Article Summary
- During his inauguration soeech, President Bola Tinubu said that the government will target higher GDP growth and significantly reduce unemployment.
- Reacting to this, financial experts said the new president needs to first improve on investment in the economy to enable him to achieve higher Gross Domestic Product (GDP) growth.
- The experts also said that ease of doing business, addressing multiple taxations, and broadening the tax net are crucial for economic growth and revenue enhancement.
Some financial experts have called on President Bola Tinubu to improve on investment in the economy to enable him to achieve higher Gross Domestic Product (GDP) growth.
The financial experts stated this while reacting to Bola Ahmed Tinubu’s inauguration speech, in which he stated that his target was to increase the growth of Nigeria’s Gross Domestic Product.
What the experts said
Professor Ken Ife, a financial expert and Member of the Governing Council, Ministry of Finance Inc. (MOFI), described the president’s target of 6% GDP growth as necessary and realistic. He urged him to improve on investment in the economy to achieve that.
Speaking further, he said that the president’s plan to work toward a unified exchange was a good objective move. He, however, noted that the unified exchange rate could not be achieved in a hurry because of the price mechanism of demand and supply.
Overall, he described President Bola Tinubu’s inaugural speech as conciliatory and filled with lots of hope. According to him, the president’s speech showed his readiness and willingness to end any disagreement that might have arisen from the just concluded elections that brought him to power.
He added that Tinubu was full of promises of where we are heading and he showed firm resolve and courage in saying the subsidy has ended.
- “I see a lot of hope in the President’s speech. What I like in his speech is the conciliatory tone; which is very important and then recognising that the battle is over, that is, from a political perspective.
- “But more details will come out on what kind of palliatives and directions he is going to go,” he said.
On his part, the Chief Executive Officer of BIC Consultancy Services, Dr Boniface Chizea, said that Tinubu’s target of 6% GDP growth would be of benefit to the economy, only if he could actualise it.
- “6% GDP growth is good for the economy if he can achieve it. That is wonderful and it will bring improvement to the quality of life of the people. We want the economy to grow more than the rate of our population growth; the rate of our population growth in Nigeria is about 2.41%,’’ he said.
On Tinubu’s plan to review complaints about multiple taxation and exchange rates unification, Chizea said:
- “All these are not new, what we have to concentrate on overall is ease of doing business. But multiple taxations is what also affects companies leaving Nigeria for Ghana and other countries because companies don’t want to be taxed here and there. But we should subsume that under ease of doing business.
- “And Ease of doing business will see us have access to roads, customs, security, the sanctity of contracts, and the legal system, among others.
- “It’s a good thing to do, but the thing we must know is that we have challenges with revenue, so we need to find a way to enhance our revenue.
- “Our tax revenue to GDP is one of the lowest. So, the government has to find a way to address that, maybe not increase tax but to broaden the tax net to bring in more people.”
In case you missed it
President Tinubu had said that the new government targets higher GDP growth and significantly reduces unemployment. He said:
- “We intend to accomplish this by taking the following steps: First, budgetary reform stimulating the economy without engendering inflation will be instituted. Second, industrial policy will utilize the full range of fiscal measures to promote domestic manufacturing and lessen import dependency.
- “Third, electricity will become more accessible and affordable to businesses and homes alike. Power generation should nearly double and transmission and distribution networks improved. We will encourage states to develop local sources as well.
- “I have a message for our investors, local and foreign: our government shall review all their complaints about multiple taxations and various anti-investment inhibitions. We shall ensure that investors and foreign businesses repatriate their hard-earned dividends and profits home.”
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