Nigeria Economic Summit Group (NESG) said the government is not maximising the economic potential of the country due to theft, vandalism, and other challenges.
NESG board chairman Asue Ighodalo in a communique issued at the end of a meeting of its Board of Directors said low production rate, theft, and pipeline vandalism have combined to rob Nigeria of the benefits of high cost of crude oil in the global market.
Ighodalo stated that declining investment and divestment, high cost of production, and a harsh operating environment also contributed to robbing Nigeria of the benefits.
“Nigeria is not appropriating the benefits of high global prices. As a result, fiscal pressure is imploding because of declining revenues and soaring public debt,” Ighodalo said.
He said that the growing deficit meant that Nigeria would rely on borrowing to finance the 2022 budget.
Ighodalo lamented that despite an increased budgetary allocation to defence and national security, insecurity had not reduced.
He noted that “there is hardly any need to itemise the adverse impact of insecurity on food prices, productivity, ease and cost of doing business, investor confidence and national pride.”
Ighodalo said the NESG would continue to offer policy advice to any government in power in the national interest while commending the Federal Government for initiating the recently-launched National Development Plan (2021–2025).
“We remain resolute in our mandate – we will continue to be in the vanguard of economic reforms and positive change,” Ighodalo said.
“The Board of Directors of the NESG notes and commends the Federal Government for commencing the implementation of the Medium-Term National Development Plan (2021–2025).”
He urged the government to “take decisive action to tackle its revenue challenges” that created room for rising national debt.
The NESG board chairman attributed revenue challenges to leakages through oil theft, difficult operating environment for businesses, and lack of innovation in tax collection.
“We strongly believe these leakages have continued unabated because of the absence of sanctions and ineffective tax systems,” Ighodalo said.
“We must return to the path of debt sustainability in the face of dwindling revenues not to create a debt burden for future governments and, indeed, future generations.
“We must prioritise our expenditure, limit our spending to items we can sustain, and eliminate wastage and graft in government.”
Ighodalo recommended “greater transparency and simplicity in the management and communication of various subsidies, like in petroleum products and electricity, to establish their true costs that benefit the people.
He noted that his recommendation can ensure food self-sufficiency by prioritising critical value chains and supporting private sector-led interventions.