Our friends at the Initiative of Public Policy Analysis, based in Lagos, have an analysis of the government’s failed efforts to jumpstart the local concrete industry in Nigeria by restricting imports. Reading this, I am struck by how fuzzy the lines between failed-but-well-intentioned economic policy and state-capture can be. However, the analysis concludes:
License-or quota-based importation in whatever form effectively limits the powers of the market to operate efficiently. It creates distortions and diverts resources allocation. Resources that could be used to enhance local output are diverted into political patronage to compete for import licenses. Lifting the ban on bagged cement is at best a short-term remedy, not a long-term measure that can potentially achieve competition and lower prices. Indeed, the history of cement importation in Nigeria suggests that the latest is a familiar tune to reward political patronage…
