Economic Challenges and Opportunities in Nigeria
Chairman of the Nigerian Economic Summit Group (NESG), Niyi Yusuf, has highlighted that while Nigeria has made some economic gains, the country’s foreign direct investment (FDI) efforts remain weak. This statement was made during his opening remarks at the ongoing Nigerian Economic Summit in Abuja, which had the theme: ‘The Reform Imperative: Building a Prosperous and Inclusive Nigeria by 2030.’
Yusuf emphasized that for Nigeria to attract sustainable capital inflows, it must demonstrate openness, fairness, and predictability. He pointed out that how the country treats its domestic investors will send signals to foreign investors about the credibility and stability of the business environment.
He stressed that policy predictability, investment protection, and transparent mechanisms for resolving business disputes are critical to rebuilding trust in the economy. According to Yusuf, the way Nigeria handles domestic investors is a key indicator for foreign investors assessing the country’s business environment.
Fiscal Condition and Investor Sentiment
Despite improvements in Nigeria’s fiscal condition, the economy continues to face persistent inflationary pressures, high debt-service obligations, and subdued investor sentiment. Yusuf noted that while the fiscal situation has improved, expectation pressures persist, and the fiscal debt remains at N15.5 trillion in 2024. The debt-to-GDP ratio of 40.6 per cent remains stable, but the debt-to-service ratio is high. Foreign capital is close to the boundary, yet FDI remains weak.
Yusuf reminded participants that policy credibility, incentives, and social competitiveness are essential to attracting long-term capital from both domestic and foreign investors. He described Nigeria’s economic story as one of transition, marked by undeniable progress amid sustained fragility.
According to him, the NESG’s last three macroeconomic outlook reports have outlined a roadmap for economic transformation built around three key phases: stabilisation, consolidation, and acceleration.
Reforms and Investor Confidence
The NESG chairman’s comments come after the Central Bank governor, Olayemi Cardoso, disclosed that Nigeria’s reforms are reigniting investor confidence. Speaking at a lecture in Lagos on the theme ‘Next Generation Leadership in Monetary Policy and Nation Building,’ Cardoso noted that clearing the inherited forex backlog was a decisive move that restored credibility and signalled to markets that the Bank was serious about reforms.
Cardoso stated that trust in Nigeria’s financial system has grown stronger because promises were kept. He added that if people expect to continue to trust and invest in the economy, they must keep their promises. This action contributed significantly to the rise in foreign exchange reserves.
Reflecting on progress since his assumption of office, Cardoso stressed that consistent policies and firm commitment to the CBN’s mandate have placed Nigeria on a stronger footing. He said that consistent messaging, consistent policies, and doing all the right things have taken the country to a good place.
According to Cardoso, the evidence of renewed confidence is clear in reports by international rating agencies, multilateral institutions such as the World Bank, and feedback from global banks. He pointed out that top investment firms which had previously stayed on the sidelines are now revisiting Nigeria with keen interest.
Job Creation and Economic Transformation
Meanwhile, the NESG has warned that Nigeria must create at least 27 million new formal jobs by 2030-equivalent to 4.5 million jobs annually, to prevent unemployment from worsening as the nation’s working-age population expands to 168 million within the decade.
The Group stated this in a new report titled ‘From Hustle to Decent Work: Unlocking Jobs and Productivity for Economic Transformation in Nigeria,’ launched at the ongoing 31st Nigerian Economic Summit (NES #31) in Abuja on Monday.
The report calls for an urgent and coordinated national response to tackle unemployment, raise productivity, and drive economic transformation. It warns that without decisive action, unemployment and underemployment could double by the end of the decade, trapping millions of Nigerians in low-skilled, low-paying, and vulnerable work.
According to the NESG, the future of Nigeria’s workforce depends on how quickly the country can move from a ‘hustle economy’ dominated by informal activities to one that delivers decent and productive employment.
Addressing Informal Employment
Presenting the report, Dr. Wilson Erumebor, Senior Economist at the NESG, said the jobs crisis in Nigeria has gone beyond the question of employment numbers and now represents a fundamental development challenge. He emphasized that without decisive reforms to create decent and productive jobs, an entire generation risks being trapped in vulnerable work that neither lifts families out of poverty nor moves the nation forward.
Erumebor noted that the structure of Nigeria’s economy has created a situation where the vast majority of citizens depend on informal, insecure work to survive. He pointed out that the weak private sector capacity and reliance on the government for wage employment in some states have left millions of Nigerians with the option of finding work in the informal economy.
Informal jobs, often characterised by low pay, limited security, and minimal productivity, accounted for 92.2 percent of total employment in 2023 and rose to 93 per cent in the second quarter of 2024. He described this trend as alarming, adding that it reflects ‘the limited private and public investment in sectors that can deliver quality jobs at scale.’
Pathways to Economic Growth
To tackle these challenges, the report introduced the Nigeria Works Framework, a blueprint designed to reposition Nigeria’s economy around productivity, enterprise, and inclusive growth. The framework lays out a comprehensive Jobs and Productivity Agenda, focusing on the development of skills for productivity, sectoral engines of growth, enterprise-led development (especially for small businesses), upgrading the informal economy, strengthening data and institutional systems, and promoting productivity as the foundation of national prosperity.
According to the report, the framework will serve as a guide for policymakers, the private sector, and development partners to create quality jobs and raise living standards over the next decade. Erumebor said the NESG envisions ‘a Nigeria where productivity becomes the central metric of national competitiveness-tracked, measured, and elevated as the foundation of shared prosperity.’
The report identified manufacturing, construction, information and communications technology (ICT), and professional services as the sectors with the greatest potential for large-scale job creation and productivity growth. It stressed that investing in these sectors could accelerate industrialization, drive innovation, and generate millions of decent jobs, particularly for young Nigerians entering the labour market each year.
The NESG urged the Federal Government, state governments, and the private sector to treat job creation and productivity improvement as national priorities, noting that these are the true pillars of economic resilience and social stability.
Conclusion
The report also reaffirmed the NESG’s commitment to supporting the implementation of practical policy measures that will strengthen the link between economic growth and employment outcomes. It stated that Nigeria’s population will reach 275 million by 2030 and that to stabilise unemployment at current levels, the country must create 27 million new jobs between 2025 and 2030. Productivity must therefore become the central focus of national planning.
