Alumni associations as catalysts of economic resurgence

By Joseph Edgar…

The economy is said to be on the path to recovery, with indices showing some sign of positive turnaround. Recently, like most watchers, I have been an avid follower of the Nigerian bureau of statistics report which measures economic performance, especially the rate of unemployment, inflation and the consumer price index. The story has been, until very recently, quite dire with the economy loosing over 2m jobs at the very height of the recession and inflation hitting double digits up from a stable single digit run during the last administration.

The Naira exchange rate has also not been very cheery, going almost bizarre, tipping an unprecedented high above the N500 mark before stabilizing at a little bit above N300. All of this, compounded by not only a falling oil price, but a shift in global energy demand seeing the threat of shale oil, solar powered initiatives and shifting trade partnerships seeing Nigerian lose the vital US markets and competing in the Asian markets with competitors parading better advantages, including proximity.

As usual the government attacked the tail spinning economy with traditional instruments, revving up international borrowings to spend its way out of the recession, thereby stifling future growth potentials with pushed out interest repayments. The believe amongst experts is that if enough was spent on infrastructure for example, the economy would be reflated and we would be out of the recession, forgetting some very fundamental points. As long as we remain heavily dependent on the mono product and continue with the elitist consumerist lifestyle, the pressure on the dollar will continue, thereby, making a mess of whatever policy the government would be throwing at the situation.

However, upon deep reflection, one would like to just maybe look at an unorthodox approach towards a problem that has seemed to defy all traditional methods. With the kind of deep markets and huge demographics we parade, we can internally generate wealth that would then be thrown at amongst others the Exchange rate and infrastructure to mention a few.

In trying to diversify the economy, I have always pushed towards the entertainment industry which is growing phenomenally from almost zero barely 20 years ago, to record a whopping N3trillion, employing millions both directly and indirectly and also positively impacting other industries like marketing, services and now equipment leasing.

Read also: Presidential broadcast and other stories

Furthermore, I would like to push in a bid to move from the micro level towards the macro at cluster associations coming together to pull retail resources into a powerhouse of growth, creating employment, investible funds and generally providing an alternative path towards self-reliance as a nation.

In looking at these, Alumni Associations have come to mind. They are welded together by a collective nostalgia of past educational pursuits, bringing together a vast collection of individuals who have in their pursuit for a living built careers spread all over the different sectors of the economy and even the diaspora. These associations if better positioned could serve as a catalyst for our economic resurgence as a nation, albeit a non-traditional economic powerhouse.

In pushing for this position, the examples of the Harvard and Stanford Alumnae come to mind. These two associations manage funds running into billions of dollars with investments far afield as Wall Street and the real economy. Stanford for example contributes significantly to scholarships, research and infrastructural development of the school.

Nearer home, the example of the University of Ibadan comes readily to mind. The fund set up and run by the Alumni remains quite aggressive and robust, impacting on the school especially in the area of infrastructure. The figures are staggering and private. It keeps growing as a result of the efficient collections structure put in place and effective non personal management guided by a well thought out disbursement matrix have made the fund a veritable support for the continued development of the school.

I think the time is ripe for these community-based type associations to not only focus on their ‘’birth communities’’ but to begin to redirect its activities towards the general economy generating funds, effectively managing them and pushing the funds towards the creation of jobs, impacting on infrastructure and generally contributing to the economy like the afore-mentioned international examples.

Lets take a simple example. I attended Command secondary school with a potential alumni membership of 10,000. We are on the verge of building a robust pull of funds relying heavily on this deep cluster. The school has industrious alumni spread all over the economy and obviously within the commanding height of the military and police. A fund that pools in a minimum monthly N1,000 per member would in one year grow to N120m with just the base principal, and without counting interest on it. Effective management and professional servicing of the fund could see it hit the N500m mark in less than five years. These funds managed under a powerful Trust deed could see it being invested in several sectors of the economy while also creating jobs for its members who have not been able to find jobs, impacting on the school and much more importantly providing fluid funds for the economy.

Now we have four first generation Command Schools with a possible potential membership of 40,000. What this means is that if we are able to build a concise general Fund we could be looking at an estimated fund size in excess of N2b within the first four years in absolute figures. This is assuming we have a 100% buy in. Like we all know it would be virtuallyimpossible to achieve total buy in but even the averages are humongous, especially if we look at older schools, pulling in the universities and colleges of education and other such groupings we could be sitting on a keg of tremendous wealth which would not only assist in the reflation of the economy but also strengthen the governments hands in its resolve to achieve a ‘’turn around’’ of the economy through internally generated funding.

Lets look at the pension industry which today has effectively built a fund size in excess of a trillion naira. Today we are thinking of pushing the funds into viable areas. These alumni approach if effectively championed could rival the pension industry in less than five years because of its share membership size which out numbers the possible market size of the pension membership pull thereby providing the government an opportunity of n a vehicle to reform the economy.

In conclusion, we must as a matter of urgency seek to retool and refocus our alumni associations, gradually pulling them away from the present reunion and nostalgia-fuelled social tug boats to engines of economic power positioning them as willing partners as we push to rebuild our economy bottom up.

 

RipplesNigeria… without borders, without fears

Click here to join the Ripples Nigeria WhatsApp group for latest updates.

Join the conversation

Opinions

Support Ripples Nigeria, hold up solutions journalism

Balanced, fearless journalism driven by data comes at huge financial costs.

As a media platform, we hold leadership accountable and will not trade the right to press freedom and free speech for a piece of cake.

If you like what we do, and are ready to uphold solutions journalism, kindly donate to the Ripples Nigeria cause.

Your support would help to ensure that citizens and institutions continue to have free access to credible and reliable information for societal development.

Donate Now