…’Nigeria needs help’ – Finance Minister
Nigeria’s accelerated inflation growth has eroded the value of Nigeria’s N30 thousand minimum wage by 55 percent, and widened the poverty net with an estimated five million people in 2022, the World Bank has revealed.
This was revealed at the Corporation’s launch of the Nigeria Development Update for December 2022 Edition, and the Country Economic Memorandum held in Abuja yesterday.
Nigeria’s inflation rate, which currently stands at 21.47 percent, is the highest peak in at least 17 years and the income of citizens is failing to keep pace with inflation with civil servants and low-income households most hit by the squeeze.
In his presentation, Chief Economist, World Bank Nigeria, Alex Sienaert, said in real value, the N30, 000 is now worth N19,355 ($26), adding that over the past decade, macroeconomic stability has steadily deteriorated which has eroded growth potential and hindered poverty reduction goal.
He said Nigeria has the potential and resources to accelerate growth and reduce poverty but the current policy framework hinders prospects for economic growth and job creation as issues around multiple exchange rates, protectionist policies, trading restrictions pose barriers.
“If structural reforms are not implemented, Nigeria’s future looks bleak, per capita income will plateau, Nigerians will not have a full time job by 2030 and if the employment rate does not improve, 23 million more Nigerians will live in extreme poverty by 2030”, he said.
He reiterated the need for reforms such as the adoption of a single and market reflective exchange rate, elimination of petrol subsidy, reducing insecurity, and increasing non-oil revenues through taxes among others.
Minister of Finance, Budget and National Planning, Zainab Ahmed, said Nigeria needs help because the government at the national and sub national levels cannot provide all the financing required to meet Nigeria’s investment to drive development and growth.
The Minister, who was represented by Director-General of the Budget office, Ben Akabueze, said that Nigeria’s growth prospects have improved; however, pre-crisis challenges threaten the post-crisis recovery, with consequence for a continuous decline in GDP per capita which necessitates the need for drastic reforms.
“We need the private sector, foreign and domestic as integral partners in securing the much needed financing required to fund both physical and social investments for Nigeria’s overall development”, the minister said.
She said that the Nigerian economy has demonstrated considerable resilience in addressing the challenges, adding that through the implementation of the Strategic Revenue Growth Initiative (SRGI) Nigeria will grow its revenue and alleviate the pressure on the debt service obligations.
World Bank’s country director for Nigeria, Shubham Chaudhuri, in his remarks said overtime Nigeria has been floating along and riding on the oil price movement and is currently at a critical junction.
“Nigeria has a choice to implement critical macro-economic and structural reforms that can reduce crisis vulnerabilities and increase growth. Doing so will lift per-capita incomes, sustainably reduce poverty and deliver better life outcomes for many Nigerians”, he said.
