The outgoing year 2021 has witnessed a string of old challenges besetting Nigeria, including the persisting security challenge, while the COVID-19 pandemic continues to take a heavy toll on the most populous African nation.
Despite a volatile security situation, rising food prices, and weak revenue, the West African country looks forward to fostering strategic growth in the coming years with a new national development plan, having made progress in reducing violence in the northeast region in 2021.
In October, while presenting the 2022 fiscal bill, which Nigerian President Muhammadu Buhari described as a “budget of economic growth and stability” to the bicameral legislature, he acknowledged these challenges but said a strategy to deliver on goals and aspirations of the government had been designed in the recently launched National Development Plan (NDP 2021-2025).
According to Buhari, as reflected in the budget proposal, the focus and priorities of the government in the coming years will center around areas including diversifying the economy; investing in critical infrastructure; strengthening security and ensuring good governance; and reducing poverty and minimizing regional, economic and social disparities, among others.
-PERSISTENT SECURITY CHALLENGE–
Nigeria has been inundated by a security situation that is a major issue for the government in the past decades. The year 2021 has also witnessed a series of gunmen attacks across the country, including attacks on schools and kidnappings of students, and attacks on security facilities such as police stations and prisons which resulted in the deaths of security personnel and jailbreaks.
At a recent meeting of the Economic Community of West African States, Buhari said Nigeria continues to face security challenges that pose a threat to democracy, noting the growing instability and violence in parts of the country is alarming while calling on global partners to support Nigeria’s efforts in tackling insurgency and terrorism.
Violence across the northwest region of Nigeria alone has killed over 8,000 people since 2011 and displaced over 200,000 people, according to a report by the International Crisis Group, a Brussels-based transnational non-governmental organization.
However, successes have also been achieved in reducing violence in the country, especially in the fight against the extremists in the northeast region, the stronghold of the notorious Boko Haram and its sister group the Islamic State West Africa Province (ISWAP).
According to reports by local media in June, Abubakar Shekau, the top leader of Boko Haram, was killed in a faction conflict in the northeast region of Nigeria. The Nigerian military also confirmed in October that Abu Musab Al-Barnawi, the leader of the ISWAP, was dead.
At a press briefing mid-December, Minister of Information and Culture Lai Mohammed said there was significant progress in the fight against terrorism, pointing at the recent surrendering in droves of Boko Haram militants, alongside their family members in different parts of the northeastern state of Borno.
However, local observers said the death of leaders of Boko Haram and the ISWAP would not be the end of insurgency in the northeast as there are many extremists still in the bushes while insecurity issues also persist in other parts of the country.
Sheriff Ghali, professor of political science at the University of Abuja, said in a recent interview the government needs to be more aggressive in partnering with the international partners and private sector and individuals in the country to curb the rising insecurity.
Since 2009, the Boko Haram, which later together with the ISWAP, has aimed to establish an Islamist state in northeast Nigeria, and extended their attacks to other countries in the Lake Chad Basin.
-OPTIMISM AMID CHALLENGES-
Local economic experts remain optimistic despite security challenges and the recent surge of COVID-19 infections in the country.
The largest economy in Africa is expected to expand by 2.79 percent in the full year ended 2021, according to recent estimates by a Nigerian financial advisory firm, Afrinvest. That would be a growth increase of almost 5 percentage points from the -1.79 percent GDP growth in 2020 when the impact of COVID-19 lockdown affected economic performance.
Opportunities in coming years, according to local observers, also lie in the country’s investment in the digital economy and infrastructure.
In late October 2021, the country recorded significant innovation in the financial sector when it became the first in Africa and one of the earliest in the world to launch the digital currency, eNaira.
Buhari said at the launch ceremony that the adoption of the country’s central bank digital currency and its underlying technology, called blockchain, can increase Nigeria’s gross domestic product by 29 billion U.S. dollars over the next 10 years.
Local experts said this will bring about innovations and improvements that come with an increased focus on electronic transactions in the country.
Tope Fasua, an economic analyst and former banker, said in a recent interview the adoption of digital currency is “commendable”, adding it is a step in the right direction by Nigeria since it will benefit the economy by saving the huge cost of managing physical cash and including more Nigerians in the financial sector.
On June 10, Nigeria also started the full commercial operation of a China-assisted railway linking the southwestern cities of Lagos and Ibadan, to ease public transportation and goods movement in the country. The project is the first double-track standard-gauge railway to be built in West Africa.
The construction of the 157-km Lagos-Ibadan railway, and an extension of about 7 km to a busy port in Lagos, was described as another milestone in the drive to revitalize the railway system in Nigeria by Buhari.
Buhari said recently that his administration was taking infrastructure expansion in Nigeria seriously, conscious of the fact that new investments in critical sectors of the economy would help lift 100 million Nigerians out of poverty by 2030.
“There is a nexus between infrastructure development and the overall economic development of a nation,” the Nigerian leader said.
The NDP (2021-2025) launched earlier this month also aims to provide for the implementation of major infrastructure and other development projects across the country.
Speaking at a short ceremony to launch the document, Minister of Finance, Budget and National Planning Zainab Ahmed said the government aimed to take necessary actions that will fundamentally change the structure of the economy and how government businesses are conducted for efficiency and effectiveness through the new medium-term development plan.
