Browsing: Nigeria’s economy

Most African economies have been staring into an economic abyss, besieged by a plethora of daunting challenges that have left many teetering on the edge of a precipice. A glance into Africa’s economic crystal ball for 2023 depicts a mixed bag of fortunes, with some economies set to flourish like a green bay tree, some will find themselves staring down the barrel of a recession whilst others will remain in the doldrums.

According to the International Monetary Fund (IMF), economic growth in Sub-Saharan Africa is expected to reach 3.7 percent in 2023.  Slowing global growth, higher external borrowing costs and weaker domestic currencies, are now the dominant factors weighing on Africa’s economies next year. In reiteration, the Economist Intelligence Unit (EIU) predicts that African economies will face turbulent times in 2023, as a range of internal and external shocks undermine growth prospects and threaten stability, but most of countries will…

The World Bank, in 2020, announced that the Nigerian economic may see a dip into recession, the worst the African country has seen in 40 years. This was largely due to the effects of the fall in the global price of oil, a commodity the nation's economy is heavily reliant on, and the outbreak of the COVID-19 pandemic, that nearly crippled not just Nigeria’s, but the global economy.  

But these challenges were not the only catalysts for Nigeria’s imminent recession, issues around insecurity, infrastructural deficit, trade barriers, and power supply challenges all form a crude mix that has managed to drive the country down this very path.  

Since the election of the Buhari’s administration in 2015, a lot more focus has been placed on driving local content and boosting local production, particularly in the agriculture sector. This was also in line to make the Nigerian economy

The Finance Bill, that became law as of February 1, 2020, among other things, increased the Value Added Tax (VAT) rate from 5% to 7.5%. The additional revenue is intended to fund healthcare, education and infrastructure. To mitigate the impact of the VAT rate increase, the Government expanded the list of VAT-exempt items to include staples such as bread,cereals, all kinds of fish, flour and starch meals;fruits, nuts, pulses and vegetables,root vegetables, meat and poultry products,milk,salt and herbs, and natural water and table water.

The Bill is also not intended to be a ‘one-off’ document as the government intends to amend the Finance Act annually along with each appropriation Bill; as a way to ensure that there exists a more integrated fiscal structure in governance, and more efficient planning.

The key changes in the statute lean towards the Federal Government’s stance that the ‘common man’ was considered in the development…

The Finance Bill, among other things, proposed an increase in the Value Added Tax (VAT) rate from 5 per cent to 7.5 per cent. The additional revenue from the increase in VAT rate would be used to fund healthcare, education and infrastructure. The Government intends to mitigate the impact of the VAT rate increase by introducing a VAT exemption threshold for businesses with a turnover of less than N25 million per annum, and expanding the list of VAT-exempt items to include the following:

1. Brown and white bread;
2. cereals including maize, rice, wheat, millet, barley and sorghum;
3. fish of all kinds;
4. flour and starch meals;
5. fruits, nuts, pulses and vegetables of various kinds;
6. roots such as yam, cocoyam, sweet and Irish potatoes;
7. meat and poultry products including eggs;
8. milk;
9. salt and herbs of various kinds; and
10. natural water and table water.

The Bill was signed into law by the President, Muhammadu…