Nigeria’s economy is facing stagnation, particularly in key sectors that could drive significant growth, according to a leading economist.
Professor Bongo Adi, an expert in Economics and Data Analytics at the Lagos Business School, Pan-Atlantic University, has expressed concern over the sluggish performance of crucial industries. Speaking at the FATE Foundation’s 10th Business Outlook and Annual General Meeting, he stated that while the economy has shown some resilience, it continues to struggle due to weak performance in its foundational sectors.
Key Sectors Holding Back Economic Growth
Adi noted that while Nigeria’s economy has maintained a level of stability, its real sector is being dragged down by underperforming industries.
“The economy has managed to maintain some resilience to growth, but the nominal sectors are holding back the real sector. This is not a good sign for long-term stability,” he said.
He highlighted three key industries—banking, oil and gas, and telecommunications—as the primary drivers of output in 2024. However, he emphasized that these sectors contribute very little to employment generation, limiting their impact on overall economic growth.
“These three sectors have no significant employment capability. How many jobs do they create? Their contribution to job growth is minimal,” Adi explained.
Over Two-Thirds of the Economy Not Growing
The economist further revealed that 68% of Nigeria’s economy is either stagnant or in decline, leaving only 32% contributing to growth. He stressed that for a true economic turnaround, at least half of the economy needs to record significant positive growth.
“For the economy to truly recover, we need at least 50% of our sectors to experience substantial growth,” he urged.
Call for Export-Oriented Industrialization
To address these economic challenges, Adi recommended a shift towards export-oriented industrialization, urging Nigerian entrepreneurs to focus on integrating into the global value chain.
He emphasized the importance of increasing local production to reduce reliance on imports. According to him, Nigerians heavily consume foreign products, including electronics, air conditioners, and mobile phones from countries like China, Japan, and Korea.
“We must start producing components of the products we consume instead of depending entirely on imports,” he advised.
The Way Forward: Strengthening Local Industries
Adi suggested that Nigeria could strengthen its economy by investing in manufacturing, agriculture, and technology, sectors that have the potential to create large-scale employment opportunities and drive sustainable growth.
Experts believe that policies focusing on industrialization, infrastructure development, and ease of doing business will be key to reversing economic stagnation.
As Nigeria moves towards 2025, economic experts stress the need for structural reforms to stimulate growth in sectors with high employment potential. If the country fails to address these challenges, economic stagnation may persist, impacting millions of Nigerians.
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