The Nigerian Economic Summit Group has predicted a growth rate of 2.9 per cent for the Nigerian economy in 2021, higher than the 1.5 per cent growth rate suggested by the International Monetary Fund.
The NESG identified eight key policies and events that will help shape the outlook of Nigerian economy in 2021.
This is contained in the group’s 2021 Macroeconomic Outlook Report titled, “Four Priorities for the Nigerian Economy in 2021 and Beyond,” launched virtually on Tuesday.
According to the report, for Nigeria’s economy to get back on track, the economy needs a high, robust and sustained economic growth that will deliver a significant reduction in unemployment and poverty.
The report said the government’s most important agenda in 2021 must be to address these problems as a foundation for economic recovery in the short term and inclusive economic growth in the future.
The 77-page report stated that in consonance with the expected recovery of the global economy in 2021, Nigeria is also projected to exit the recession this year, and that the country’s “business-as-usual” scenario agrees with this projection.
However, the report said Nigeria needs more than a simple GDP rebound, especially taking into consideration the last recovery cycle.
“Recession”
In November last year, the Nigerian economy slipped into its second recession in five years as the country’s gross domestic product contracted for the second consecutive quarter.
The Minister of Finance, Budget and National Development, Zainab Ahmed, said the Nigerian government was working towards reversing the declining trend.
‘The policies and events ‘
The NESG report noted that the key policies and events that will determine the nation’s economy this year will include mass production and administration of COVID-19 vaccines globally, implementation of Africa Continental Free Trade Area (AfCFTA), introduction of special bills by the Central Bank of Nigeria in order to manage excess liquidity in the system, and OPEC+ agrees to boost oil output.
Others are: COVID-19 partial lockdown and social distancing; completion of the Lagos-Ibadan Railway Project; Early implementation of the 2021 Appropriation Bill and the Reopening of land borders.
“The new strain of the virus could however slow recovery in 2021” the report said.
Prospects
In a case scenario presented in the report, the NESG predicted that the Nigerian economy would grow by 2.9 per cent in 2021, and that it would achieve a sustained high growth rate up to 2025. The International Monetary Fund predicts a growth rate of 1.5 per cent for Nigeria in 2021.
It said projected revenue to increase by 23.3 per cent in 2021 and said exchange rate will become stable and key inclusive growth indicators such as unemployment and poverty rates will gradually reduce overtime.
In his remarks, NESG CEO, Laoye Jaiyeola, said in 2021, many of the challenges encountered in 2020 will remain, or perhaps become amplified.
“So will the expectations of citizens and the business community on the government to address these challenges,” he said.
Mr Jaiyeola said a lot more efforts are needed to get Nigeria on the path of positive economic growth that will deliver a reduction in unemployment and poverty.
Mr Jaiyeola said the four priorities areas must be macroeconomic stability, policy and regulatory consistency, sectoral reforms and human capital development.
“The overall goal must be to attain a favourable business environment and improve the welfare of the average Nigerian,” he said.
