Nigeria Loses 2% of Expected GDP to Poor Infrastructure Base

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The federal government has said that about two per cent point that should ordinarily accrue to Nigeria’s Gross Domestic Product (GDP) ratio annually is reportedly lost as a result of the country’s poor infrastructure base, notably energy infrastructure.

It stated that given an efficient infrastructure base, Nigeria’s GDP growth could be higher than what it is today and in turn lead to improved employment for Nigerians.

The Minister of Finance and Coordinating Minister of the Economy (CME), Dr. Ngozi Okonjo-Iweala, made this disclosure at the last Nigeria power sector investors conference which was hosted by President Goodluck Jonathan at the banquet hall of the Presidential Villa, Abuja.

Okonjo-Iweala stated that efforts to unlock Nigeria’s economic potentials through reforms in her power and transportation sectors had been initiated by the government, adding that this was expected to yield results in a matter of time.

“I want to talk briefly about the economic environment in which we are operating to situate what the power sector can do before talking about investment opportunities in our country’s power sector.
On the economic environment, our prospects in 2014 may be brighter than 2013 largely on account of some recoveries in advanced economies that are our major trading partners like the US and UK,” she said.

Continuing, the minister stated that: “Nigeria’s economic fundamentals remain strong and I want to assure investors of this; GDP growth remain robust and we still expect growth to be at 6.5 per cent even though we have faced challenges of inequality and exclusion, this strong growth is sustained by the non-oil sector which recorded 7.9 per cent growth in the last quarter of last year with strong performance from agriculture, solid minerals, housing and construction, telecommunications, wholesale and retail trade.
Projections for our economic growth by IMF in 2014 are substantially higher at 7.4 per cent which is one of the fastest growth rates in the world this year and it is above our own projection of 6.7 per cent growth in 2013.

Inflation has remained at single digit wit 8 per cent as at December 2013.”
“This is a way of telling you that Nigeria is positioned as a country to reckon with; this conference gives you the unique opportunity to be here in Nigeria as I always say that if you are not in Nigeria, you are not in Africa.

Regardless of our current economic performance, our economy will not reach its full economic potentials if we do not embrace the significant gap in our infrastructure particularly our power and transportation infrastructure. According to a joint World Bank and Africa Development Bank studies, we are losing about two percentage point of GDP each year as a result of our infrastructure deficit,” she added.

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