Oye: Economic growth not inclusive, households, businesses strained

By Merit Ibe

The Alliance for Economic Research and Ethics (AERE) has said Nigeria cannot claim to be experiencing inclusive economic growth as long as households, farmers and businesses continue to struggle with rising prices, high borrowing costs, insecurity and an increasingly expensive operating environment.

Chairman of the group, Dele Kelvin Oye, stated this in a policy brief titled, “From Poverty-Fuelling Growth to Inclusive Growth: What Government Must Do to Turn Reforms into Broad-Based Prosperity.”

Oye argued that improvements in government revenue and headline economic indicators would remain meaningless unless they translated into higher incomes, decent jobs and lower poverty levels for ordinary Nigerians.

According to him, government should focus on creating an enabling environment for businesses rather than taking over the role of the private sector.

“The state should function as ‘a credible referee, enabler and protector of productive enterprise, not a costly substitute for it,’” he said.

Quoting figures from the National Bureau of Statistics (NBS), Oye noted that about 133 million Nigerians, representing 63 per cent of the population, were multidimensionally poor in 2022, describing the statistics as a clear reminder that economic reforms should be measured by their impact on citizens’ welfare rather than fiscal performance or Gross Domestic Product (GDP) growth.

He urged the Federal Government to make price stability a priority by aligning fiscal, monetary and exchange-rate policies to reduce inflation and lower the cost of borrowing. He also called for greater discipline in public borrowing to prevent productive businesses from being crowded out of access to credit.

The AERE chairman advocated wider access to affordable financing for farmers, manufacturers, exporters and micro, small and medium-sized enterprises (MSMEs) through credit guarantees, risk-sharing arrangements, leasing, invoice financing and cash-flow-based lending.

He stressed that financing programmes should be transparent and processed without unnecessary delays.

Oye also urged government to simplify Nigeria’s tax system by harmonising taxes and levies imposed by federal, state and local governments. He recommended creating a single public portal containing all business licences, fees, timelines and appeal processes while eliminating outdated regulations that hinder investment.

He further advised government to allow market forces to drive economic activities by replacing opaque distribution systems with transparent mechanisms such as e-vouchers, tax credits, competitive procurement and open contract data.

According to him, government’s primary responsibility should be to provide security, critical infrastructure, fair regulations and accountability while allowing private businesses to create jobs and drive economic growth.

The AERE chairman said inclusive growth would remain elusive unless it becomes safe and profitable to produce goods, transport products, acquire skills and invest in Nigeria.

He therefore called on government to treat security as an economic asset by protecting farms, highways, markets, ports and industrial clusters through intelligence-led policing, rapid response systems and stronger coordination among security agencies.

Oye also urged increased investment in reliable electricity, efficient transport networks, faster port operations and a transparent foreign exchange market to reduce the cost of doing business.

To cushion the effects of ongoing reforms on vulnerable Nigerians, he recommended stronger social protection programmes and increased investment in healthcare, education, nutrition, apprenticeships and skills development.

“No economic reform can be considered inclusive if ordinary families cannot withstand the transition,” he said.

He further called for stronger monitoring and accountability by linking every government intervention to measurable targets on job creation, household income, exports, local value addition and poverty reduction.

According to Oye, government should publish quarterly performance scorecards, conduct independent evaluations and discontinue programmes that fail to deliver results.

He maintained that the success of economic reforms should not be judged solely by government finances but by whether more Nigerians are able to run successful businesses, cultivate farms, operate factories, earn decent incomes and lift themselves out of poverty.

“The true measure of economic reform is not whether government balances its finances but whether more Nigerians can successfully run businesses, cultivate farms, operate factories, earn decent incomes and lift their families out of poverty,” Oye said.