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Gbajabiamila, others chart path to economic growth

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Participants in the Africa Initiative for underscored the need for the government to leverage the opportunity presented by the coronavirus pandemic and diversify the economy, and spend wisely.

AIG, a not-for-profit founded to inspire the transformation of Africa’s public sector, in collaboration with the Blavatnik School of Government, University of Oxford, hosted the virtual discussion themed: ‘COVID-19 and the Oil Price Crash: Nigeria’s Tough Choices”.

The stakeholders argued that the time was ripe for the country to focus on encouraging growth in the informal sector to boost the economy.

They pointed out that COVID-19 brought about many changes to the fabric of every society, restricting business activities and causing loss of lives across the world.

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According to them, the country is faced with a double-edged crisis comprising COVID-19 on the one hand and the instability in oil prices on the other.

The participants argued that the fluctuation in oil prices had been costly because the 2020 budget was based on forecasted price of $57/bl. The situation has compelled the government to revise this to $20/bl while maintaining proposed production volume at 2.18m bl/d.

The House of Representatives Speaker, Femi Gbajabiamila, who noted that it was indeed a tough time for the country, challenged the notion of a developing country, saying: “If we harness our resources well, Nigeria should be a developed country, not a developing nation.”

He said that the falling oil prices posed an opportunity for Nigeria to finally advance the diversification of her economy.

A professor of Economics and Public Policy at the Blavatnik School of Government, University of Oxford, Paul Collier stated that the COVID-19 had impacted negatively on the nation’s economy with a fall in government revenue and people’s capacity to spend.

Collier, who suggested that the government should focus on encouraging growth in the informal sector to boost the economy, described the sector is a major contributor to the Nigerian economy, accounting for a significant portion of employment and national Gross Domestic Product (GDP).

‘Due to its flexible nature, the informal sector in some ways is better able to adapt to difficulties such as the current pandemic, providing some measure of support to those most in need.”

The Founder and Chairman of AIG, Aigboje AigImoukhuede, in his opening address, argued that while governments had so far committed $15.6 trillion in responding to COVID-19, an average of $2,042.00 per person, Nigeria’s $6.5 billion in commitments amount to a paltry $32.50 per person.

“COVID-19 has brought an opportunity for Nigeria to rethink and reinvent the way we lead our people so that we can spend smartly, generate more revenue and also get the citizens to act in a manner that will deal with this pandemic and other health issues”.

He suggested that the private sector should collaborate more with the government.

The Vice President for Equitable Growth, Finance and Institutions (EFI) at the World Bank, Dr. Ceyla Pazarbasiogu recommended implementation of policies to boost the economy and improve governance.

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