The World Bank in its 2019 Nigeria Economic Update Report has warned that Nigeria might be home to 25 per cent of the world’s destitute people if the government fails to revive economic growth and create jobs.
The Breton Woods-based financial institution urged the Muhammadu Buhari-led administration to increase domestic revenue, remove trade restrictions and improve the predictability of economic policy following a projection of the number of Nigerians living in extreme poverty increased by more than 30 million by 2030.
The World Bank also stated that Nigeria’s economic growth projected to pick up from 1. 9 per cent in 2018 to two per cent in 2019, is vulnerable to external and domestic risks including geopolitical and trade tensions that may affect inflows of private investment. It also warned that the country might slide back into recession if crude prices fall by 25 per cent to $50 a barrel.
The report read: “Economic and demographic projections highlight the urgent need for reform
“With population growth (estimated at 2. 6 per cent) outpacing economic growth in a context of weak job creation, per capita income is falling. Today, an estimated 100 million Nigerians live on less than $1. 90 per day.
“Close to 80 per cent of poor households are in northern Nigeria, while employment creation and income gains have been concentrated on central and southern Nigeria.
“Nigeria’s economy is expected to grow by 2. 1 per cent in 2020 and 2021, compared to an annual population growth rate of 2. 6 per cent.
“Nigeria’ s economy is recovering gradually from the 2016 recession, with growth projected to pick up from 1. 9 per cent in 2018 to two per cent in 2019
“But the projected growth outlook is vulnerable to external and domestic risks, including geopolitical and trade tensions that may affect inflows of private investment.
“Nigeria has the opportunity to advance reforms to mitigate these risks amid growing public demand for greater economic opportunities.
“President Muhammadu Buhari should increase domestic revenue, remove trade restrictions and improve the predictability of economic policy.
“Nigerian government should remove expensive fuel subsidies and reduce lending to targeted sectors that crowd out banks. Failure to take actions would see more Nigerians falling into extreme poverty.
“The cost of inaction is significant. Under a business -as- usual scenario, where Nigeria maintains the current pace of growth and employment levels, by 2030, the number of Nigerians living in extreme poverty could increase by more than 30 million,” the Bank warned.