Renown economist and Managing Director of Financial Derivatives Company, Bismarck Rewane has expressed skepticism about the current administration’s goal of achieving a $1 trillion economy within the next five to six years.
Speaking on Arise TV’s morning show, Rewane discussed the recently approved windfall tax and the GDP figures for the second quarter of 2024.
Rewane pointed out that the current GDP growth rate of 3.19% is insufficient to drive significant economic progress, noting that around 75% of the country’s economic sectors contracted during the quarter.
He also highlighted that the nation has fallen behind in its objective of becoming one of the top 20 global economies, making the $1 trillion target increasingly unattainable.
Secondly, we now said that we want the economy to be a $1 trillion economy but now we are $384 billion that means we have to have like 200% growth in the next 4 to 5years that is not going to happen.”
“We also said we want to insulate our economy from external shocks but as we integrate our economy into the global economy, we are facing those shocks.”
Rewane argued that this focus contradicts the investment-led growth strategy promoted by the current administration, which aims to expand Nigeria’s economy to $1 trillion in the next three years.
He pointed out that many Nigerians lack motivation to pay taxes, as they don’t perceive any tangible benefits from the taxes they’ve already paid.
He noted that while Nigeria’s tax-to-GDP ratio has increased from 4% to 9%, there has been no corresponding improvement in the well-being of the population.
He further highlighted the challenges facing Nigerian companies, which reported N1.4 trillion in foreign exchange revaluation gains but also suffered N1.7 trillion in forex losses during the same period, resulting in a net economic loss of N300 billion.
Rewane’s comments come in contrast to President Tinubu’s optimistic projection during the 2023 Nigeria Economic Summit, where he stated that a $1 trillion economy could be achieved within three years, with a long-term goal of reaching $3 trillion by 2030.
