Africanews

The Nigerian Economic Outlook and Imperative for Inclusive Growth and Development

Since the return to democracy in 1999, Nigeria has achieved remarkable economic growth and the opening up of some sectors in the economy.
Despite the expansion of the economy to become the largest economy in Africa in 2014, Nigeria’s growth experience in the 2000s was accompanied by rising unemployment and poverty rates, thus, making the concept of inclusiveness imperative to achieve widespread development.
The economic recession in 2016 and the process of recovery in 2017, both of which were triggered by developments in the oil sector, further raises concerns about the pattern and quality of economic growth.
Undoubtedly, the Nigerian economy will grow in 2018. However, beyond the growth narrative, the big questions for policymakers are clear: • How inclusive will Nigeria’s growth be? • What measures are required to achieve inclusive growth? • How do we measure progress towards social and economic inclusion?
Mr. Kyari Bukar, the Chairman, Nigerian Economic Summit Group (NESG), says concern for the economy should go beyond mere growth narrative to ensuring resources are efficiently utilised.
Bukar made the observation in Lagos during Nigeria-South Africa Chamber of Commerce (NSACC) February Breakfast Meeting in Lagos on Thursday.
He was delivering a paper on “The Nigerian Economic Outlook and Imperative for Inclusive Growth and Development”.
Bukar said that the nation’s growth model needed a rethink and placing priority on inclusiveness should be a pre-eminent consideration.
He said that if resources were efficiently utilised and benefits of growth equitably distributed, resilience would be built against downside risks economically.
“Making growth inclusive is not a negotiable priority for the government. The average citizen must contribute to and benefit from the growth process.”
Bukar said that the key socio-economic indicators had not fared well in spite of the recovery of the economy from recession in 2017.
“The latest report of the National Bureau of Statistics (NBS) showed that unemployment and underemployment rate rose from 35.2 per cent in 2016 quarter 4 to 40 per cent as at 2017 quarter 3.
Despite the recovery from recession with a growth rate of about 1.40%, Nigeria needs to attain the level of inclusive growth which creates job opportunities and uplifts millions of poverty.
This is crucial for policy makers as the current high unemployment rate of 18.8 percent, brings a fundamental challenge to the Nigerian socio-economic space.
The Chairman of the Nigeria Economic Summit Group (NESG) Mr Kyari Bukar asserted that beyond the growth narrative, the key issues that had to be addressed in the country was the inclusivity of the growth.
Mr Bukar shared that three questions for Nigeria on inclusive growth were How Inclusive, What measures were required for inclusive growth and How Social Inclusion could be achieved.
From his analysis of the economic performance, the NESG Chairman stressed that Oil and Agriculture played the role of economic drivers, while other sectors have remained slow in economic activities.
Mr Bukar shared that three questions for Nigeria on inclusive growth were How Inclusive, What measures were required for inclusive growth and How Social Inclusion could be achieved.
From his analysis of the economic performance, the NESG Chairman stressed that Oil and Agriculture played the role of economic drivers, while other sectors have remained slow in economic activities.
Looking at the 2018 outlook Mr Bukar called for macro-economic and price stability in the country.
He also made a strong case for the implementation of growth enhancing policies, for sectors like Agriculture and Manufacturing.
On the monetary policy side, he opined that favourable interest rates will be key for the economy as it seeks inclusivity in all spheres.
He harped on need for the implementation of the Ease of Doing Business reforms across the 36 States of the Federation, which should leverage on the successes at the Federal level.
To boost Industrialization in the country, he called for the review and implementation of the National Industrial Revolution Plan.
Considering the challenge of human capital development in the country, Kyari Bukar believed a “National Skills Policy” should be in place to develop talents and build a dynamic workforce that can compete with other nations.
“Likewise, over 85 million Nigerians lived below the national poverty line, even as Nigeria remains in the category of countries with low Human Development Indicators (HDI), according to the World Bank’s HDI Report.
“This points to one fundamental fact that Nigeria’s economic growth needs to be inclusive to provide employment opportunities and lift millions out of poverty,” he said.
According to him, policymakers should pay attention to pillars of inclusive growth which are achieving growth that is broad-based and led by the productive sectors such as manufacturing, construction and agro-processing.
“Pursuing Social Inclusion with reforms in Education, Health and Skills Development, and providing Social Safety Nets for the poor and vulnerable citizens’’.
Bukar said that to make the pillars effective, they must be backed and supported by good governance and strong institutions.
According to him, to achieve growth that is broad-based and led by the productive sectors, the following policy recommendations are crucial.
“There is need to ensure macroeconomic stability and this can be achieved by maintaining exchange rate stability and sustaining existing policies that ensure foreign exchange availability.
“Ensure price stability by intervening urgently to prevent fuel scarcity, provide interventions in the agricultural sector to increase food supply and ensure availability of foreign exchange.
“Implement growth-enhancing policies (including intervention funds) for sectors such as agriculture, manufacturing, construction and transportation.
“Maintain favourable interest rate which will spur economic growth, implement ease of doing business reforms across states and implement reforms to reduce regulatory bottlenecks across sectors’’.
Bukar stressed the need to review and implement the Nigerian Industrial Revolution Plan (NIRP) toward providing a clear strategy to develop sectors like manufacturing, agro-processing, metals and solid minerals, oil and gas as well as services.
“We believe that if the NIRP is appropriately implemented, Nigeria will achieve a well-diversified economy, with the productive sectors contributing significantly to GDP growth and unemployment reduction.
“A well-diversified government revenue base, export and foreign exchange earnings as a result of expansion in manufacturing and agricultural sectors,” he said.
The NESG boss said there was need to increase the capital budget performance to stimulate the construction sector and enhance provision of infrastructure toward creating an enabling environment.
“Focus on targeted infrastructure projects that can spur the growth of the industrial sector and Implement the debt re-balancing strategy to reduce interest payments on government debt and free-up funds for capital projects.’’
Bukar urged government to embark on procurement reforms to reduce delays and inefficiencies in the budget process and strengthen monitoring and evaluation capacity within the government.

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