World Bank Nigeria director Mathew Verghis told African Banker that Nigeria's ambition should be annual growth of 7 to 8 percent, saying there was no reason the country could not achieve that.
GROWTH POTENTIAL AND POLICY CHALLENGES
Verghis said there were very real reasons why that level of growth was not currently being achieved. He said Nigeria needs much better infrastructure services, describing infrastructure gaps as a major drag on productivity.
Verghis said some expected growth of around 4% to 4.5%, and that 4.5% GDP growth recorded in a recent quarter was the best performance Nigeria had had in a decade but "not nearly enough". He said the trillion-dollar GDP target requires a financial sector that is fit for purpose.
BANKS AND FINANCING
Verghis said the banking sector would be a key part of that journey and should be allowed to play its role. He said bank recapitalisation was needed because banks had become undercapitalised, and that 33 banks had recapitalised to the tune of a combined N4.65tr ($3.45bn); loans account for 33% of banking sector assets, he said.
He said Nigeria needs about $100 billion a year to close its infrastructure gaps, with public-private partnerships essential to mobilising private investment.
He also pointed to the World Bank's $500 million financing for lending to micro, small and medium enterprises, expected to reach about 250,000 MSMEs.
Sources: African Business Magazine