AfDB’s President Dr. Adesina asserted Robust Private Sector could Expedite Diversification of Nigeria’s Economy
By Abdul Rahman Bangura-
NEW AFRICA BUSINESS NEWS (NABN) Freetown, Sierra Leone– The theme of the summit is, “Trade and Non-Oil: Changing the Narratives for Rapid National Development.” Adesina, was represented by Lamin Barrow, Director-General, Nigeria Country Department of AfDB. The AfDB’s President noted on July 10th, 2023 in Abuja at the second edition of Nigeria Employers’ Summit.
“The unification of the exchange rate management system is an important reform by the new administration that will enhance transparency in the allocation,” he announced.
Adesina explained an active and competitive private sector has the potential to expedite the diversification of Nigeria’s economy and strengthen exports. He said the private sector development in Nigeria was nonetheless paralyzed by policy inconsistencies and implicit taxation.
The AfDB president said it was awful many private-sector firms in Nigeria were overburdened by tacit taxes. Adesina said the companies provide their electricity, sink boreholes to get access to water and repair roads around their places of operation.
“It is therefore not surprising that foreign direct investment (FDI) inflows have decreased from 8.8 billion dollars in 2011 to only about $469 million in 2022, the lowest in a decade,” he asserted.
He told nearer alliance and dialogue between the Federal Government and the private sector was necessary to chisel out strategies that would position Nigeria as an ideal investment destination. He further told Nigeria could moreover benefit from the experience of countries that have been prosperous in attracting FDI into their manufacturing sectors.
“Nigeria can become a manufacturing hub in Africa if the Federal Government implements a bold strategy to take advantage of investment and market access opportunities.
“Rising labor costs and technological upgrading in countries such as China, India, and Brazil offer an excellent opportunity to developing economies, including Nigeria, to attract FDI and diversify their exports.
“Promoting trade and regional integration trade offers a great opportunity to further diversify the Nigerian economy.
“With the coming into force of the African Continental Free Trade Area, Africa is becoming more integrated, with a larger market for exports from Nigeria,” he announced.
Adesina said Nigeria faced major infrastructure debts that hinder its proficiency to diversify production in the non-oil sectors. Referring to the World Bank’s 2022 Public Expenditure Review report, Adesina told that meeting Nigeria’s huge infrastructure needs required $3 trillion by 2050.
He said at the current rate, it would take Nigeria 300 years to provide a minimum level of infrastructure desired for development. Adesina, still let out to change this narrative, Nigeria should mobilise the private sector for infrastructure development and service delivery.
He said this would also reduce the fiscal burden on the Federal and State governments.
According to the president, energy sector investments remain one of the most critical and urgent needs in Nigeria.
He said giving credible and accessible energy services would make Nigeria’s industries more competitive and accelerate the country’s integration into regional and global supply chains.
“To remove the barriers to non-oil trade and exports, Nigeria must decisively fix its power sector, once and for all. While tapping its abundant gas resources as a transition fuel, Nigeria should invest massively in renewable energy generation, especially solar.
“Nigeria should start leveraging the platform of the $25 billion Desert-to-Power initiative aimed at providing electricity for 250 million people across the Sahel, including the northern parts of Nigeria,” Adesina told.
The AfDB boss said developing regional infrastructure and putting in place the requisite trade policies were necessary conditions for tapping into opportunities in regional and international markets.
“A good starting point is the effective utilization of Trade Agreements to which Nigeria is currently a signatory. Nigeria’s trade policies should prioritize the promotion of value added exports,” he said.
For New Africa Business News (NABN) Abdul Rahman Bangura Reports, Africa Correspondent