The growth projection of Nigeria could lift to 6-7 per cent in the coming decade on the plank of growth-friendly policies by successive governments in the country.
This is one of the key findings from a report from PricewaterhouseCoopers( PwC) economists on The World in 2050: Will the Shift in Global Economic Power Continue?
The report presents long-term projections of potential Gross domestic Product (GDP) growth up to 2050 for 32 of the largest economies in the world, covering 84% of total global GDP. Indeed, Nigeria, Vietnam and the Philippines are notable risers in the global GDP rankings in the long term, reflecting relatively high projected average growth rates of around 4.5-5.5% per annum over the period to 2050.
Andrew S. Nevin, PwC Nigeria’s Chief Economist and co-author of the report, comments: “According to our long term projections, Nigeria could sustain average growth of around 5-6% per annum in the long run, following projected growth of around 6-7% in the rest of this decade, assuming broadly growth-friendly policies are pursued. While foreign investment has in absolute terms long been focused on the oil sector, portfolios are becoming increasingly diversified, moving towards the power, agriculture and mining areas of the economy that have demonstrated a comparative advantage in emerging markets vis-à-vis the West.”
The report also stated that emerging economies of Nigeria, Indonesia and Mexico could push the UK and France out of the top ten economies of the world by 2050 provided they are able to build their institutions to global standards, diversify their economies and sustain growth friendly policies.
Nevin said: “Over the past decade, Nigeria has boasted superior economic growth and, with the right reforms and investments, Nigeria could become one of the world’s leading economies by 2030, with further progress by 2050. Nigeria’s potential advantages for future growth include a large consumer market, a strategic geographic location, and a young and highly entrepreneurial population.”
The report also contains projections based on GDP at market exchange rates, without this relative price adjustment. On that basis, China is projected to overtake the US in around 2028, while India would clearly be the third largest economy in the world in 2050, but still some way behind the US.
Over-dependence on natural resources could also impede long-term growth in countries such as Nigeria, Russia, and Saudi Arabia unless they can diversify their economies over time. “In short, while our analysis confirms that emerging markets have huge potential, they can also be an institutional minefield – both managers and investors need to tread carefully.
Overall, Nigeria continues to be an attractive place to invest not because it is an oil producer, but because of the immense size of its domestic market and the extraordinary commercial energy of its people, which remains largely untapped.”