Japa: Its Costs and Benefits

Photo by Anete Lūsiņa on Unsplash

By

Chimere Iheonu

Date Published

December 6, 2022

Category

Political Economy

Earlier this year, my friend M called me to find out when I would love to Japa and to tell me how he was preparing to leave Nigeria. Today, M is in France for graduate studies. Not necessarily because he wants to earn a graduate certificate, but because he wants to leave the country. Next month, Aunty U and her family will move to the United Kingdom (UK) under a healthcare visa. My friend M and Aunty U are not the only ones that have moved or will be moving out of Nigeria in recent times. However, they are the latest on my friends' list that have emigrated or are about to emigrate.

The majority of Nigerians who emigrate to the global north do so through education. In 2021, Nigerian students and their dependents contributed £1.9 billion to the UK economy. In January and February 2022, Nigerians spent more than $130 million on foreign education. These stats are mind-boggling and have significantly contributed to capital flight. If efficiently invested in the Nigerian education system, these funds will significantly prop up education, both in quality and quantity.

However, the trend in the number of Nigerians moving out of Nigeria keeps rising. The need for greater quality of life and better wellbeing are the primary factors driving this trend. Individuals are rational, making decisions that maximize personal benefit and are based on self-interest. For most Nigerians, the country can no longer guarantee the future they feel they deserve, and migration seems to be the only other option.

The Cost of Rapid Emigration Out of Nigeria

As Nigerians move to the global north, its effect is felt across every sector of the Nigerian economy. Many universities in the country are running out of quality faculty members. The negative influence of this on human capital formation is enormous. A good proportion of graduates from Nigerian universities are not competitive, thus affecting labor productivity and economic output. In the health sector, there has been a substantial decline in the number of medical personnel as they seek better opportunities abroad. A 2018 poll from NOI reveals that 88% of doctors seek employment abroad. The Nigerian Medical Association has also revealed that 50 doctors leave Nigeria every week. 

Health statistics in Nigeria are dim. In comparison to the World Health Organization's (WHO) recommendation of one doctor to 600 patients, the doctor-patient ratio is one doctor to 10,000 patients. This ultimately undermines the ability to achieve the Sustainable Development Goals (SDG) 3 and 4, which correspond to improving education and health outcomes, by the target date of 2030.

In general, there has been a significant loss in skilled labor, which is felt in the tech industry as well. This self-selection of migrants reduces human capital in Nigeria—a key driver for economic development.

Are there Benefits?

The most valuable benefit of emigration is remittance inflow. In this context, remittances are the transfer of money from an individual who resides in one country to another individual who resides in another country. In 2020, Nigerians accounted for 40 percent of the diaspora's remittances in Sub-Saharan Africa. In 2021, the remittance inflow into Nigeria was $19.1 billion—the highest in Sub-Saharan Africa. 

In fact, data from the World Bank, as revealed in Figure 1, shows that remittances received since 2004 contributed more to Nigeria’s Gross Domestic Product (GDP) when compared to FDI. This stat reveals the importance of remittances to the Nigerian economy. Extant empirical literature has also revealed the critical importance of remittances for economic growth, household consumption, employment, poverty alleviation, and a general improvement in quality of life. These substantial advantages serve as a reminder that, despite emigration greatly costing Nigeria, there are still advantages to it.

Figure 1: FDI and Remittance (% of GDP)

Source: World Bank (2022)

Conclusion

There won't be a quick waning of the Japa fever. This trend is buoyed by the rising cost of living in Nigeria, increased insecurity, and generally dismal economic outcomes. While the costs of emigration can lead to subpar educational and health outcomes, which eventually have a detrimental impact on economic development and well-being in both the short and long run, the benefit is clear when considering that migrants send money home, which can support economic activity and enhance economic outcomes. In light of this conundrum, it is unclear whether the supposed gain is substantial enough to outweigh the losses. However, the rate at which Nigerians are leaving the country would have a significant short-run effect, which could lead to the inability of the country to achieve the SDG goals as outlined by the UN. 

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Disclaimer: This information in this article is NOT investment advice. It is intended for information and entertainment purposes only.

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