Nigeria requires 8-10% GDP growth for sustainability – Adebajo

An economist has said that Nigeria’s Gross Domestic Products (GDP) growth target of three per cent is not sustainable for Nigeria’s population of 200 million.

Chief Executive Officer (CEO) of The CFG Advisory, Mr. Tilewa Adebajo, who disclosed this in Lagos at the bi-monthly forum of the Finance Correspondents Association of Nigeria (FICAN) said Nigeria requires 8-10 percent GDP growth for sustainability.

Speaking on the topic entitled “Nigeria’s Fiscal Environment in an Era of Monetary Policy Tightening,” he said. 

“135 million Nigerians are in the poverty trap, with 40 percent unemployment and very low job creation and industrial productivity. Dwindling reserves and increasing credit default swap premiums have resulted in Caa1 junk bond rating status for our international credit ratings.”

He believes that while the fundamentals of the Nigerian economy remain sound, poor economic leadership in the past has failed to realize potential and grow the economy. 

But, “with a new and highly rated economic management team in place, expectations are high. The success or failure of our business projections and economy will depend on their commitment and sincerity to implement and deliver on their reform policies. The goal is to drive our economy out of stagflation and attain sustainable GDP growth targets,” he emphasised.

Proffering solutions to the country’s economic challenges, the CFG Advisory boss stated that Nigeria should negotiate with creditors to restructure and extend the maturities of debt, allowing for more manageable repayments and reduced interest rates. 

Nigeria, he said, should implement fiscal discipline by reducing non-essential government spending, eliminating wasteful subsidies, and improving the efficiency of public services,” Adebajo recommended.