wrote.

Source: RenCap

The Chief Executive Officer of the National Bureau of Statistics, NBS, Yemi Kale pointed out on twitter on Monday that the two surveys are different – with different samples sizes and different original purposes.  “We cannot prove there were flaws in the 2010 literacy survey that was done before the current head of the NBS was in post.

“Why bother mentioning this? To show we are geeky about our data – RenCap knows that data is not always reliable, and we like to cross-check what we can, when we can.  Second, to re-emphasise our original point that the literacy data does suggest some states in Nigeria, and particularly those in the south, now have the human capital to industrialise.  Now Nigeria “just” needs some improvement on electricity and infrastructure…,” added Robertson.

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