By Kolawole Ojebisi
The African Development Bank has highlighted ways by which Nigeria can achieve long-term growth and become a trillion-dollar economy.
AfDB stated that Nigeria must harness its financial, human, and natural resources more effectively, stressing that this is only achievable through better governance, investment and planning.
This is contained in a statement by the AfDB on Saturday, revealing the crux of the 2025 Nigeria Country Focus Report, unveiled on Thursday in Abuja titled, “Making Nigeria’s Capital Work Better for Its Development.”
“Nigeria’s capital, its money, its people, and its natural resources can and must work harder and smarter for national development. This report offers a roadmap to unlock that potential through fiscal reforms, governance improvements, and innovative financing.” AfDB’s Country Manager for Nigeria, Lamin Barrow, said while speaking at the report unveiling.
The CFR report, however, lamented the country’s management of its human capital, stressing that Nigeria scores just 36 per cent on the Human Capital Index, a performance it added it’s well below the Sub-Saharan average.
“Underinvestment in health and education is limiting productivity.
“Current public spending 7.9 per cent for education and 5.3 per cent for health is too low for a country with a young and rapidly growing population,” Barrow added.
Also cited as a major constraint on development financing is Nigeria’s tax-to-GDP ratio of 13 person cent, which according to the report is one of the lowest in West Africa.
“Despite recent reforms, revenue mobilisation is hindered by a large informal sector, weak compliance, and institutional inefficiencies,” the report noted.
Suggesting a way forward, the AfDB recommended expanding the tax base, improving compliance, and addressing fiscal leakages to strengthen public investment in health, education, and infrastructure.
Chief Economist, Kevin Urama, said, “Fragmented oversight and governance gaps have eroded public trust and discouraged investment.
“Institutional reform and rule of law are non-negotiable if Nigeria is to unlock sustainable financing.”
Despite the economic challenges besetting the country informed by bold reforms such as fuel subsidy removal, exchange rate unification, and tax policy shifts CFR insisted that Nigeria was at a turning point.
“With the right policies and strong implementation, Nigeria can not only close its financing gap but build a more resilient, inclusive, and sustainable economy,” said Urama.
The report noted that Nigeria could chart a course towards economic prosperity through investments in green finance, sustainable agriculture, and the emerging carbon market, estimated to yield up to $2 billion in potential revenue.
“Blended finance, diaspora bonds, and fintech are helping to bridge the gap,” the CFR stated.
