Nike Popoola
To attract more foreign investments into the Nigerian economy, the policy environment needs to be strengthened by the implementation of more liberal and clearer policies, the Chief Economist for North and West Africa, Oxford Economics, Cobus de Hart, has said.
He was a guest speaker at the Institute of Chartered Accountants of Nigeria/ Institute of Chartered Accountants in England and Wales joint economic insight event held in Lagos.
While speaking on the theme, ‘Nigeria: The African giant crawling back on its own and its untapped technological potential’, Hart stated that the Nigerian business environment was still seen as very unfriendly, especially since the wrong policies were implemented after the oil shock.
However, he observed that the economy had witnessed a progressive shift to non-oil outputs.
He said, “The non-oil sector is now the main driver of growth. The non-oil sector has expanded from 0.8 per cent to 2.7 per cent. That is actually progressive.”
According to him, diversification could be accelerated with even more liberal policies.
Hart also said that the near-term outlook was encouraging with PMIs hinting at a solid start to 2019, FX risks had eased off considerably and the loosening of the monetary policy.
According to him, despite the 2019 general elections, portfolio investor appetite was still strong, and this had prompted the Central Bank of Nigeria to change policy direction.
Taking a cue from a 2017 World Bank report, Hart noted that Nigeria was still largely unbanked with only 39 per cent of adults having accounts in financial institutions.
He said, there was still a huge mobile money opportunity in Nigeria because of its population, but this was not the case with mobile penetration.
Hart stated, “As of 2017, Nigeria only had 39 mobile money accounts per 1,000 adults and saw only 447 mobile money transactions per 1,000 adults. In China, guess what the transactions figure was? 52,000! Despite such as a large market, Nigeria is lagging far behind its peers.”
He affirmed that sub-Saharan African countries in general had seen a sharp increase in mobile penetration, while East African countries like Kenya took the lead.
With the rise in financial technology, Hart said that Nigeria was making progress in fintech opportunities.
He stated, “It is nice to see that Nigeria is making progress in fintech. Last year, the Central Bank of Nigeria launched the Payment Service Banks licensing guidelines with the aim to increase financial inclusion. What this does now is that it allows telecommunication companies to provide limited financial services like holding deposits, payments and remittances, issuing debit and prepaid cards.”
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