An increase in Foreign Direct Investment inflow, a diversified export profile, and a business-friendly environment has been identified as being crucial for economic rebound post-COVID-19 in Nigeria.
This was discussed during the half-year economic and business outlook seminar for 2021 hosted by the Lagos Chamber of Commerce and Industry (LCCI) in collaboration with PricewaterhouseCoopers PwC held on Thursday
Andrew S. Nevin partner & chief economist, PwC Nigeria said there are projections that Nigeria may become the second-most populous country in the world hence the country must establish its own growth and development path looking internally.
He said the country needs a significant inflow of Foreign Direct Investment (FDI) of at least 26 or 28 percent for economic recovery as it will bridge the infrastructure gap and encourage economic diversification. This he said can be achieved through a visible improvement in the business environment as well as an increased and assured level of security.
he recommended that Nigeria unlock its dead assets and embark on bridging its infrastructure deficit, “Nigeria holds as much as $900 billion worth of dead capital in residential real estate and agricultural land while the value of the federal government’s abandoned properties are about N230 billion,”
He added that a huge part of the global economy is made up of the services sector which is a higher value-added hence Nigeria should drive its export growth and diversification through its services especially the country’s creative and cultural industries which could generate as high as $1 in export revenue.
Taiwo Oyedele, Fiscal Policy Partner and Africa Tax Leader, PwC Nigeria highlighted that the rebound and success of the private sector are important to the anticipated economic rebound however challenges in the business environment will undermine the impact of businesses.
He said chief executives of businesses have in 2020 highlighted policy uncertainty, overregulation, exchange rate volatility, tax issues, cyber threats inadequate basic infrastructure as top threats to businesses.
“The challenges have increased in 2021 as the pandemic and other health-related issues, social instability, rising unemployment and uncertain economic growth have aggravated them, “he said
He urged that the challenges are addressed and the business environment made more comfortable for businesses to thrive, which will have a ripple effect on economic growth
Ayodele Teriba, Chief Executive Officer, Economic Associates Teriba who doubles as the Chairman of the Economics and Statistics Committee, LCCI said Nigeria’s real estate sector is a gold mine that can unlock abundant and diversified growth, hence he asked that the government gives its prime attention.
Toki Mabogunje, President, LCCI mentioned that the first half of the year experienced a significant rebound in business and economic activities following the vaccination exercise, however, recovery from the impact of the pandemic remains fragile as key sectors with the potential to facilitate economic growth are still suffering the lingering impact of the COVID-19 disruptions.
Mabogunje said projections of improvement in growth performance has been projected by both the IMF and the World Bank however, anticipated growth may be dampened by rising security tensions, lingering liquidity constraints in the currency market, low vaccination rates and poor implementation of critical reform policies.
She advocated the implementation of policies needed to quicken economic growth, while engagement between the private and public sectors improves to foster sustainable economic recovery.