5 Questions About Nigeria’s Road to Recovery

Must Read

List of United Bank for Africa (UBA) Sort Codes & Branches (with addresses) in Nigeria

The sort code is a number that usually identifies both the bank and the branch where an account is held. The sort...

List of Access Bank Sort Codes & Branches (with addresses) in Nigeria

The sort code is a number which usually identifies both the bank and the branch where an account is...

List of First Bank of Nigeria Sort Codes in Nigeria

The sort code is a number that usually identifies both the bank and the branch where an account is held. The sort...
- Advertisement -

The COVID-19 pandemic has placed Nigeria at a critical juncture. The country entered the crisis with falling per capita income, high inflation, and governance challenges.

Policy adjustments and reforms designed to shift the country from its dependence on oil and to diversify the economy toward private sector-led growth will set Nigeria on a more sustainable path to recovery.

5 Questions About Nigeria’s Road to Recovery Brandspurng
A street scene in Nigeria’s capital city Lagos. The country is being encouraged to take exchange rate reforms and mobilize more revenue to strengthen its recovery from the pandemic. (photo: IMF Photo/Ebun Akinbo)

The IMF’s latest economic assessment of Africa’s largest economy recommends exchange rate reforms and strengthened efforts to increase government revenues.

What is the economic outlook for Nigeria in 2021 and beyond?

Nigeria’s recovery is expected to be weak and gradual under current policies. Real GDP growth in 2021 is expected to turn positive at 1.5 percent. Real GDP is expected to recover to its pre-pandemic level only in 2022.

- Advertisement -

The near-term outlook is subject to downside risks from pandemic-related developments with Nigeria experiencing a second wave.

Over the medium term, a subdued global recovery and decarbonization trends are expected to keep oil prices low and Organization of the Petroleum Exporting Countries quotas in place, restricting oil-related activities, fiscal revenues, and export proceeds. Non-oil growth is also expected to remain sluggish, reflecting inward-looking policies and regulatory uncertainties.

How can Nigeria’s movement toward a unified exchange rate and greater flexibility help with the recovery?

The current system creates uncertainties for the private sector because of multiple exchange rates and non-transparent rules for foreign exchange allocation. Unifying the various rates into one market-clearing rate would establish policy credibility.

Sustained premiums in the parallel market and unmet foreign exchange demand indicate the need for further adjustment in the exchange rate to reduce the gap between supply and demand.

- Advertisement -

An appropriately valued exchange rate and a clear exchange rate policy would also help instil confidence and private sector-led recovery. Policy clarity is also important to attract larger capital inflows, including foreign direct investments, which have dropped significantly in recent years and successful diversification.

Five Questions About Nigeria’s Road to Recovery BRandspurng

How can the government raise more revenues to ensure a sustainable fiscal position?

Nigeria has one of the lowest revenue levels as a share of GDP worldwide. A large share of revenues is spent on the country’s public debt service payments, leaving insufficient fiscal space for critical social and infrastructure spending and to cushion an economic downturn.

Read Also:  Market Resumed The Week on a Positive Note...ASI Crossed 39,000 Points

In this context, mobilizing revenues through efficiency-enhancing and progressive measures is a top near-term priority. Revisiting tax exemptions and customs duty waivers, increasing and broadening the base for excise taxes, developing a high-integrity taxpayer register, enhancing digital infrastructure, and improving on-time filing and payment are important measures.

- Advertisement -

Once economic recovery takes root, Nigeria will need to increase the value-added tax rate to at least 10 percent by 2022 and 15 percent by 2025—the average in countries belonging to the Economic Community of West African States—to create effective fiscal space.

Five Questions About Nigeria’s Road to Recovery BRandspurng

Why is economic diversification important for Nigeria?

Nigeria’s export structure has not fundamentally changed over the decades, with hydrocarbon products still accounting for 90 percent of the country’s exports today as they did in the 1970s. Successful economic diversification requires trade openness and competitive discipline.

The experience of Malaysia, Indonesia, and to some extent India has shown that a shift toward export-oriented industrialization can boost GDP. The limited gains from inward-oriented policies in terms of creating jobs and improving living standards suggest that Nigeria needs to change course.

To accommodate a growing number of young people entering the labour market, Nigeria will need to create at least 5 million new jobs each year over the next decade. Based on the experience of other countries, embracing more open trade and competition policies would help diversify the economy and reinvigorate growth, particularly as the African Continental Free Trade Area takes effect.

Five Questions About Nigeria’s Road to Recovery BRandspurng

What transparency measures has Nigeria put in place to ensure emergency spending is going toward its intended use?

The authorities have adopted measures to facilitate tracking and reporting of emergency spending. The government has created new budget lines with monthly expenditure information on emergency funding, which are posted on the Ministry of Finance’s Transparency Portal, although users have found it difficult to access the data.

The Bureau of Public Procurement has issued guidelines on COVID-19 emergency fund use, and the Nigeria Open Contracting Portal has been publishing-related procurement contracts, although some contract details on beneficiary ownership are yet to be completed.

Going forward, Nigeria needs to further embrace transparency reforms by expanding the monitoring and reporting of all public spending, as well as ensuring easy public access to spending data.

- Advertisement -
5 Questions About Nigeria’s Road to Recovery - Brand Spur5 Questions About Nigeria’s Road to Recovery - Brand Spur

Subscribe to BrandSpur Ng

Subscribe for latest updates. Signup to best of brands and business news, informed analysis and opinions among others that can propel you, your business or brand to greater heights.

- Advertisement -

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.

5 Questions About Nigeria’s Road to Recovery - Brand Spur5 Questions About Nigeria’s Road to Recovery - Brand Spur

Latest News

Hong Kong Productivity Council Theme of the Year 2021: “Make Smart Smarter”

  • Smarter Era of Intelligent Manufacturing Launch Ceremony
  • Witnesses New Milestone for Reindustrialisation in Hong Kong


HONG KONG SAR - Media OutReach - 26 February 2021 - The Hong Kong Productivity Council (HKPC) launches a series of activities in 2021 themed "Make Smart Smarter". The campaign with "Smarter Era of Intelligent Manufacturing Launch Ceremony" was kicked off today, revolving around the theme of "reindustrialisation".


5 Questions About Nigeria’s Road to Recovery - Brand Spur

The "Smarter Era of Intelligent Manufacturing Launch Ceremony" was officiated together by Dr David Chung, Under Secretary for Innovation and Technology, HKSAR Government (fourth from left); Mr Clemente Contestabile, Consul General of Italy in Hong Kong (third from right); Ms Rebecca Pun, Commissioner for Innovation and Technology, HKSAR Government (second from right); Dr Daniel Yip, Chairman of the Federation of Hong Kong Industries (third from left); Mr Roberto Leone, Managing Director of NiRoTech Limited (first from right); Mr Willy Lin, Chairman of HKPC (fourth from right); Mr Mohamed Butt, Executive Director of HKPC (second from left) and Mr Edmond Lai, Chief Digital Officer of HKPC (first from left).


Co-organised by the Federation of the Hong Kong Industries (FHKI), this spotlight event exhibited and introduced an excellent example of reindustrialisation whose research and development were undertaken by HKPC. Gaining support from the Innovation and Technology Bureau and funding support from the R&D Cash Rebate Scheme of the Innovation Technology Commission of the HKSAR Government, production has been successfully commenced in NiRoTech Limited (NiRoTech), a local intelligent security product manufacturer.

Read Also:  MTN Returns to Profit as it overcomes $1billion Nigeria Fine


This smart production line, named the "OWL" intelligent production line, gives into full play the characteristics of an owl's wisdom, piercing eyes, flexible body, soft neck (360o vision) and agile movement. These perfectly echo the key features of this intelligent production line which has high flexibility, excellent agility to cater for different production needs, stringent and precise production capacity, as well as non-stop operation. Five key "S.M.A.R.T" elements: Speed, Multi-function, Accuracy, Reliability and Traceability, can be seen in this production line offering edges of intelligence and efficiency enhancement.


In order to effectively respond to Hong Kong manufacturers' demands on production space, the "OWL" production line adopts a U-shape compact layout design and incorporates the beauty of the "Industry 4.0" (i4.0) lean manufacturing "vision", significantly reducing the factory area to meet the unique land constraints of Hong Kong. NiRoTech's smart factory only occupies 10,000 square feet, saving 50% of the land. It is also equipped with 12 robots and large amount of customised intelligent automation systems and digital technologies. Compared with traditional manual production, the overall production capacity increases by 1.5 times.


Mr Willy Lin, Chairman of HKPC, and Dr Daniel Yip, Chairman of FHKI, were joined by Mr Clemente Contestabile, Consul General of Italy in Hong Kong; Dr David Chung, Under Secretary for Innovation and Technology, Ms Rebecca Pun, Commissioner for Innovation and Technology; Mr Roberto Leone, Managing Director of NiRoTech; as well as Mr Mohamed Butt, Executive Director of HKPC and Mr Edmond Lai, Chief Digital Officer of HKPC, for the launch of the ceremony.


In his welcoming address, Mr Willy Lin, Chairman of HKPC, said, "HKPC is committed to offering staunch support for Hong Kong SMEs in technology R&D and technical aspects, with the aim of creating value for the industrial development of enterprises with state-of-the-art technologies. The 'OWL' intelligent production line is an excellent example of applying innovative technologies that also fits perfectly with HKPC's theme of this year 'Make Smart Smarter'. As owl represents wisdom, by being smarter and using innovative technologies such as IoT, AI, big data, intelligent robots and smart production processes to unleash production opportunities of i4.0, it will certainly scale up productivity and contribute to successful reindustrialisation in Hong Kong, thus achieving the goal of 'Make Smart Smarter'".


He continued, "It is really encouraging to see this 'reindustrialisation' example witnessing the concerted efforts of the Government, industries, business chambers and HKPC to promote reindustrialisation in Hong Kong! HKPC sincerely urges various sectors to work together to accelerate reindustrialisation for the swift recovery of Hong Kong economy and to ensure the "Made-in-Hong Kong" brand to continue to shine bright in the international arena -- Make Smart Smarter".


Dr David Chung, Under Secretary for Innovation and Technology, said, "the Government has been actively promoting 'reindustrialisation' in recent years by providing support in infrastructure, finance, technology and talents in order to create new area of growth and great job opportunities which would help alleviate Hong Kong's competitiveness. I wish to see more enterprises 'Make Smart Smarter', and make good use of these opportunities provided by I&T, as well as the support from the Government, to work and contribute together in turning Hong Kong into an international I&T hub".


Dr Daniel Yip, Chairman of FHKI said, "This collaboration of HKPC and NiRoTech serves as a valuable reference for industrialists on how to integrate i4.0 into production lines to enhance efficiency, elevating their confidence to set up high value-added manufacturing facilities in Hong Kong. With comprehensive policy support and HKPC's professional consultative service, FHKI believes that more Hong Kong manufacturers will join the force of 'reindustrialisation' by pursuing technological advancement and setting up smart manufacturing plants locally, taking the Hong Kong industries into a new era".


The "OWL" intelligent production line integrates the smart adoption of advanced robots with machine vision, smart electrical and mechanical devices, laser processing and sensor technologies. Also, by incorporating AI, IoT, human machine interface, real-time data collection and data analytic technologies, it ensures the full automation and digitalisation of production, assembly and monitoring to achieve big data analytics. Apart from three technologies whose patents are soon to be applied, the project also assists NiRoTech's business planning in exploring the emerging markets and grasping new opportunities.


Mr Roberto Leone, Managing Director of NiRoTech, said, "Mechatronic Manufacturing in Hong Kong: our strategy was clear from the start when we sought HKPC's assistance for help to realise intelligent production. For some, this goal was still immature and very difficult to achieve, especially with Hong Kong being chosen as our operation hub. Today we can proudly say we have achieved it with the system in Hong Kong operating satisfactorily as schedule. Despite there are challenges as the COVID-19 pandemic was affecting all in 2020, the result is now vividly in front of us, and we can touch it. Yet this is only the first step of a long journey".


For more details about "Make Smart Smarter", please visit the dedicated website: https://smarter.hkpc.org/en/index.html


About Hong Kong Productivity Council

The Hong Kong Productivity Council (HKPC) is a multi-disciplinary organisation established by statute in 1967, to promote productivity excellence through integrated advanced technologies and innovative service offerings to support Hong Kong enterprises. HKPC is the champion and expert in facilitating Hong Kong's reindustrialisation empowered by i4.0 and e4.0 -- focusing on R&D, IoT, big data analytics, AI and Robotic technology development, digital manufacturing, etc., to help enterprises and industries upgrade their business performance, lower operating costs, increase productivity and enhance competitiveness.


The Council is a trusted partner with comprehensive innovative solutions for Hong Kong industries and enterprises, enabling them to achieve resources and productivity utilisation, effectiveness and cost reduction, and enhanced competitiveness in both local and international marketplace. It offers SMEs and startups immediate and timely assistance in coping with the ever-changing business environment, accompanying them on their innovation and transformation journey.


In addition, HKPC partners and collaborates with local industries and enterprises to develop applied technology solutions for value creation. It also benefits a variety of sectors through product innovation and technology transfer, with commercialisation of multiple market-driven patents and technologies, bringing enormous opportunities abound for licensing and technology transfer, both locally and internationally.

For more information, please visit HKPC's website: www.hkpc.org.


5 Questions About Nigeria’s Road to Recovery - Brand Spur
- Advertisement -
BrandsPur Weekly Cartoons
- Advertisement -5 Questions About Nigeria’s Road to Recovery - Brand Spur5 Questions About Nigeria’s Road to Recovery - Brand Spur