Nigerian Economy
‘Nigeria’s Economic Crisis Due to Bad Governance’
Poor governance, themed by a vast array of issues including fiscal recklessness constitutes the major bane to Nigeria’s crisis-plagued economy, according to a new report by Nanyang Technology University’s Centre for African Studies.
The 150-page report titled “Back to Growth: Priority Agenda for the Economic Revival of Nigeria” was presented by the author and Director of the Centre, Amit Jain on Monday in Lagos.
According to the report, Nigeria is now in a state of economic crisis.
Speaking during his keynote address at the unveiling of the report, Jain stated that Nigeria’s economy was indeed in a state of crisis.
He outlined the key weaknesses contributing to the weak economy including bad governance, oil and gas dependency, high debt profile, infrastructure deficit, and lack of fiscal prudence which have led to multidimensional poverty.
Jain said, “We started working on the report in June last year when Nigeria was still gearing up for elections. At the time, it wasn’t really clear who would eventually come into power. What we did know was that whoever comes to power would inherit an economy that is in urgent need of revival, hence the title of the report which suggests a road map to put Nigeria on the path to sustainable development.
“Nigeria is in a state of economic crisis. Foreign reserves have shrunk, inflation is hurting, poverty is increasing, insecurity is spreading and business confidence is low. At first glance, the GDP figures don’t look too bad, but the GDP growth rate is barely keeping up with population growth.
“Do not go with the debt-to-GDP figures that we read in the newspapers. GDP does not pay off debt, revenue does. The most alarming figure here, therefore, is the revenue-to-GDP ratio. The global environment doesn’t look favourable either. The World Bank predicts that Nigeria will grow by 2.9 per cent in 2030 and subsequently by 2.1 per cent. That is barely above the growth of the population.”
Jain went further to outline four critical factors likely to determine Nigeria’s economic performance over the next 10 years. These include the price of oil in the international market, fiscal stability, infrastructure, and investor confidence.
Speaking during a panel session during the event, the renowned economist and Chief Executive Officer of KAINOS Edge Consulting Limited, Doyin Salami, argued that for Nigeria to experience growth, there is a need for the government to make deliberate investments in education.
He added that Nigeria’s future economic prosperity lies in its investment in the agro industry, urging the government to restructure its import if it intends to be a producing Nation.
Also speaking, the Chief Executive Officer of MainOne, Funke Opeke, explained that a lot still needs to be done by the government to create the enabling infrastructure and access to new technologies, and the right incentives to guarantee growth in the digital economy.
She added that the digital economy would only unleash its full potential provided the the government takes deliberate steps to invest in the right skills.
In his remarks, the Chairman of Union Bank, Farouk Gumel, disclosed that the challenge to Nigeria’s growth has little to do with policies or recommendations but rather with implementation.
Gumel also emphasised the need to intensive the drive for financial inclusion to caption the vast majority of Nigerians and businesses who still lack access to financial services.
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