Nigeria really needs money to power its economy. We are extremely short of revenue and I support the need to urgently look for global investors and wealth managers. The government alone can't raise money to be used for our infrastructure need.
#Thread
#Thread
An analytical look at the top 10 economies in Africa will make you shake head for Nigeria and how far we are from the mark. The thread will look into the GDP of these countries, their budget, their population and the VAT being paid by the citizens. Nigeria tops the list 
Nigeria has a GDP of $444.92b (2019) with a population of 200m people. Her budget (2019) is $24.6b which is just 5.5% of her GDP. That is the lowest amongst the top 10 economies in Africa and it seems it is the lowest in the world. Her VAT is 5% also the lowest in the world.
The proportion of Nigeria's budget to her GDP is like using a 1KW generator to power a 6 bedroom duplex. There is no way you will get power supplied to all the rooms. You will need to shed light and give power supply to rooms based on their needs. Everyone can't be satisfied.
This piece meal budget is the reason our infrastructure deficit is so huge. We need a radical approach to solve this issue else we will remain in his web for so long. This problem predates this administration but it gets worse based on population increase and size of the economy
South Africa is the next economy to Nigeria in Africa. Her GDP is $371.30b however she has a budget which is 5 times that of Nigeria when her population is a third of Nigeria's. S. Africa's budget (2019=$121.9b) is 32.8% of her GDP. Can you compare that to Nigeria's 5.5%?
The VAT is S. Africa is 15%. Can you compare that to Nigeria's which is 5%? S. Africa's population is 58.6m with a budget of $121.9b while Nigeria has a population of over 200m yet a meagre budget of $24.6b. We can't continue with this kind of budget and expect a radical change.
The third economy in Africa is Egypt. Egypt has a population of 100.4m which is half of Nigeria's but her budget (2019=$94.3b) is almost 4 times that of Nigeria. Egypt GDP is 31.5% of her GDP. Compare that to Nigeria which is 5.5%. There is no way infrastructure development...
...will be the same in these two countries. Meanwhile VAT in Egypt is 14% and it is 5% in Nigeria. Nigeria is short of revenue. There's no way we won't continue in this logjam except we change our approach. We really need the global investors who'll invest their money for returns
The 4th economy in Africa is Algeria. Algeria has a population of 43m people with a 2019 budget of $71.9b which is 39.1% of her GDP which is the highest amongst the top 10 economies in Africa. Imagine the kind of infrastructure development 39.1% GDP will bring about.
If you compare the Algerian budget to Nigeria's, it means Nigeria will need a budget of $173.9b which is N62.6 trillion. By this I mean Nigeria having a budget that is 39% of her GDP. This is the kind of money we need to inject into our economy to make it "gbera".
By the way, VAT in Algeria is 19%. Nigeria needs a lot of radical reforms and decisions to get out of this quagmire. We will continue to construct a 120km road for 5 years because there is no money. There is no reason 2nd Niger bridge should not be finished in 2 years but...
#LagosIbadanRail shd not take three years to complete if there is adequate funds. This is the reason the government will continue to borrow money and VAT will surely be increased. Subsidy will have to go. All neighbouring countries sell petrol for ~$1. We can't continue this way.
Morocco is the 5th largest economy in Africa.
Size of the economy is $121.35b
2019 budget is $31.4b (25.9% of GDP)
Population is 36.5m which is a fifth of Nigeria's but their budget is larger than Nigeria's.
VAT in Morocco is 20%
Size of the economy is $121.35b
2019 budget is $31.4b (25.9% of GDP)
Population is 36.5m which is a fifth of Nigeria's but their budget is larger than Nigeria's.
VAT in Morocco is 20%
Kenya is the 6th largest economy in Africa.
Size of the economy is $99.25b
2019 budget is $27.1b (27.3% of GDP)
Population is 52.6m which is a quarter of Nigeria's but their budget is larger than Nigeria's budget.
VAT in Kenya is 16%
Size of the economy is $99.25b
2019 budget is $27.1b (27.3% of GDP)
Population is 52.6m which is a quarter of Nigeria's but their budget is larger than Nigeria's budget.
VAT in Kenya is 16%
Angola is the 7th largest economy in Africa.
Size of the economy is $92.19b
2019 budget is $22.5b (24.4% of GDP)
Population is 31.8m which is one sixth of Nigeria's population but their budget is almost the same as that of Nigeria.
VAT in Angola is 14%
Size of the economy is $92.19b
2019 budget is $22.5b (24.4% of GDP)
Population is 31.8m which is one sixth of Nigeria's population but their budget is almost the same as that of Nigeria.
VAT in Angola is 14%
Ethiopia is the 8th largest economy in Africa.
GDP is $90.97b
2019 budget is $13.1b (14.4% of GDP)
Population is 112m
VAT in Ethiopia is 15%
Ethiopia has borrowed so much in recent years and that has also influenced their growth. Their debt to GDP ratio is very high.
GDP is $90.97b
2019 budget is $13.1b (14.4% of GDP)
Population is 112m
VAT in Ethiopia is 15%
Ethiopia has borrowed so much in recent years and that has also influenced their growth. Their debt to GDP ratio is very high.
Ghana is the 9th largest economy in Africa.
Size of the economy is $68.26b
2019 budget is $13.6b (19.9% of GDP)
Population is 30.4m
VAT in Ghana is 12.5%. It was reduced from 15%. Nigeria will need 4 times the size of her budget to do what Ghana is doing in her economy.
Size of the economy is $68.26b
2019 budget is $13.6b (19.9% of GDP)
Population is 30.4m
VAT in Ghana is 12.5%. It was reduced from 15%. Nigeria will need 4 times the size of her budget to do what Ghana is doing in her economy.
Tanzania is No. 10 in the top economies in Africa.
GDP is $61.03b
2019 budget is $14.4b (23.6% of GDP)
Population is 58m
VAT is 18%.
Don't be surprised when you see these countries completing a lot of projects. They have some good funds to power their economy.
GDP is $61.03b
2019 budget is $14.4b (23.6% of GDP)
Population is 58m
VAT is 18%.
Don't be surprised when you see these countries completing a lot of projects. They have some good funds to power their economy.
Nigeria is having one of the lowest tax to GDP ratio in the world. It is having the lowest VAT in Africa and perhaps in the world. She does not have enough money to power her economy. Remember the illustration of the 1KW generator being used to power a 6bedroom duplex.
Lot of options are available to us: the bottom line is that we're seriously in need of funds to power the growth that'll take our people out of poverty
Our case is like an anaemic patient who urgently needs blood for survival. The longer he stays without blood, the more dangerous
Our case is like an anaemic patient who urgently needs blood for survival. The longer he stays without blood, the more dangerous
1.We can invite global investors/wealth managers who'll bring in money in return for profit over a period
2.We can raise our VAT which is the lowest in Africa
3.We can sell some of our assets to raise funds: our airports can be given to investors to manage.
4.Subsidy needs to go
2.We can raise our VAT which is the lowest in Africa
3.We can sell some of our assets to raise funds: our airports can be given to investors to manage.
4.Subsidy needs to go
We need money. A lot of our roads are in pitiable condition. There is no part of the country that is not without a large portion of its roads in disrepair. The present legacy projects are good but there are more things to be done and executed and within a short period.
The price of oil will not go up soon. That shows that the thought of getting huge revenue from oil should be perished. We need money. We need funds. Our budget should be a minimum of N30 trillion annually.
How do we get this?
This is the big question for our leaders.
How do we get this?
This is the big question for our leaders.
