The President of Chartered Institute of Stockbrokers (CIS), Olatunde Amolegbe has said that for Nigeria to achieve the potential inherent in its economy and improve the standard of living of the people, the country needs to push for an annual average Gross Domestic Product (GDP) growth rate of 10 per cent or more over the next 10 to 20 year period.
Speaking at the Annual workshop of the CIS with the theme Leveraging the Financial markets to achieve double digit economic growth for Nigeria, he said the economy’s annual GDP growth rate is at a low single digit levels.
He said that apart from Nigeria having massive infrastructural and educational deficit
to cover, it also contending with a significant employment deficit.
According to him, “Nigeria is obviously blessed with immense human and natural resources, unfortunately, we are also listed among the poorest countries in the world in term of per capita income. Just recently, in 2020, the country fell into its second economic recession in five years, although largely attributed to the covid-19 pandemic which affected all countries in the world and we exited the recession in the fourth quarter of the same year 2020.”
In his explanation, he said: “the critical point we have to note is that, historically, it has been observed that poorer countries need a much faster rate of GDP growth than the advanced economies of the world in to maintain standards of living as well as keep up with higher population growth rate relative to the developed economies.
“In fact, if we review the economic history of Nigeria, we will observe that this phenomenon is not new. In 1970, we recorded a GDP growth of 25.01 per cent.
The following year we recorded 14.24 per cent, while in 1974, it dropped further to 11.16 per cent. “
He stated that most of the fundamental economic infrastructure of the country was built around 1970s, noting that the last record of double-digit GDP growth in Nigeria was in 2002 when the indicator grew by 15.33 per cent.”
He said the theme for this year’s workshop has become imperative to drive the Nigerian economy as driving the economy will require financing of the right form, type, and mix.
CIS president stated that despite government’s best efforts, the local financial market cannot be said to have been utilized optimally, adding that the trend must be reviewed and reversed.
Speaking further he said, “Not long ago the Capital Market use was the fulcrum of Fund Raising by all the different tiers of government. Such fund is always utilized for infrastructure development. Full subscription to government’s revenue bond which is a form of borrowing is was widely used as the risk level is almost nil.
“Besides, governments’ participation in the market is a win-win affairs for the government, the market, and investors. The time has come for all tiers of government to stage a comeback to the financial market to enhance capital raise for infrastructure development. Our seasoned facilitators shall surely do justice to this time-tested Theme today.
“It is obvious that an accelerated development of infrastructure will bring about job creation and employment opportunities with multiplier effects on the nation’s GDP. China’s GDP grows at an average of 10 per year. This has lifted over 800 million people out of poverty in recent years.”
