AGAINST the backdrop of global trade wars and policy failures, economists and industry leaders have expressed deep concern over the future of Nigeria’s economy, saying 2025 outlook would be turbulent, with uncertainty pervading the landscape.
They spoke at the 2025 Vanguard Economic Discourse held in Lagos yesterday, with the theme, “ Nigeria’s Economic Outlook 2025: Hardship and Pathways to Sustainable Recovery.”
The event was chaired by Mr. Dele Oye, who is the President of the National Association of Chambers of Commerce, Industries, Mines and Agriculture, NACCIMA.
Oye is also the Chairman of the Organised Private Sector of Nigeria, OPSN.
Other facilitators include Prof. Franklin Ngwu, Director of Public Sector Initiatives, Lagos Business School, who functioned as panel session Moderator with the Panelists including Chief Davidson Alaribe, who is the President of the Institute of Chartered Accountants of Nigeria, ICAN, Dr. Tayo Aduloju who is the Chief Executive Officer of the Nigeria Economic Summit Group, NESG, and Dr. Femi Egbesola, the President of Association of Small Business Owners in Nigeria, ASBON.
Also on the panel were Dr. Muda Yusuf, Chief Executive, Center for Promotion of Private Enterprise, CPPE, and Ms. Demi Samande, Founder/ CEO, Majours Holdings.
It was headlined by Dr. Yemi Kale, former Statistician General of the Federation/ Director General of the National Bureau of Statistics, NBS, and currently the Group Chief Economist/ Managing Director, Research & International Cooperation, Africa Export-Import Bank, Cairo.
Speaking on the theme, Dr. Kale, said: “The sub-theme speaks, not only to our current struggles but also to our unwavering hope as Nigerians for a resilient, inclusive and prosperous Nigeria.”
Referencing the global economic pressures arising from the on-going tariff war ignited this week by the United States of America, Dr. Kale said much like its counterparts across the continent and broader global economy, the Nigerian economy stood at a critical strategic juncture.
According to him, the confluence of heightened global volatility, systemic domestic vulnerabilities, and a shifting geopolitical equilibrium has redefined the parameters within which we must now operate.
Speaking on the policy response to the situation, Dr. Kale said these dynamics had disrupted traditional policy levers, complicated macroeconomic forecasting and constrained the latitude available for both fiscal and monetary interventions.
He added that in this environment, a business-as-usual approach was no longer tenable.
He stated further: “What is required is a comprehensive reorientation of our economic strategy, anchored on structural reforms, productivity-enhancing innovation, and a deliberate pivot toward inclusive, human-centered development.
“The success of this transition will hinge not only on the policies we enact, but also on the institutional capacity, inter-agency coordination and political resolve we bring to bear in executing them.
“Each time I reviewed global and domestic economic indicators or developments, new data points and economic signals emerged, either internationally or within Nigeria, that demanded a re-assessment of data and analysis and conclusions.
“The world is in flux, the signals are mixed, and the outlook is riddled with contradictions. If I were to summarise the defining theme of 2025 in a single word, it would be turbulence, closely followed by uncertainty.
“These are not just buzzwords, they are real forces shaping global and domestic economic behavior and outcomes. And for developing economies like Nigeria, which are already navigating significant structural and institutional weaknesses, this turbulence creates profound challenges.
“Planning in such an environment becomes exponentially more difficult. This is because economic uncertainty disrupts decision-making across the board. Households, businesses, governments, investors, and financial institutions all behave differently under conditions of volatility and uncertainty, and often in ways that reinforce economic fragility.
“Households, for instance, tend to reduce discretionary spending and increase precautionary savings during periods of uncertainty, that is, if they have any disposable income to save in the first place.
“For the vast majority of Nigerians who live hand-to-mouth, even minor economic disruptions can be catastrophic.”
Nigeria needs economic sovereignty – NACCIMA boss
Meanwhile, President of the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture, NACCIMA, Mr Dele Oye, stressed the need for Nigeria to seek economic sovereignty and adopt a viable and affordable homegrown democracy as a way of escaping the fallouts of global trade challenges spiked by the Trump–driven tariff war.
Oye, who is also the Chairman of the Organised Private Sector of Nigeria, OPSN, gave the charge, while delivering his opening speech as chairman of the occasion.
He stated: “In this pivotal moment, we must recognise and confront the significant challenges before us – challenges that have been magnified by the advent of America’s ‘America First’ policy.
“This paradigm shift in global trade, driven by protectionism and tariffs, presents a unique and formidable array of obstacles for developing nations such as ours.
“The world we once knew, one characterized by cooperative, rules-based trading systems under the World Trade Organization, has given way to an environment fraught with uncertainty.
“This transformation not only disrupts global markets and supply chains but poses an acute threat to our competitive standing in international trade.
“The recent implementation of a 14% tariff on Nigerian exports to the United States directly jeopardises what has historically been a critical market for our key goods, including crude oil, liquefied natural gas, and agricultural products.
“The ripple effects of reduced demand could precipitate job losses, economic instability and a decline in vital foreign exchange inflows, particularly for our non-oil sectors.
“In the face of these multifaceted challenges, Nigeria must act decisively and strategically. We are at a crossroads where we can reshape our economic destiny, where adversity can give rise to opportunity.
“We need a political structure that can withstand external pressures and remain resilient in the face of global shifts.”
Nigeria failing to pursue national development – NESG CEO
Also speaking at the event, Chief Executive Officer, Nigeria Economic Summit Group, NESG, Dr. Tayo Aduloju, blamed Nigeria’s economic problem on failures in the pursuit of national development programme.
He said: “Nigeria’s problems that are economic are not first economics; the economics of our problem is a subset of how we have defined the problem.
“So the problem is, Nigeria has failed to pursue its national development as a responsible sovereign.
“What that means is the political elite, the business elite, and any other elites that may exist, including the military elite, have been jointly, by action or inaction, in a conspiracy of slowing down, or in some cases mitigating Nigeria’s economic development.
“This is an important truth to first accept that we are here by choice, not the choice of others, but by our collective choice that anything happening in Nigeria is because somebody outside the world wished it on us.
“From Dr. Kale’s example of the case studies he narrated, if it was wished upon those countries, they won’t be where they are today.
“Then the question is, how do you build a strong nation-state? You build it on three pillars – strong political institutions, strong economic institutions, strong social institutions, and these institutions must be led by certain type of leadership.”
He called for deeper engagement between the private sector and government to drive economic transformation in Nigeria.
He noted that current methods of engagement between government and private sector often failed to create tangible change and called for a more collaborative approach to economic development.
Aduloju said: “Real economic progress is made when both the private sector and government co-deliver on specific goals, with clear responsibilities and accountability mechanisms in place. ‘’By the way, there is a pedestrian definition of engagement that would fit that model. However, in every case that Dr. Yemi Kale presented this morning in Brazil, Indonesia, and Malaysia, how these countries grew was that there was a consensus in the private sector and a consensus in government that co-deliver economic transformation.
“If we say today, we want to transform the energy sector, the energy plan will have two sides, what government must do, what businesses must do, and accountability and responsibility mechanisms to check what everybody is doing; and what they are doing right.”
The NESG CEO also stressed the importance of de-risking Nigeria’s vast infrastructure stock, which he estimated at $3 trillion.
“If you removed, if you depoliticized it, if you de-risked it today, that infrastructure will be attractive to global and local investments.
‘’There is need for the private sector to be offered the right incentives and conditions for investing in critical infrastructure, such as ports, rail, roads and energy.”
Nigeria’s economy can’t solely run on market principles – Muda Yusuf
Commenting during the panel session, the Chief Executive Officer, Centre for the Promotion of Private Enterprise, CPPE, Dr. Muda Yusuf, cautioned against placing the country’s economy on purely market-driven principles for its development, even as he pushed for more clarity in trade policy on import and export tariffs.
Yusuf, who noted that the country could not afford to leave the economy purely to market principles, stated: “There is a need for an ideological consensus in the economic management process.
‘’We cannot afford to leave the economy purely to market principles, because if we continue to follow that path too heavily, we will continue to create more hardships for the people.
“It is essential to recognize market failures in economics, which means that the market cannot deliver everything.
“This implies that whatever the market cannot deliver, the government needs to intervene and that way, it will create a much better environment for businesses and the citizens.
“We need a strong government intervention policy in the energy space because If we give entirely to the private sector, it will not work because the private sector is to chase profit. ‘’Energy provision is critical for economic development, and poverty reduction and is also critical for reducing poverty and building an inclusive economy.
“So, we need to have a framework of how the government will intervene in such areas as energy, health sector, education sector and some other critical sectors and public transportation.
“Now, we have a system that does not have sufficient public transportation system. If you go through our roads, all the buses are rickety. Why are they so rickety? They are rickety because the import duties you pay to be able to import a bus and ply the road are getting close to 20, 25 per cent. So, the role of government in these sectors cannot be overemphasized.”
While noting that it was extremely important that Nigeria got its fiscal policies right, Yusuf said:
“We are not having sufficient conversation and engagement, particularly on the trade policy component of our policies. When I talk about trade policy, I am talking essentially about things that have to do with import and export tariffs.
“We have a trade policy process that seems to emphasise more revenue generations. That is why over time, when the National Assembly is engaging the Customs, the conversation is always about the target on revenue.
“This kind of mindset has a way of putting unnecessary pressure on businesses. So it is very important from the trade policy perspective to use tariff instruments to support investment.’’
On the tariffs debacle, he explained: “The tariff regime in Nigeria is too high, even for sectors where we don’t have the capacity for raw materials, inputs. This is something we need to engage very seriously with the administration, so we can see a situation where we de-emphasise this revenue generation mindset on investments.
“This is because it will make it easy for investors, for manufacturers, to go to the market. It will make it easy for manufacturers to go through the international trade process more easily and it will be able to generate more profit and pay even better taxes in the form of VAT, and company tax.
“But when they are strangulated at the point of bringing their raw materials, machinery and all of that, It will make life so difficult for them that, by the time they are producing it, they are producing under very difficult circumstances.
“However, the engagement on the appropriate trade policy and the need for us to move the mindset away from revenue generation in the trade process to facilitating trade, is extremely very important as we need to see much stronger advocacy from the private sector on all of these issues because, again, when we look at the private sector, there is a bit of fragmentation which affects the effectiveness of our government.”
Manufacturers spend 40% annually on energy cost – Samande
Speaking on the challenges of the manufacturing sector, the Chief Executive Officer of Majeurs Holdings, a furniture solutions company, Ms. Demi Samande, raised alarm over the high cost faced by manufacturers in providing energy for their operations.
She said the cost of energy gulps about 40 per cent of manufacturers’ revenue, even as global competitors spend less than 10 per cent on energy for their production lines.
Speaking as a panelist, Samande said every single blackout in Nigeria results in a loss in profit, fewer jobs and stunted growth for small and medium-sized enterprise, SME, manufacturers or business owners.
She stated: “Nigerian manufacturers, on average, spend about 40 per cent on energy, predominantly diesel, throughout the year. Our global competitors are averaging less than 10 per cent on energy for their production lines.
“My personal experience of this has been the high cost of diesel. I did not grow up in Nigeria. I came here because I had a dream of manufacturing in Africa and exporting to a global market. And I am sharing with you a little bit because that experience so far has been distracted by incredibly high power resources that I have to endure every single day, from diesel expenditures to wastage.
“The average Nigerian SME goes about 25 to 45 per cent waste factor in their production lines. For me, that is incredibly scary as a young manufacturer. Profitability is affected every single day.”
ICAN boss kicks against borrowing for recurrent expenditure
Meanwhile, the Institute of Chartered Accountants of Nigeria, ICAN, has advised government to prioritise loan focussed on developing infrastructure than on recurrent expenditures.
President of ICAN, Chief Davidson Alaribe, who was represented by Dr. Oluseyi Oladimeji Olanrewaju, Honorary Treasurer, ICAN, frowned on government’s continuous reliance on deficit budgeting.
He said: “While borrowing is understandable given limited resources, the core issue lies in what the borrowed funds are used for. Instead of funding infrastructure or developmental projects that support businesses and economic growth, much of the debt is channeled toward recurrent expenditures, which is financially unsustainable and ineffective.”
He said most businesses end up providing their own infrastructure due to government’s failure, prompting questions about where borrowed funds were really going into.
He said loans were not bad but noted that their purpose must be targeted at infrastructure development to ease business operations and stimulate tax revenue.
His words: “I should talk a bit like an accountant and then I will relate it to what is happening in government. As we know, to fund a business, we say you do equity at the beginning, and when the business is growing and you want to expand, then you can look the way of debt.
‘’To borrow, you must be specific as to what you want to use the money for, and the return that you are getting from that expansion or from the project must be more than what you are paying as interest on the loan, that is talking as a businessman.”
ASBON calls for co- creation of economic policies
At the panel session, the Association of Small Business Owners, ASBON, called on the government to create economic policies for sustainable growth and economic development.
President of ASBON, Dr. Femi Egbesola, said government’s attitude towards the growth of small businesses has not changed over the years.
Egbesola also said it was important for both the government and private sector to create policies, with a view to implementing, monitoring and evaluating policies.
He stated: “Over the years, we have been advocating that government needs to collaborate and engage particularly the private sector. From the private sector, which I represent, it’s been one recurring decimal over the decades and that is ,why we have been having the same result over the years. There is no change, there is no shift.
“We have been saying it, you do not need to only regulate us, we need to have a handshake, a strong hand shake for that matter. It is important for you to always create policies, particularly the one that has to do with the private sector.
‘’It is important to engage stakeholders in monitoring policies, implementing policies, evaluating policies and that is the only way it can work.
“When it comes to policies, it should be abinitio, from the beginning, so government doesn’t need to come out to regulate some sectors of the economy, and leave others.’’
The Vanguard Economic Discourse, the national development thought leadership event hosted by Vanguard Newspapers every year, has gained traction in the past eight years as a major public-private sector platform for reviews and cross-fertilisation of economic development ideas by Nigeria’s public and private sector leaders. (Vanguard)
