Nigeria's Minister of Finance and Coordinating Minister of the Economy, Wale Edun, has stated that the projected 2025 GDP growth rate of 4.6% falls short of the government's ambitions. Instead, the administration is aiming for a 7% annual GDP growth rate to drive economic transformation and reduce poverty.
Economic Growth and Stability
Speaking at the Arise/KPMG Budget Day on Monday, Edun expressed optimism about Nigeria's economic trajectory. He cited key factors such as:
- Declining inflation
- Improved macroeconomic stability
- A more favorable business environment
"We projected growth at 4.6%, but I think that is not our ambition. Our ambition is to, as soon as possible, get to about 7% per annum GDP growth, because it is at that level that you begin to really lift people out of poverty," Edun remarked.
He identified stronger revenue performance, increased oil production, and savings from fuel subsidy removal as crucial growth drivers.
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Private Sector as the Engine of Growth
Edun emphasized the critical role of the private sector in addressing Nigeria's infrastructure deficit, which requires an estimated $100 billion in annual investment.
"It is not the government budget that will fund, for example, the infrastructure deficit. The plan, the commitment of Mr. President and his policy is to crowd in the private sector."
He highlighted public-private partnership (PPP) projects, including:
- Benin-Asaba Highway
- Lagos-Abeokuta Road
These projects aim to enhance travel efficiency and productivity, with an expected 75% reduction in travel time on key routes.
Strengthening the External Sector
On the external front, Edun pointed to positive economic indicators, including:
- Stable exchange rate
- Trade surplus equivalent to 13% of GDP
- Foreign reserves exceeding $40 billion
He also outlined adjustments in budget funding, shifting from 80% domestic funding to a more balanced mix of:
- 40% domestic funding
- 40% foreign funding
- 20% from other sources
This shift, he explained, creates more room for private sector access to financial markets, fostering greater investment opportunities.
Conclusion
Nigeria's push for 7% GDP growth reflects its commitment to economic reform, private sector-led development, and improved infrastructure. With favorable economic conditions and policy adjustments, the government aims to create an inclusive and thriving economy that benefits all Nigerians.
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