The Advisory Partner & Chief Economist of PricewaterhouseCoopers (PwC), Dr. Andrew Nevin said that Nigeria neither has a revenue problem, nor a debt problem, but a growth problem.
This was made known on Saturday, February 4, 2033, by Nevin while speaking at the first Webinar session organized in 2023 by Nairametrics, with the theme: ‘2023 Economic Opportunities to Mitigate Impact of Headwinds.’
Nevins, in the statement, said that he disagrees with Nigeria’s minister of finance, who has on many occasions said “Nigeria doesn’t have a debt problem, but revenue problem.
He said from the trajectory where economic growth is not more than population growth the country is going to come to a situation where GDP per capita is going to fall, and that would induce a debt crisis, probably where the country is right now.
He said when Nigeria has a growth of 3% and the government becoming more predatory over the last couple of years towards businesses and individuals in extracting value, it becomes a very difficult situation.
- He said, ”if Nigeria were at 10% growth a year, the country could have tax revenues growing at 15% a year, and the system would work, but right now it’s not working. “But we continue to say it’s a growing problem; people don’t want to invest in this country because we’re not growing. So I think we’re in a crisis right now but for the next government it will take policies to fix them.”
Dead Assets
Nevin said Nigeria can grow its economy by putting its many dead assets to use. He said one of Nigeria’s major dead assets is its real estate assets that are not being put to optimal use. He listed some of the federal government’s dead assets including the Ajaokuta Steel Plant and Nigeria’s refineries. He said Nigeria needs to unlock its dead assets to grow; if not, there will be a problem.
He also urged the Nigerian government to invest in educating the youth population and exporting services. He said Nigeria was already doing well in services export than goods export. Nevin drew strength for his proposition from the Indian economy, which he said is already exporting services to the tune of $200 billion.
Invest in self
Dr. Nevin earlier in his comment yesterday said currently, brain capital is the best investment in Nigeria. He said investing in the broader economy is very risky because of inflation. He stated that over the past eight years, Nigeria has had a very harsh business environment, with the local currency losing its store of value characteristic, and getting harsher. He said he would not encourage individuals to take the risks prevalent in the Nigerian investment environment.
- “What I might say to people is, if you want to hedge against the harsh environment, the people that are doing well in this country are people that invest in themselves, invest in brain capital,” he said.
Investment in brain capital has always and will always win out. In most Countries of the World, people who are educated have generally done better than those who didn’t. The differential in pay and benefits is accelerating between the educated and the non educated. And the more advanced the education, the more pay new jobs in IT and Energy Industries are willing to pay. Many Countries have flung their borders open to the well educated since the pandemic.