This is the state of Nigeria today and one that calls for the fierce urgency of now. Across core metrics, we are becoming poorer. It is very important to note that the declining revenue is not because the Nigerian population is shrinking. Rather, what is happening is that most productive sectors are leaving the tarmac even as we are scaling bureaucracy. The fact is this: population is rising but economic opportunities are massively shrinking.
People make the case that we cannot compare today with the past since the exchange rate with US dollars is a moving target. Yet, even if you are to use today’s exchange rate for 2011, Nigeria would have still made close to double the revenue.
The trillions of Naira which gave $55.5 billion at N165/$ , if you use N380/$, would deliver at least twice of 2020 revenue. You may blame Covid-19 for 2020 paralysis, but check 2019, the difference is very marginal.
So, there is a problem – and I want the government to understand that point. We are using debt to cover the revenue shortfall without addressing the root cause which is evident: productivity has dropped. Mr. President, look at data; what we are doing today is not working! We need a new strategy, urgently!
All data on my table is from a speech given by a former governor of the Central Bank of Nigeria (CBN) , Sanusi Lamido
“If you go through the CBN statistical bulletin, in 2011, the total federally collected revenue from all sectors was 18.9 trillion Naira at 165 Naira to the dollar. This will have placed federally collected revenue in 2011 at $55.5 billion. Meanwhile, debt at that time was 5 billion so we had an external debt to external revenue of about 8 per cent in 2011.
“By 2020 we have an external debt of about $33.4 billion but all revenues in 2020 were about $8.3 billion. So it has moved from 8 per cent to 400 per cent between 2011 and 2020.”
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