Economist urges Buhari to focus on non-oil export | Independent Newspapers Limited
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Business, Maritime

Economist urges Buhari to focus on non-oil export

Posted: Apr 10, 2015 at 2:00 am   /   by   /   comments (0)

An economist and managing director, Corporate Investment Limited, Lagos, Dr Suleiman Yusuf is worried that Nigeria, by contrast, is overly-dependent on oil, which contributes more than 70 per cent of consolidated government revenue.

But he wants the incoming administration of President-elect, Muhammadu Buhari, to pay attention to non-oil export for the survival of the country’s economy.



The country has been finding it difficult to earn foreign exchange from non-oil sectors, as oil price took a plunge in the international market.

“If oil is taken out of the equation, Nigeria’s revenue-to-GDP ratio, normally around 26 per cent of pre-rebased GDP, falls to around six to seven per cent,” said Yusuf, adding that if Nigeria’s GDP is rebased, its non-oil revenue collection ratio which it collects in form of taxes may fall to less than four per cent of GDP, which is lower than most of its regional peers.

He noted that over-dependence on oil revenue, in spite of the declining role of oil in the economy, suggested that government enjoyed autonomy from tax-raising that weakened political accountability.

He said since the beginning of the year, the Naira lost near 12 per cent against the U.S. Dollar, saying that inflation as measured by the consumer price index, reflects the annual percentage change in the cost to the average consumer of goods and services that may be fixed or changed at specified intervals.

According to Yusuf, the inflation rate in Nigeria averaged 12.27 per cent from 1996 until 2015, reaching an all-time high of 47.56 per cent in January 1996 and a record low of 2.49 per cent in January 2000.

He said Nigeria’s annual inflation edged up to eight per cent in December 2014 from 7.9 per cent in the previous month. “Food prices increased for the first time in four months as published in January. Nigerian annual inflation rate eased for the third straight month to 7.9 per cent in November 2014. This is slightly down from 8.1 per cent in October due to lower food prices as published in December 2014.’’

He congratulated the in-coming administration and wished the government a successful administration.