The Managing Director of Cowry Asset Management Limited, Mr. Johnson Chukwu, has said that the Nigerian government will have to focus on developing key sectors, which include manufacturing, ICT, and trade to grow the country’s economy. This is even as he declared that agriculture can not sustain the economy, but will only ensure food security.
Chukwu, who stated this at the Nairametrics Economic Outlook webinar held on Saturday, July 16, with the theme: ‘Resetting Nigeria’s economic growth trajectory, said the government must look beyond agriculture to focus on these key sectors that are capable of growing the economy. According to him, agriculture, in most countries is basically focused on food security.
He adds that there is no economy in the world today that has become industrialised based on agriculture because agriculture is basically an extractive industry and can never be the engine of economic growth.
Drivers of economic growth
Food Security is key but won’t drive economic growth
- The Cowry Assets MD who was one of the guest speakers at the webinar said: “It is absolutely necessary for us to have what we call food security. So, agriculture is important, but it’s not what will lead us to become a sophisticated, industrialized, and developed economy.”
- “Now let’s look at the sectors that are critical; the manufacturing sector today accounts for just about 4% or thereabout of the GDP. And unfortunately, that is the sector that should create employment for an economy where about 45 million youths are unemployed.”
- “You need to grow the sectors that will create employment and to grow the manufacturing sector we need to do the heavy lifting by addressing the issue of infrastructure. We need to address the logistic issues at the seaport for import and export of goods and services, the airports, the transport infrastructure, the rail lines, the highways, and then make funding available to manufacturers,” he added.
On Information technology
- “The second largest contributor to the economy today is the ICT sector. And for the last six years ICT used to grow at almost 20 to 30%, and it’s now growing at about 12%. So, we need to focus on that sector, and it’s actually the new economy. That’s where the digital economy is. That’s one sector that the government must do everything to stabilise.
- “If you look just a few years back, you will realise that the government’s policies seem to be anti-ICT. The heavy tax on MTN had to be resolved politically and it doesn’t seem that we recognise that this sector is critical to other sectors of the economy.”
- “If you go to Western countries today, the availability of broadband internet is considered one of the critical infrastructure supplies. If you go to any open space in any Western country, you can enjoy free Wi-Fi services, which we must do,” Chukwu stated.
- He said the third largest contributor to the economy is the trade sector. According to him, the sector accounts for about 16.1% of the GDP despite the fact that the economy had been in recession for a long time. He believes that the government will also need to pay serious attention to this sector to grow the economy.
On SME’s Johnson Chukwu insisted that they were the engine of growth for Nigeria and should be given all the support they require to grow.
“SMEs should be given focus and should be the engine of growth in the country”
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The Nairametrics Economic Outlook is organized to enlighten stakeholders, business owners, and Nigerian consumers alike on what the year holds as well as the expectations with regard to government reforms and policies and their resulting effect on Individual consumers in the year.