Presidential-elect Bola Tinubu
By Philip Ibitoye
Like a ravenous beast consuming everything in its path, Nigeria’s government continues to gobble up debt, with the Debt Management Office forecasting a possible N77 trillion debt by mid-2023. This is unsurprising to many citizens who are well aware of their government’s insatiable appetite for borrowing.
Like a relentless wave crashing against the shore, Nigeria’s inflation rate shows no signs of abating, with the National Bureau of Statistics revealing a 21.47% increase in November 2022, marking the tenth consecutive month of rising prices. This persistent surge reflects the mounting pressure on the economy and a population that continues to see diminishing purchasing power with their wages.
A bleak picture has been painted by the Multidimensional Poverty Index report from the National Bureau of Statistics, revealing that a staggering 133 million Nigerians, or roughly 63% of the population, are suffering from multidimensional poverty. With an estimated population of 200 million, it is clear that Nigeria’s economy desperately requires swift attention and repair.
As the 2023 general election approaches, various presidential candidates have put forth their ideas for reviving Nigeria’s struggling economy. While some plans may be mere empty promises, others, such as Bola Tinubu’s from the All Progressives Congress, appear to be grounded in practicality. Tinubu’s manifesto outlines ambitious plans to reinvigorate the economy and enhance the quality of life for citizens.
Below, we delve into some of the key strategies outlined in Tinubu’s plan for economic rejuvenation.
Importation Substitution
Nigeria is sitting on a goldmine of natural resources, yet it continues to struggle with a chronic importation problem. It’s a paradox that this nation, brimming with resources that should make it a world-class powerhouse, has instead embraced a culture of exporting raw materials and importing overpriced finished products. For instance, despite being a veritable wellspring of crude oil, Nigeria doesn’t even bother to refine its own oil. No wonder the federal government is forced to dig deep into its pockets – pockets that are already stretched thin – to subsidize the import of petroleum products. In fact, the Minister of Finance has revealed that the government has been borrowing money just to keep up with these oil subsidies. It’s a vicious cycle of spending money on things that Nigeria has in abundance rather than using its own resources to create them.
There’s a glimmer of hope on the horizon for Nigeria’s importation problem, and it comes in the shape of a plan from Tinubu. The former Lagos governor has laid out a strategy to reduce the country’s dependence on imported goods, including the use of policy measures such as luxury taxes, higher processing fees, and higher tariffs on non-essential products. He’s also proposing sweeteners for international brands, such as tax credits and rebates, to set up companies and manufacture products for export in Nigeria, while also meeting the needs of consumers within the country. If Tinubu has the determination to push for more exports and fewer imports, it could be a game-changer for Nigeria’s economy.
Tax Reform
Nigeria’s financial woes run deep, and it’s no secret that the government is having trouble bringing in enough revenue to balance the books. To plug the deficit in the 2023 budget, which stands at a staggering N10.78 trillion, the government is resorting to borrowing and selling off national assets. In fact, new borrowings alone are expected to total N8.80 trillion. One of the main reasons for the revenue shortfall is the country’s tax problem, but it’s not so much about the amount being collected as it is about the number of people and businesses being taxed. The tax net in Nigeria is just too narrow, which has severely impacted the government’s ability to bring in the funds it needs.
Tinubu’s economic plan recognizes that trying to squeeze more money out of people during tough economic times is a recipe for disaster. Instead, his administration is proposing a smarter approach to taxation that includes creating a progressive tax system, closing up sneaky loopholes, improving the efficiency of collection, and fostering a greater sense of responsibility among taxpayers. This last point is crucial for building trust and showing Nigerians that their hard-earned money is being used wisely by the government. After all, it’s no secret that many people in Nigeria are hesitant to pay their taxes due to distrust of the government.
By demonstrating transparency and accountability, the government can win over skeptical taxpayers.
The Tinubu economic plan promises to make the most out of government revenue, using the same savvy techniques that helped generate record levels of internally generated revenue in Lagos State. According to the presidential candidate, his administration will be laser-focused on creating wealth and attracting investment, using the skills and expertise that have proven successful in the past. In other words, Tinubu is saying that he will be using every trick in the book to optimize revenue and drive economic growth.
War against Corruption and Undue Expenditure in Governance
Even if we manage to increase government revenue, it’s all for nothing if most of it falls into the wrong hands due to corruption. That’s why the Tinubu economic plan is such a breath of fresh air – it’s taking a hardline stance against corruption and waste in government. With civil service theft that’s swollen to the point of bursting, it’s no wonder that Nigeria’s government is hemorrhaging money. It’s time to cut out the fat and make sure every kobo is spent wisely.
Despite many leaders’ assurances to trim government expenses, very few attempts have been made to turn those promises into reality.
Tinubu’s vow to tackle waste in government may not inspire a lot of confidence, but there is a spark of hope since he is addressing the issue. His strategy aims to reform the civil service to combat corruption, streamline agencies, and eliminate inefficiency and waste. If he can follow through on these commitments, the federal government will have more resources to invest in improving the lives of Nigerians.
National Industrial Plan
As the saying goes, “the rich get richer,” and in the case of the world’s wealthiest countries, this is often due to their reliance on industrialization to drive economic growth. Given this, it makes sense that Tinubu’s economic plan puts a premium on promoting industries that are key to the country’s development. This includes offering tax breaks and other incentives, as well as urban youth employment incentives to domestic manufacturing enterprises.
Additionally, the plan aims to create hubs of industry in each area of the country, from major players to smaller operations. All of these efforts are aimed at revving up the engines of economic growth and ensuring that the country continues to thrive.
If implemented religiously, the industrial plan could be a game-changer in driving down Nigeria’s sky-high youth employment rate. Agrreably, plans do not always transform into reality, but the robust Tinubu economic plan oozes hope, and Nigerians can dare to dream.
Philip Ibitoye writes for Eko Hot Blog. This media platform reserves all rights to this article.
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