External/foreign reserves depleted by 0.6% to $40.7 billon for the week in review from $41.04 billion, the lowest since January 2018.³ The reserve has steadily plunged since the last week of July, losing about $5 billion in the last 4 months. The depletion in external reserve is attributable to the Central Bank of Nigeria (CBN) intervention in the foreign exchange market to prevent depression arising from capital flight.⁴  This capital flight has been largely driven by rising uncertainties in the Nigerian economy, in addition to lower but expected increase in the United States’ interest rate. While the monetary authorities have maintained foreign exchange stability at the expense of foreign reserves, there is need for fiscal authorities to supplement efforts to sustain reserves. Social, economic and political uncertainties –arising from the recent border closure for instance – are disincentives to investment that should be tackled to boost investors' confidence and shore up external reserves.

Consumer prices for the month of September 2019 increased by 0.22 percentage points. Specifically, inflation rate increased from 11.02 percent in August to 11.24 percent in September 2019.¹ The rise in inflation rate is attributed to an increase in both core and food components which rose by 0.34 percent and 0.26 percent respectively. The Inflation Attitudes Survey conducted by the Central Bank of Nigeria in 2019 Q3 suggests that 52.9 percent of respondents believe that the economy would end up weaker if prices rise faster than they do now.² Respondents also indicated that they will prefer higher interest rates to higher consumer prices. This continuous rise in the prices of goods and services leaves households and firms with less disposable income and profit respectively. Going forward, we expect demand-pull inflation to rise stemming from the soon-to-be implemented minimum wage, and cost-push inflation emanating from increase in energy and food prices as we approach the festive season.

Internally Generated Revenue (IGR) for the 36 states and the Federal Capital Territory (FCT) increased by 15.78 percent in the first half of 2019 relative to the second half of 2018. IGR increased from ₦596.91 to ₦691.11 billion in the review period.¹ Income tax (62.45 percent) was the major source of revenue for the states. Other sources of internal revenue for the states include road tax, revenue from MDAs, direct assessment, and other forms of taxes. Further disaggregated data shows Lagos state generated the most revenue, accounting for 29.6 percent of the total internal revenue generated. Rivers, FCT, Delta, Ogun, Kaduna and Akwa Ibom generated over ₦20 billion each in the first six months of 2019. Gombe, Yobe, Taraba and Borno – all north eastern states – generated the least (less than ₦4 billion each) in the review period. In as much as states intend to increase the level of IGR generated, careful consideration should be made with regards to taxing households and firms in order not to undermine productivity and in turn, economic growth. Other sources of revenues from ‘state-owned’ enterprises such as recreational centres and real estates can be explored. Particularly, revenues from tourism can be strengthened.

Education is acknowledged largely as a significant tool because it equips students with the functional skills for decent living and generates human capital that can spur economic development. Education has many levels, each of which is essential in its distinctiveness and therefore requires adequate public investment.In Nigeria, government’s policy design and investment focuses mainly on three levels: primary, secondary and tertiary education. In fact, it is not far-fetched to assume that most Nigerians think these are the only levels of education. Government policy, in part, feeds into this narrative with the division of the education system into structures like 6-5-2-3 or more recently 6-3-3-4, in which only primary, secondary and tertiary education are emphasized.

However, there is a fourth level of education—the Early Childhood Education (ECE) which starts from birth through the pre-school, until the child enters the primary level of education. ECE was officially recognized in Nigeria in the 2013 National Policy on Education, with the introduction of 1-6-3-3-4 system. The additional one year covers ECE and was designed to be free and compulsory, thereby extending basic education from 9 to 10 years. According to National Policy of Education (2013), the goal of the ECE is to facilitate transition from home to school and prepare children for primary level of education. This belated recognition of ECE has not raised its status in any significant way. As shown in Figure 1a, among the pupils enrolled in Primary 1 to Junior Secondary School in 2015, only 45% have attended pre-school. It is also telling that the pattern of pre-school attendance reflects the typical dimension of exclusion in education in Nigeria. Specifically, about 75% of those that have not attended pre-school are from rural areas, while non-attendance is highest among children from the poorest households (Figure 1b). Overall, this data suggests that the majority of children transit directly from home into primary school. While home and family education is an important component of ECE, attending pre-school could ensure seamless transition to primary education.

The share of Africa’s youth in the world is expected to increase to a staggering 42 percent by 2030 and is projected to continue to grow throughout the remainder of the 21st century, more than doubling from current levels by 2055. Data on direct conflict casualties suggests that more than 90 percent of all deaths occur among young adult males. Today, some 50 percent of the 1.4 billion people living in countries impacted by crises and fragility are under the age of 20. The Security Council has recognized that an estimated 408 million youth (ages 15-29) reside in settings affected by armed conflict or organized violence whereby 1 out of 4 youth globally are affected by armed conflict. These figures are gut-wrenching but indispensable for our understanding of peacebuilding in today’s age. With a global population of over 1.8 billion, young people— though disproportionally affected by armed conflict and organized violence—could potentially employ the unique capacity and ability to take on our planet’s most deep routed conflicts. Their inclusion and leadership are therefore imperative to the successful pursuit of peacebuilding.