Review of the Nigerian economy in 2020 and key priorities for 2021 and beyond

Abstract

The Nigerian economy faced significant head winds in 2020 arising from the COVID-19 pandemic. The pandemic exacerbated the realities of rising inflation, unemployment, a tightening fiscal space, and a faltering currency. With the significant macroeconomic challenges facing the nation, critical steps need to be taken to promote economic recovery, sustained growth and socio-economic development. In its 2021 Macroeconomic Outlook Report, the NESG highlighted four key priority areas that are important in attracting private investment which is critical in achieving sustained growth and development in the short and long term. These priority areas are macroeconomic stability, policy and regulatory consistency, sector reforms and human capital development. The first two priorities are critical in the short run. The government has a key role to play in stabilizing the macroeconomic environment and implementing policies which will support economic recovery and promote sustained economic growth further into the future. Sectoral reforms and human capital development, on the other hand, will mainly support improved economic outcomes in the medium to long-run. The potential of key sectors of the economy to attract private investment needs to be harnessed through sectoral reforms. In addition, human capital development is critical to achieving human development and maximizing the productive capacity of the nation.