Global Consultancy experts, PricewaterhouseCoopers, PwC, on Thursday, March 18, projected that the Nigerian economy could leap through the world rankings to top 10 in 2050 with projected Gross Domestic Product, GDP, of $$6.4 trillion, surpassing Germany, the United Kingdom, France and Saudi Arabia.
Advising the Federal Government to give priority to four sectors – agriculture, petroleum (petrochemical and refining), retail and Information and Communications Technology (ICT), which has the most dominant transmission links to the overall economy, in its efforts at weaning the economy off its over-dependence on oil.
Their expert analysis identifies that these sectors in the medium-to-long term, are key to boosting other sectors like manufacturing.
This was disclosed at the Lagos Chamber of Commerce and Industry, LCCI-PwC organized stakeholders forum on the state of the economy, with the theme “Nigeria: Looking beyond oil.”
Partner and Chief Economist, PwC Nigeria, Andrew Nevin, said Nigeria which is the largest economy in Africa and 22nd globally, requires diversification from the economic over dependence on crude oil.
Forward linkages to agro-processing and other services such as logistics as well as backward integration to input supply sectors could improve farm incomes, increase employment and improve domestic food security.
According to PwC, Nigeria’s intrinsic potentialities lie beyond oil, and harnessing these potentialities has become an imperative, given the expectations of lower for longer oil prices.
Based on recent trends, PwC report reviews the impact of low oil prices on key economic indicators and the real sector through an industry survey which pin points the exchange rate as one of the top challenges facing industries in recent times.
He noted that Nigeria needed to ensure sustainable fiscal management that was resilient to global oil price cycles, given the CBN measures implemented to preserve the foreign reserves and maintain currency stability, such as Capital controls, FX rationing, and restrictions on the importation of certain items
Based on a 2016 PwC interview of foreign companies across Nigeria, the senior partner said corruption, inadequate infrastructure, low skill levels, and macroeconomic uncertainty are the four concerns which stood out as challenges with the business environment.
While admitting however that the transition to a non-oil economy would not be an easy task, Andrew Nevin said the retail sector, holds promises.
He pointed out that consumer spending is the largest driver of the economy, accounting for about 70 per cent of Gross Domestic Product (GDP), adding that the firm expects that this will be the boost for the retail sector growth even as population continues to expand.
As incomes rises along with rapid urbanization, the firm projects that household consumption expenditure could reach $1.1 trillion by 2030, from $317 billion in 2014, which implies a growth of nine per cent through 2030.
The consulting experts projected that Nigeria is likely to see accelerated growth of its digital economy, given Nigeria’s teledensity at 107.87, a large population of young urban people and massive scope to improve Internet broadband penetration.
More importantly, he said the opportunity to leverage technology to generate improved social and economic outcomes across other sectors has been created.