‘Value-addition will boost Nigeria’s GDP growth’
Applying the diversification model of some developed countries as well as, increased investment in manufacturing can aid the growth of the nation’s Gross Domestic Product (GDP) and help it reclaim its position as Africa’s largest economy, stakeholders have said.
Speaking at the 32nd Omolayole management series lectures, tagged “Made-in-Nigeria: Vehicle to the diversification of the economy”, the stakeholders emphasised the need to make manufacturing a driver of the economy.
Indeed, from a Gross Domestic Product (GDP) value of $510 billion to an assessed $296 billion due to weakened naira, Nigerian economy is believed to have contracted by about 42 per cent compared to the South African economy that contracted from the assessed $370 billion to $310 billion.
With Nigeria slipping into recession, South Africa regained the position more than two years after losing it to Nigeria as the value of the nations’ currencies moved in opposite directions.
Acting Managing Director, Bank of Industry (BoI), Waheed Olagunju stated that, all that is required to grow the nation’s GDP, is to replicate development strategies of developed economies around the world.
Olagunju explained that is no rocket science to grow Nigeria’s GDP to a tune of about $2.4 trillion if priorities are placed towards developing the nation’s industrial and agricultural sectors.
Olagunju said the manufacturing sector’s contribution to GDP must hit double digit figures, maintaining that in Least Development Countries (LDCs) such as Kenya, 18 per cent of its GDP is accounted for by its industrial sector while Nigeria’s real sector contribution to the GDP has remained low at single digit.
“Manufacturing must account for double digit of our GDP. If this happens, it is the beginning of progress and this means that we must add value to our natural resource endowments. If we do this and are able to achieve a double digit GDP, we can achieve an industry capacity utilisation above 70 per cent.
“What is clear is that we need to industrialise Nigeria aggressively, because industrialisation is what makes the difference between the rich and poor countries of the world. It is not by accident that the rich countries are referred to as industrialised countries”, he added.
According to a report he attributed to Oxfam, industrialised countries of the northern hemisphere bought cocoa worth a billion dollars from Nigeria, Ivory Coast, Cameroun and Ghana, investing another $3 billion on value addition which generated businesses worth about $60 billion.