The Minister of Finance, Wale Edun, and the Central Bank of Nigeria (CBN) Governor, Olayemi Cardoso, have implemented various economic reforms and policies aimed at stabilizing the economy and promoting growth. Their efforts have yielded some positive results, but challenges persist.
The CBN has made significant strides in unifying the exchange rate, reducing the gap between official and black market rates to about N40.6. Although the naira has depreciated to N1,579.4 per dollar, the CBN has achieved a more stable exchange rate, which is crucial for attracting foreign investment and promoting economic growth. Net foreign exchange reserves have risen from $3.7 billion to $23.11 billion, according to CBN financials, a testament to the government’s efforts to stabilize the economy.
On the fiscal policy front, the government has reported a steady increase in revenue, with a focus on tax reform and eliminating multiple taxation. The 2020 budget implementation saw 92.3% expenditure, with debt service and personnel costs performing 100%. The Federal Government has also disbursed N233 billion to states under the States Fiscal Transparency, Accountability, and Sustainability (SFTAS) Programme, promoting fiscal transparency and accountability at the state level.
The government’s efforts to attract foreign direct investment have also shown promise. Nigeria successfully issued Eurobonds without a traditional roadshow, demonstrating strong global investor confidence. The government has prioritized attracting foreign direct investment through strategic international partnerships and policy-driven economic reforms.
The removal of fuel subsidies in Nigeria has significantly impacted government revenue and the economy. With subsidy removal, the government can allocate funds previously spent on subsidies to critical sectors like infrastructure, education, and healthcare, potentially stimulating economic growth. The government has reported a steady increase in revenue, with current monthly revenue from oil and gas standing at N1.33 trillion.
However, the increase in fuel prices has led to a significant rise in the cost of living, affecting transportation costs, food prices, and overall cost of living. Despite these challenges, the government is optimistic that subsidy removal will lead to economic revitalization in the long run. The commencement of production at the Dangote Refinery is expected to increase fuel supply and potentially reduce prices, mitigating some negative impacts .
Despite these positive developments, challenges persist. Inflation dropped to 23.71% after rebasing the Consumer Price Index (CPI), but it’s still higher than the 22.22% inherited by President Tinubu. The naira’s value remains a concern, and the government needs to continue implementing policies that promote economic stability, transparency, and accountability.
The unemployment rate in Nigeria declined to 4.3% in the second quarter of 2024, indicating that approximately 9.87 million Nigerians are presently unemployed. This figure includes those who have experienced job loss and those who recently joined the labor force. The youth unemployment rate stands at 6.5% among youth aged 15-34 years, with 4.18 million Nigerian youths unemployed.
The Nigerian government has introduced several initiatives to address unemployment, including the N-Power Program, National Social Investment Program (NSIP), and Youth Enterprise with Innovation in Nigeria (YOU WIN). These programs aim to promote economic growth, create jobs, and empower young Nigerians. However, despite these efforts, unemployment remains a significant challenge, with a large population, lack of quality education and training, corruption, and insecurity contributing to the issue.
To make meaningful progress, the government needs to prioritize investments in human infrastructure, promote economic growth, and create jobs. By continuing to implement effective policies and programs, Nigeria can reduce unemployment and promote economic growth and development. The government must also address the issue of informal employment, which accounts for 93.0% of total employment, and work towards creating more formal job opportunities for Nigerians .
To achieve sustained economic growth and development, Nigeria must build on the progress made so far. The government should focus on promoting economic diversification, investing in infrastructure, and improving the business environment to attract more foreign investment and drive economic growth. With continued implementation and adaptation to changing economic conditions, Nigeria can navigate its economic challenges and achieve a brighter future.