The World Bank's Global Development Prospect report for June 2023 has maintained Nigeria's projected growth rate 2023 at 2.8 percent. According to the report, this growth will primarily be driven by the non-oil sector as the oil sector grapples with structural challenges, resulting in output levels below the assigned quota by OPEC. Foreign exchange shortages, exchange rate volatility, security challenges, rising living costs, and limited fiscal capacity are anticipated to impede growth.

Dozens of studies point to evidence of significant reductions in carbon emissions driven by climate agreements, such as the Paris climate agreement. However, these studies fail to answer a pertinent question, that is, are global carbon emission reductions due to reduced production activities or are production processes becoming more efficient as less carbon is emitted per unit output due to technical progress? Such an understanding is important to evaluate the tension between environmental quality and economic growth. 

This journal was first published on Science Direct by David Iheke Okorie and Presley K. Wesseh Jr

Read More

In its first administrative steps, the new government of the federation has declared the removal of the country’s controversial subsidy on fuel. Welfare advocates have defended it, but it has also come under heavy fire for its macroeconomic and budgetary lapses. For instance, subsidy costs, which totalled over N10 trillion between 2006 and 2019, consumed N4.39 trillion ($9.7 billion) in 2022 alone and nearly N3.36 trillion ($7.5 billion) in the first half of 2023, have been a contributing factor in budget deficits in recent years.

This study examines the effect of ICT on tax revenue mobilisation in 23 sub-Saharan African countries between 2000 and 2020. To address our objectives, it utilises a feasible generalised least squares approach that accounts for both heteroscedasticity and autocorrelation challenges. Particularly, six measures of ICT (import of ICT goods, export of ICT goods, ICT trade, internet penetration, mobile phone penetration, and aggregate ICT index) and six tax measures (total tax, direct tax, indirect tax, taxes on income, profit, and capital gains, taxes on goods and services, and taxes on international trade) are explored in the study.

This article was first published by the Development Bank of Nigeria (DBN) Journal of Economics and Sustainable Growth.

Read More

Young people under the age of 30 account for nearly 70 percent of the population of Africa, making it the world's youngest continent (United Nations 2021). While this trend provides exciting opportunities for enhancing creativity and innovation, it comes with a high burden, as the formal education system and apprenticeship programs cannot adequately prepare a large number of young people for the future of work. As a result, the continent may have a large share of youths without high quality jobs for their desired quality of life. The future remains bleak as projections show that the number of youths in Africa will increase by 42 percent by 2030 (United Nations, 2015), further indicating the need to close the youth skills gap on the continent in order to actualize improved employment.

Nigeria is Africa’s most populous country with over 200 million people and has the largest labor force in the continent (Macrotrends 2022; Global Business Service 2021). The most recent national labor force population survey shows that over 69.7 million Nigerians are within the working age group and are willing to work (NBS 2020a). Out of the 69.7 million people, over 42 percent of young people (aged 15-34 years) are unemployed (NBS 2020a). In this regard, Nigerians are found in the web of the informal economy, self-employment, and underemployment, which leaves many Nigerians, mostly youths, to experience vulnerable employment, poor working conditions, and high poverty (World Bank 2015). Indeed, in 2020, about a third of the youths (28.2 percent) were underemployed (NBS 2020a). Put together, Nigeria will need to deliver a large number of quality jobs for youths.

The manufacturing sector, which was long assumed to play a central role in generating considerable employment in Nigeria, has remained relatively stagnant over the years (Itaman and Awopegba 2021). Recent estimates show that the manufacturing sector accounts for less than 10 percent of the national gross domestic product (GDP), and as a result, it employs only a small cohort of the labor force (World Bank 2022a). Accordingly, the contribution of the manufacturing sector to formal sector employment has remained stagnant, averaging 11.4 percent between 2011 and 2021 (World Bank 2022a). The situation
is further worsened by minimal employment opportunities in the public sector (World Bank 2015). A considerable share of young Nigerians who graduate each year with a degree, certificate, or diploma seem to prefer working with the government due to the perceived job security; however, public sector jobs have been in short supply over the past two decades (World Bank 2015). On the other hand, the private sector, which has been active in creating jobs, has been unable to adequately absorb the large number of people entering the labormarket (World Bank 2019b)

Read more

In Nigeria, women’s labour participation has begun to pick up in recent years after many years of stagnation. However, women's entry point into labour has been mainly through the informal sector or at the bottom pyramid of the formal labour market. Promoting women's inclusion in the top echelon of the labour market remains a knotty policy issue. This has become more important with the Nigerian government increasing priority around MSMEs as a tool for poverty alleviation and economic development.

The Nigerian economy grew by 2.31 percent in the first quarter of 2023, according to a report by the National Bureau of Statistics (NBS) released in May 2023. However, compared to the fourth quarter's GDP growth, which was 3.52 percent, this represents a fall of 1.21 percentage points. Compared to the first quarter's economic growth of 3.11 percent the year before, GDP growth decreased by 0.80 percentage points annually.

Nigeria produced a total of 999,000 barrels per day (bpd) in the month of April 2023, according to the latest monthly oil market report of the Organization of Petroleum Exporting Countries (OPEC). This output, however, indicates a decline of 270,000bpd from the 1.27 million bpd produced in the month of March; it also represents the third successive decline in monthly oil production since February 2023 and the fourth production slump in the five months leading from December 2022. Consequently, Nigeria has once again lost its place as Africa’s highest crude oil producer, falling behind Angola, which produced a total of 1.06 million bpd in the period under review after improving by 91,000bpd from 972,000bpd in March 2023.

The COVID-19 pandemic has given rise to arguably the most challenging global health crisis in modern times. Its impact has been felt by most sectors of the global economy, resulting in economic decline around the world. Governments have committed at least $12 trillion towards a recovery stimulus with a focus on immediate needs, including healthcare, job security and food security. However, studies show that the economic response to the COVID-19 crisis has also reinforced negative environmental trends, as few governments have used COVID-19 stimulus packages to transform the economic trajectory of their countries in a way that responds positively to climate change and enhances environmental sustainability. This despite the fact that climate change is one of the biggest threats facing humanity today. With properly designed stimulus packages that are climate friendly, countries can build back in a way that is more sustainable, resilient and inclusive.

Read more

This article was first published by SAIIA