Nigeria’s massive public sector deficit is the biggest threat to the Federal Government’s goal of transforming the country into a $1 trillion economy by 2030, according to the Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA) and the Organized Private Sector of Nigeria (OPSN).
NACCIMA President, Dele Kelvin Oye, who also chairs the OPSN, while acknowledging that structural reforms are essential, said there was the need to confront the hard truth, which is that persistent public sector deficits and continual borrowing, much of it to finance recurrent expenditure, continue to crowd out private investment and exert inflationary pressures.
He, therefore, charged the Federal Government to adopt and implement a more rigorous public financial management strategy, emphasizing the need to prioritize capital over recurrent spending, aggressively expanding the tax base rather than raising tax rates, improving expenditure efficiency, and plugging leakages across all levels of government.
“These are critical steps not only for restoring macroeconomic stability, but for rebuilding investor and business confidence,” Oye said in a statement.
He also commended Finance Minister Wale Edun and Central Bank of Nigeria Governor Olayemi Cardoso for their candour in acknowledging the formidable macroeconomic and social challenges currently confronting the nation, as reiterated at the just concluded IMF/World Bank Spring Meetings.
He applauded the government’s willingness to collaborate with development partners on job creation and youth empowerment, describing it as timely and commendable.
“We recognize the government’s laudable commitment to single-digit inflation, job creation, digital infrastructure development, and the ambition to transition to a $1 trillion economy by 2030,” Oye said.
He noted, however, that the recently released Africa Pulse report by the World Bank starkly reminds of the urgent threat of deepening poverty in Nigeria, with the national poverty rate projected to surge to 56 per cent by 2027.
“The dramatic growth in the number of Nigerians living below the poverty line, surging inflation, youth migration, and the expanded fiscal deficit underscore the need for even faster, targeted, and pragmatic policy action,” he said.
On key areas of concern and recommendations, the NACCIMA boss said the CBN’s prevailing monetary stance, with commercial lending rates hovering at 30-40 per cent, risks stifling entrepreneurship, industrial production, and agricultural expansion.
“This credit environment, while targeting inflation, paradoxically holds the productive sector hostage and suppresses the job creation and innovation capacity of the private sector. NACCIMA, therefore, calls for targeted intervention funding and special credit windows for MSMEs and strategic sectors at concessionary rates to unlock growth, employment, and food security,” he said.
Noting that the exodus of skilled youths (japa) is an ominous trend fuelled by economic disenfranchisement and insecurity, Oye called for immediate mass-scale public works, digital skills training, and security sector investments in the hardest-hit zones to tackle youth migration and insecurity.
“Government must ring-fence funds for youth-targeted entrepreneurship programs and rural enterprise stimulation—especially in agriculture and light manufacturing—to make staying in Nigeria a viable and attractive option,” Oye said.
“While monetary tightening may slow inflation, root causes, such as food supply chain disruptions, energy deficits, over-regulations, inconsistent policies, forex volatility, and excessive fiscal injections, must be concurrently addressed. NACCIMA advocates for: fast-tracking strategic food importation and logistics support, ensuring farmers’ access to affordable input through targeted subsidies, commitment to the continuous provision of naira crude to existing local refineries, while accelerating modular refining projects to reduce fuel import dependency.
“We appeal for more structured dialogue with the organized private sector actors in policy design and execution, ensuring policy measures are evidence-based and context-sensitive,” he said.
Amid the global shift in economic and geopolitical dynamics, with the dominance of the US dollar gradually declining due to reduced US global share, the overuse of dollar-based sanctions, and advancements in digital settlement systems beyond traditional mechanisms like SWIFT, Oye said it was crucial for Nigeria to recognize these changes and strategically realign its foreign policy.
He said by exploring stronger partnerships and trade ties with emerging economic blocs such as China and the BRICS nations, Nigeria can position itself as a more attractive destination for foreign direct investment.
“Seizing this opportunity will help diversify our economy, stimulate industrial growth, create jobs, and ultimately reduce poverty, while making Nigeria a key player in the evolving global order,” he said.
He acknowledged the bold steps taken by the government under the current reforms, but said the short-term socioeconomic pains, including increasing poverty, joblessness, and insecurity, demand urgent, deliberate, and inclusive interventions.
“Nigeria cannot bank on the patience of its citizens when livelihoods are eroded and aspirations are crushed by economic hardship.
“The time to recalibrate is now: prioritize the productive sector support, rationalize deficit spending, address insecurity, and restore affordable access to credit. With coordinated and courageous action, Nigeria can turn the tide and lay the foundations for shared prosperity, thereby fulfilling the very promise of our economic reforms,” he said.
Oye reiterated NACCIMA’s readiness, as an indispensable partner, to work with all arms of government and the international community “in realizing this urgent national imperative”.
