Nigeria, the most populous country in Africa, is on track to become the world’s fifth-largest economy by 2075, according to a new report by Goldman Sachs. The report, titled “Africa’s Turn: The Path to Prosperity”, analyzes the economic prospects of 11 African countries, including Nigeria, and projects their growth trajectories based on various factors such as demographics, governance, infrastructure, natural resources, and human capital forecasts that Nigeria will overtake Germany, Japan, Brazil and Indonesia in terms of GDP by the end of the century.
According to the report, Nigeria’s gross domestic product (GDP) is expected to grow at an average annual rate of 6.2% from 2020 to 2075, reaching $15.3 trillion by the end of the period. This would make Nigeria the fifth-largest economy in the world, behind China, India, the United States, and Indonesia. Nigeria’s GDP per capita is also projected to increase from $2,229 in 2020 to $29,652 in 2075, surpassing the current levels of countries such as Brazil, Russia, and Turkey.
The report attributes Nigeria’s impressive growth potential to its large and young population, which is estimated to reach 733 million by 2075, making it the third-most populous country in the world after India and China. Nigeria has a population of over 200 million people, with a median age of 18.4 years, making it one of the youngest and fastest-growing markets in the world.
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Nigeria is also the largest oil producer in Africa and the sixth largest in the world, with proven reserves of 37 billion barrels. Moreover, Nigeria has been investing heavily in its power, transport, and digital sectors, as well as in its human capital development and anti-corruption efforts. Nigeria’s economy is also becoming more resilient and diversified, with services accounting for over 50% of GDP and agriculture for over 20%.
The report also highlights the opportunities and challenges that Nigeria faces in achieving its economic potential. The opportunities include expanding its domestic market, increasing its regional and global integration, leveraging its diaspora network, and fostering innovation and entrepreneurship. The challenges include managing its fiscal and external balances, addressing its security and environmental issues, improving its business environment and regulatory framework, and enhancing its social inclusion and cohesion.
The report also highlights Nigeria’s abundant natural resources, especially oil and gas, which account for about 10% of its GDP and 90% of its exports. Moreover, the report notes that Nigeria has made significant progress in improving its governance and institutional quality, as well as investing in infrastructure and human capital development.
However, the report also warns that Nigeria faces several challenges that could derail its growth prospects if not addressed effectively. These include security issues such as terrorism, insurgency, and communal violence; environmental issues such as climate change, desertification, and pollution; social issues such as poverty, inequality, and unemployment; and economic issues such as fiscal deficits, debt sustainability, and exchange rate volatility. The report urges Nigeria to implement sound macroeconomic policies, diversify its economy away from oil dependence, enhance its business environment and competitiveness, and foster regional integration and cooperation.
The report concludes that Nigeria has a unique opportunity to leverage its strengths and overcome its challenges to achieve its full potential as a global economic powerhouse. It states that “Nigeria’s success will not only benefit its own citizens but also have positive spillover effects for the rest of Africa and the world”.