*To leapfrog Germany, UK, France, Others
Nigeria’s economy can be a $6 trillion economy by 2050, thus featuring among the world’s top ten economies, overtaking Europe’s biggest economies, Germany, the United Kingdom and France, among others, according to a the March report by PwC.
The PwC prediction is a tad more optimistic than that of Jim O’Neil, former MD of Goldman Sachs, who predicted at the 20th Nigeria Economic Summit that Nigeria could be in the top 15 by 2050.
The report, ‘Nigeria: Looking Beyond Oil’, reechoed a time worn admonition that Africa’s largest economy needs only to diversify the economy away from its present oil mainstay to ramp efforts in agriculture, petrochemicals and retail, among other attractive sectors.
“We project that the economy could rise through the world rankings to top 10 in 2050 with a projected GDP of US$6.4 trillion, surpassing Germany, the United Kingdom, France and Saudi Arabia”, the report says.
Given the volatile nature of oil prices in the world market, however, the country needs “diversification from the economic over dependence on crude oil is required”, it noted.
“Nigeria’s intrinsic potential lies beyond oil”, the report declares.
“Harnessing this potential has become an imperative given the expectations of lower for longer oil prices.”
The priority sectors, for the rapid growth of Nigeria, the report notes, are agriculture, petrochemical and refining, retail and ICT.
“Our analysis identifies (these sectors) as priority sectors with the most dominant transmission links to the overall economy.
“These sectors in the medium-to-long term are keys to boosting other sectors like manufacturing.”
The report hinted that forward linkages to agroprocessing and other services such as logistics as well as backward integration to input supply sectors could improve farm incomes, increase employment and improve domestic food security.
Painting a picture of where Nigeria can be in 14 years, the PwC report says Nigeria’s global agriculture exports could take-off at a rate similar to Brazil’s, with US$59 billion in export revenues by 2030.
Pontificating, the report says value added to oil and gas output needs to urgently improve by implementing diversification within the sector. “This requires investments across the downstream sector to develop petrochemicals, fertilisers, methanol and refining, industries relevant in both industrial and consumer products which Nigeria currently imports.”
“Consumer spending is the largest driver of the economy, accounting for 70% of GDP and we expect that this will be the boost for the retail sector growth even as population continues to expand. Thus, as incomes rise along with rapid urbanisation, we project that household consumption expenditure could reach US$1.1 trillion by 2030, from US$317 billion in 2014, which implies a growth of 9% through 2030.”
At the 20th Nigeria Economic Summit, Jim O’Neil said that population and productivity drove economic growth over a long term and that Nigeria had already been listed among the expected 15 largest economies by 2050. “What you are seeing today is the list of the 15 largest economies by 2050 and Nigeria is there. This means that Nigeria can be the 15th largest economy by 2050.
“You have one ingredient in a very substantial way; you have a large and young population that is outstanding significantly,” he said.