Financial analyst Oluwaseyi Odufuwa said Nigeria’s ambition to build a $1 trillion economy by 2030 is achievable if key policies are implemented within the next three years.
Odufuwa, who is also the Managing Director of Capital Plus, made the assertion in an interview with NAN in Lagos on Wednesday, noting that sustainable finance is essential for long-term economic growth.
“President Bola Tinubu has emphasized the need for Nigeria to achieve a $1 trillion economy by 2030. Although this goal is achievable within the next six years, some economic experts believe that current economic trends “We are expressing skepticism based on this,” he said.
Odufuwa, an investment banker with more than 20 years of experience, said the $1 trillion target is realistic if Nigeria adjusts its monetary and fiscal policies.
He noted that Nigeria’s Gross Domestic Product (GDP) currently stands at $253 billion, with a growth rate of 3.2% in the second quarter of 2024, compared to 2.51% in 2023.
He added that the 2024 budget growth rate indicator was 3.76%, but the current growth rate of 3.1% is a sign of progress, although not ideal.
Mr. Odufuwa stressed that to achieve a $1 trillion economy, Nigeria’s GDP growth rate needs to increase to a minimum of 6 percent annually. He outlined some key policy priorities for the government to achieve this goal.
Mr. Odufuwa stressed the need to curb inflation, particularly headline inflation and food inflation, noting that both have remained high in recent years.
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“Food inflation accounts for 40% to 41% of headline inflation.
“The headline inflation rate has only fallen to 33.4% year-on-year, but it remains high.
“Tackling food insecurity could reduce inflation to around 28% or 29%, increasing food self-sufficiency and freeing up foreign exchange (FX) from food exports, which in turn would expand GDP,” he said. I guess,” he explained.
Mr Odufuwa also called for a reduction in the debt service to revenue ratio to increase liquidity in the foreign exchange market and support infrastructure development.
He stressed that this ratio has fallen from 97 percent to 63 percent, while the global standard is 22.5 percent, according to the World Bank.
“If the government maintains this downward trend, more funds will be available for capital projects, thereby stimulating economic growth and increasing GDP,” he added.
Experts said the government needs to meet the Organization of the Petroleum Exporting Countries (OPEC) goal of increasing crude oil production from the current 1.4 million barrels per day to 2 million barrels per day.
Although he acknowledged that security concerns in oil-producing regions were an obstacle, he pointed out that if the country reaches its 2 million barrel per day target, production could be worth more than $1 billion a month.
The analyst said this would ease pressure on the naira and boost economic growth.
Odufuwa called for a change in the basis of Nigeria’s GDP, the last time in 2014, when GDP increased from $270 billion to $510 billion (a 90% increase).
He said the National Bureau of Statistics (NBS) is considering further GDP rebasing, which, if implemented, could significantly boost current GDP.
On economic diversification, he criticized Nigeria’s dependence on oil and called for increased focus on agricultural exports, which currently account for 16.8% of GDP at $42 billion.
“Nigeria needs to expand its agricultural export capacity to capture more foreign exchange and stimulate growth,” he said.
