As of 2024, the Nigerian economy is grappling with a mix of challenges. Nigeria as of today is in a lot of debt and it goes without saying that the country maybe broke.
While there are efforts to diversify and reform key sectors, challenges such as inflation, unemployment, insecurity, and a heavy debt burden continue to hamper growth.
Crude oil is a blessing unto Nigeria but its dependence has now become one of Nigeria’s biggest problem.
Nigeria’s economy continues to be shaped by its dependence on oil, which remains its main export and source of foreign exchange.
However, the volatility of global oil prices has led to economic instability.
Inflation rate has been consistently high, which makes it of significant concern.
The removal of fuel subsidies and exchange rate unification policies, implemented by the President Bola Ahmed Tinubu’s administration have led to inflationary pressures.
As of 2024, inflation is hovering above 20%, causing a squeeze on purchasing power for many Nigerians, needless to say that many are going hungry in the country.
The Central Bank of Nigeria (CBN) recently adopted a more flexible foreign exchange policy, moving towards a single market-determined rate. While this move is intended to address the liquidity crisis in the foreign exchange market, it has led to significant naira depreciation, resulting in further inflationary pressures.
The government is focused on increasing revenue through tax reforms, digitalization, and improved tax collection mechanisms. However, debt servicing remains a challenge, with a substantial portion of the national budget allocated to servicing both domestic and foreign debt. Nigeria’s debt-to-GDP ratio remains under scrutiny, especially with the country’s heavy reliance on borrowing to fund key infrastructure projects.
Agriculture remains a key sector, employing a significant portion of the population, but the sector struggles with infrastructure deficits, poor access to credit, and insecurity in rural areas, particularly in the northern regions.
In recent times, Nigeria has experience Insecurity, particularly due to terrorism, banditry, and farmer-herder conflicts like never before.
This continues to weigh heavily on economic activities in several regions. This has impacted agriculture, trade, and investment, especially in the northern states. In terms of infrastructure, the country still faces a significant infrastructure deficit, particularly in electricity, transportation, and healthcare.
Nigeria’s population, one of the fastest-growing in the world, is youthful, with a median age of about 18 years. However, unemployment, especially among young people, remains one of the country’s biggest challenges. Many youths are turning to informal jobs or emigrating in search of better opportunities.
Poverty levels remain elevated, with a substantial portion of the population living below the poverty line. The combination of inflation, unemployment, and insecurity has worsened living conditions for many Nigerians.
Nigeria’s economy in 2024 is at a crossroads. A good measure of right and economic polices geared towards growth need to be put in place, dependence on crude oil needs to be eradicated and corruption needs to be reduced to the bearest.
In my opinion, corruption cannot b
e fully eradicated from any state.
