The World Bank latest economic analysis for Nigeria says increasing productivity will be vital to support robust growth and job creation and to keep millions from falling into extreme poverty.
In its latest publication on Africa’s largest nation titled “The Nigeria Economic Update, Jumpstarting Inclusive Growth: Unlocking the Productive Potential of Nigeria’s People and Resource Endowments”, the institution listed priority to include increased policy transparency and improved access to finance.
The report recommended areas where reforms can contribute to economic growth and expand the job market, such as in trade, education and the digital economy.
“Without robust productivity growth, the report warns that living standards will continue to deteriorate, and the number of people living in poverty will continue to rise, increasing by more than 30 million by 2030”, it said.
Marco Hernandez, World Bank Lead Economist for Nigeria, and co-author of the report said: “Nigeria’s population is expected to grow by as much as 35 million in the next decade.
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“Unless the pace of growth and job creation accelerates, the country will account for a quarter of all people living in extreme poverty worldwide.
“Creating new opportunities for this rapidly increasing labor force will require a new economic model based on productivity growth.”
The update analyzes the evolution of productivity in Nigeria and identifies the policies and institutions which can help accelerate Nigeria’s economic expansion and create new job opportunities.
It further outlined four priority areas that would lay the foundation for Nigeria’s transition to a new economic model.
World Bank urged the Nigerian government to: “Ensure policy transparency and predictability, which will be critical to reduce investment risk and promote growth outside the extractive industry;
“Enhance factor quality by investing in infrastructure, strengthening land tenure security, improving educational outcomes, liberalizing the trade regime and enhancing trade and transport facilitation to help develop value chains and facilitate the efficient reallocation of factors of production, making Nigeria more cost-competitive;
“Reduce regulatory discretion to help attract foreign and domestic investment to the non-oil sector, encourage competition, and promote formalization;
“Improve access to finance, which could enable new firms to compete with incumbents and allow more productive firms to scale up their operations.
Additionally, the report recommends building momentum for reforms, which are essential to mitigate risks and promote faster, more inclusive and sustainable growth that improves living standards and reduces poverty.
Select reform areas include: “Leverage trade integration to harness the benefits of the Africa Continental Free Trade Area;
“Improve basic education financing to improve human capital outcomes;
“Monitor the impact of conflict on the welfare of households to protect poor and vulnerable people;
“Leverage digital technologies to diversify the economy and create jobs for young workers.”