The Director-General of the African Development Bank Group’s Nigeria Country Department, Mr Lamin Barrow, has said the Nigerian government’s plan to lift 100 million Nigerians out of poverty by 2030 is threatened by the high rate of unemployment and income inequality in the country.
He said this while representing the AfDB President, Dr Akinwumi Adesina, as a panellist at an investors’ webinar to showcase the investment opportunities in Nigeria’s privatisation and economic reform programme on Tuesday.
Barrow noted that the recovery in crude oil prices, increase in the Value Added Tax rate to 7.5 per cent and elimination of fuel subsidies would provide some fiscal relief for the Nigerian economy.
He said, “Fiscal risks are likely to remain elevated in the medium-term due to high dependence on oil receipts, weaknesses in non-oil revenues (less than four per cent of GDP) and high debt service payments (exceeding 60 per cent of federally retained revenues) amidst spending pressures. Besides the uncertainties associated with the pandemic, other downside risks to the medium-term growth outlook include fiscal pressures – (fiscal and current account deficits and financing); persistent (food) inflation; insecurity and high levels of unemployment, which has increased to 33.28 per cent (and especially youth unemployment – estimates range from 38 to 42.5 per cent). The poverty headcount has increased, with approximately five million more Nigerians likely to have been pushed into poverty in 2020. High unemployment and income inequality (35.1 per cent in 2020) pose significant challenges to government’s objective to lift 100 million people out of poverty by 2030”.