These are problems or challenges which the economy is experiencing that tends to draw back the growth and development of the country.

1. ECONOMIC DEVELOPMENT
CHALLENGES

2. Meaning Of Economic Development
Challenges.
• It refer to some problems or challenges which
the economy is experiencing that tends to
draw back the growth and development of the
country.
• Examples of such economic development
challenges are poverty, debt burden and debt
relief, HIV/AID eradication, power and energy
supply, resource control and corruption.

6. Poverty
• Poverty means a lack of material possessions
belonging to a person.
• Poverty often equates to a lack of some of the
most basic and important material goods such
as shelter, clothing, gender equality, health
facilities, education, jobs and increases in
diseases and sickness.
• Poverty has been determined by World bank
as having an income of less than $2 per day.

13. Types of Poverty
1. Absolute poverty: it occurs when people do
not have access to basic food, clothing and
shelter.
2. Relative poverty: it is when poverty of a
country is related to other people in the
country.
People who are relatively poor are unable to
participate fully in the normal activities of the
society they live in.

15. Just as a country can be trapped in a vicious
circle of poverty, so can be individuals. People
who are poor are likely to have worse than
average education and health care. This will
reduce their productivity, employment
opportunities and income and will also affect
the prospects of their children.

17. Effects Of Poverty
• Poverty can lead a person to experience the following
properties of poverty. Some of the properties of
poverty include.
1. Hunger
2. Malnutrition
3. HIV/AIDS
4. Malaria
5. Lack of sanitation and water
6. Gender inequality
7. Low education
8. Low life expectancy
9. Large family size
10.Unemployment

22. Possible Government Policy Measures
to Reduce Poverty.
• There are a number of measures, a government
may take in a bid to reduce poverty. Its choice of
measures, however, can be restricted by the
potential funds raised by it. Among the possible
measures, we have:
1. Improving the quantity and quality of education:
In the long term this can be a very effective policy, as
it can increase the job prospects and earning
potential of the poor and their children

24. 2. Increasing aggregate demand: to increase
employment by, for instance, increasing
government expenditure or reducing the rate of
interest. Unemployment is a major cause of
poverty. Having unemployed and under-
employed workers not only lowers their
standards, but also the living standards of others
since output will be below potential.

26. 3. Introducing or raising a national minimum wage:
This is designed to tackle the problem of people
experiencing low living standard due to low wages.
4. Encouraging more MNCs to set up in the country:
The opening up of new firms in the country should
create more employment opportunities.
5.Land Reform: In a number of countries, many
agricultural workers work on land owned by a few rich
land owners. Those who rent or lease land may be
reluctant to improve the fertility of the land. In such
circumstances, making ownership of land more equal
may increase output and living standards.

28. 6. Providing benefits or more generous state benefits:
The elderly and some of the sick and disabled may not
be able to work and may not have any savings to
support them. Giving them benefits, or raising the
benefits they receive, may enable them to avoid
absolute poverty. What is more debatable is the effect
that raising unemployment benefit will have on
poverty. If there is alack of jobs, it may help in the short
term as it will not only raise the living standards of the
unemployed but may also reduce unemployment by
increasing aggregate demand. If, however, job are
available and the unemployed are not filling them
because they receive a higher income on benefits,
raising benefits will reduce the incentive to work.

29. Assignment
1. Discuss the methods of poverty alleviation
and eradication in Nigeria.

30. Agencies For Poverty Alleviation
• In a bid to overcome poverty in Nigeria, government
has initiated different policies and structural
programmes between 1977 till date. These
programmes include:
1. Directorate of Food, Roads and Rural infrastructure
(DFFRI).
2. Better Life Programme (BLP)
3. National Directorate of employment (NDE)
4. People’ Bank of Nigeria (PBN)
5. Family Support Programme (FSP)
6. Poverty Eradication Programme (PEP)
7. National Poverty Eradication Programme (NAPEP)
8. National Economic Empowerment Development
Strategy(NEEDS).

31. National Poverty Eradication
Programme (NAPEP)
• NAPEP is a 2001 program by the Nigerian
government aimed at poverty reduction, in
particular, reduction of absolute poverty. It
was designed to replace the Poverty
Alleviation Program.
• NAPEP goals include training youths in
vocational trades, to support internship, to
support micro-credit, create employment in
the automobile industry.

32. • The program is seen as an improvement over
the previous Nigerian government poverty-
reduction programmes. According to a 2008
analysis, the program has been able to train
130,000 youths and engaged 216,000 persons,
but most of the beneficiaries were non-poor.

41. SOME ECONOMIC DEVELOPMENT
CHALLENGES IN NIGERIA.
1. Debt burden and debt relief: Debt burden refers
to the massive accumulation of huge debts by
the country. Local government, state and federal
executive borrow money and refuse, to pay
back. This practice will never allow the economy
to grow.
Debt burden can only be removed by
developed countries through what is referred to as
debt relief.

42. 2. HIV/AIDS and the Economy: it have become a
major treat to economy. This disease have cause a
lot of problem to the economy. That the disease is
not curable is more worrisome. The disease is more
common with the youths who should form the
greater percentage of the working population.
Under this situation the economy will suffer as it
will lead to low productivity and slow down the
growth and development of the nation.

43. 3. Corruption: it is the usage of acquired power in a
dishonest or illegal way to acquire wealth which
belong to the public. This practice do generally lead
to poor economic development of the country.
4. Power and Energy supply: the power and energy
supply with particular reference to electricity is a
big problem to the economic growth of a nation.
Power supply to the economy for productivity is
grossly inadequate to ensure rapid economic
development.

44. Assignment
1. List and discuss four economic development
challenges in Nigeria.

45. Test
1. Trace the origin of the IMF or the World Bank
and examine the relevance of either of them to
the development of your country. (10 marks)
2. Carefully distinguish between economic growth
and economic development. Show the
relationship between them, if any. (10 marks)
3. What is poverty? List ten effects of poverty on
an individual. (10 marks)