In a candid keynote address at the annual banking and finance conference in Abuja, the World Bank Country Director for Nigeria, Mr. Shubham Chaudhuri, underscored Nigeria’s dire need for increased public spending.
Chaudhuri made a compelling case for bolstering government expenditures, describing Nigeria’s current levels as “among the lowest globally.”
Chaudhuri’s presentation did not mince words: “Public spending by the Nigerian government, both at the federal and subnational levels, has been very low.”
He went on to emphasize that this frugality has far-reaching consequences, particularly in closing the nation’s vast infrastructure deficit. “At the current rate of capital spending, it would take 300 years to close Nigeria’s infrastructure gap,” he warned.
Comparing Nigeria to other nations, Chaudhuri lamented that public investment spending in Nigeria significantly lags behind countries like Indonesia, Ghana, Egypt, and Kenya, resulting in inadequate infrastructure quality and access.
The World Bank leader further sounded the alarm regarding Nigeria’s government revenues, which were among the lowest in the world from 2015 to 2021. He pointed out that these low revenues pose a substantial risk to fiscal and debt sustainability.
Chaudhuri did not stop there. He highlighted the abysmally low access to finance in Nigeria, which severely constrains the private sector’s capacity to invest, grow, and generate employment opportunities.
He made it clear that Nigeria’s journey to steady growth and prosperity hinged on essential measures taken by both federal and state governments, including ensuring security, political stability, and the rule of law.
The World Bank also called for investments in human capital, especially in children, unleashing private investment potential, promoting job creation, and enhancing access to finance.
The conference witnessed other notable voices echoing the urgency of financial sector reforms to boost Nigeria’s Gross Domestic Product (GDP). The Minister of Budget and Economic Planning, Abubakar Bagudu, urged the sector to increase its contribution from 3.6% to around nine percent of GDP.
He emphasized that empowering Nigeria’s youth and retaining talent within the country were vital goals.
Similarly, Folashodun Shonubi, the acting Governor of the Central Bank of Nigeria, stressed the need for the sector to elevate its economic contribution and engage in actionable advocacy.
The Chairman of the Body of Banks’ CEOs, Mr. Ebenezer Onyeagwu, called for deliberate efforts to stimulate economic growth, highlighting Nigeria’s vast market potential.
In closing, the President of the Chattered Institute of Bankers, Mr. Ken Opara, praised President Bola Tinubu’s reform initiatives, citing subsidy removal, foreign exchange regime unification, infrastructure investment, agricultural promotion, SME support, and tax reforms as key drivers that could unlock Nigeria’s economic potential if effectively implemented.
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