Rewane: Don’t Be Deceived, Nigeria Remains World’s Poverty Capital

Bismarck Rewane, a revered economic expert, has advised Nigerians not to be deceived by the increasing Gross Domestic Product (GDP) and declining inflation rate, as he said the country remains the world’s poverty capital.

Bismarck Rewane, the Chief Executive Officer of Financial Derivatives Company Limited, has stated that Nigeria is still the world’s poverty capital even though her Gross Domestic Product (GDP) is rising and the inflation rate is dropping.

The highly-revered economic expert made this known in his presentation at this month’s edition of the LBS Breakfast Session.

Rewane, who’s a member of the Presidential Economic Advisory Council (PEAC), posed what he described as five tough questions for Nigerian policymakers.

“Cheery news and angry people! Why? (Why is GDP up and income levels down?). Beans 122.22 percent, pepper 100 percent, flour 61.54 percent but inflation is falling! Wow! What is the truth?

“The best hedge against inflation? Real estate/equities/bitcoin or precious metals? Will the naira crash to N600/$ as BDCs scramble? Is the PIA (Petroleum Industry Act) going to make things better for us? 1. Petrol 2. Insecurity 3. New investments,” he queried.

Recently, the National Bureau of Statistics (NBS) disclosed that the country’s GDP grew by 5.01 percent in the second quarter of this year (2021) as against 0.51 percent in Q1 while inflation dropped to 17.38 percent in July from 17.75 percent in June.

Fielding responses to his queries, Rewane explained that “fastest growing sectors were the most impacted by the COVID-19 pandemic. They are job-elastic and have the potential to boost productivity.

“Real GDP (2.7 percent) still below potential GDP (8.3 percent). The economy is still in a recessionary gap. Population (3.2 percent) growing faster than GDP.”

Citing data from the World Bank, Rewane said no less than seven million Nigerians fell into extreme poverty in 2020, adding, “Nigeria still the poverty capital of the world: 93.9 million people now live below the poverty line.”

According to him, people are angry because the socioeconomic conditions have worsened.

He added: “Youth unemployment fast approaching 45 percent. The misery index, 50.68 percent. Nigeria [is] a hunger alert hotspot, according to FAO and WFP. Over 18,000 Nigerians seeking asylum. Health sector brain drain rising (e.g. about 500 doctors moving to Saudi Arabia).

“Positive GDP growth yet to have a significant impact on socio-economic conditions. Strategic investment and increased stimulus in job-elastic sectors and elimination of leakages (misaligned exchange rate and subsidies) necessary to achieve sustained economic recovery and inclusive growth.”

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