Prof. Ndubisi Nwokoma, Director, Centre for Economic Policy Analysis and Research (CEPAR), on Friday said the Federal Government must institute structural reforms to achieve its 3.75 per cent GDP growth projection for 2023.
Nwokoma said this in a statement titled, “Nigeria’s Economic Outlook 2023,” released in Lagos.
He was emphatic that the Federal Government must implement structural reforms that would further support the fight against inflation by improving productivity and removing or easing supply chain disruptions.
He advised the government to address the vexatious oil theft if progress in revenue enhancement was to be achieved.
he CEPAR director also called for a reduction in cost of governance across the three tiers of government.
Nwokoma advocated an urgent collaborative effort by policy makers and the Federal Government to restore macro-economic stability by expanding agricultural spending in order to achieve future resilience in the sector.
He also said there was need for fiscal policies that supported current efforts by the Central Bank to curb inflation in order to protect the vulnerable in the country.
“Nigeria needs real leadership in order to address debt crisis and fiscal challenges by tightening tax loopholes and reducing cost of governance,” he said.
He added that the monetary policy should stay the course to restore price stability, and also, fiscal policy should aim to alleviate the cost-of-living pressures while maintaining a sufficiently tight stance aligned with monetary policy.
Nwokoma added that fiscal policy should help the economy to adapt to more volatile environments by investing in productive capacity, human capital, digitisation, green energy and supply chain diversification.
According to him, the growth rate projection can only be achieved when a visionary leader is elected in the 2023 election.
“With expansion in expenditure programmes and shrinking government revenue, the Nigerian economy appears to be headed for a major crisis similar to the situation in Venezuela and Sri Lanka which currently have debilitating economic crisis.
“As a major oil producing country in Africa, Nigeria has not benefitted sufficiently from both the recent increase in oil prices and high demand in crude oil due to the Russia/Ukraine war.
“This is due to the reported prevalent massive oil theft as well as pipeline vandalisation which inhibit the country from meeting up with its production quota from the Organisation of Petroleum Exporting Countries (OPEC)
“So, 2023 appears bleak in terms of GDP growth,” he said.
On inflation, the economist said the target rate of 17 per cent in 2023 budget might not be attainable given the preponderance of many inflation-inducing factors such as the proposed fuel subsidy removal as well as instability in the exchange rate.
According to him, this could be worse than the present 21.7 per cent recorded in the third quarter of 2022.