Nigeria’s Minister of Finance and Coordinating Minister of the Economy, Wale Edun, acknowledged the difficulties that recent government reforms have caused for Nigerians but emphasized their necessity for economic growth.
Speaking at the Nigeria Economic Summit, he highlighted the urgent need for reforms due to falling oil revenues and a significant budget deficit.
Edun outlined key reforms, including the removal of subsidies, the unification of the foreign exchange market, and improvements in domestic revenue mobilization, which have doubled government revenue through technology.
He also described innovative measures to enhance transparency in public procurement.
“First, was to remove subsidy, unify the FX market and start domestic revenue mobilization and by the first half of this year, aggregate revenue was doubled through application of technology.
“Secondly, rather than waiting for compliance, we look at how MDAs were allowed to spend and the percentage of the surplus that accrued to government and we deduct automatically.
“Another new innovation we have introduced is that we now have approval for MDAs procurement payment to be made directly to third party, thereby boosting transparency in the running of governance,” the minister explained.
He added that the funds saved from subsidy removal are being reinvested in agriculture, impacting over 20 million people, and in initiatives like the education loan fund, which has processed 250,000 applications.
The reforms have reportedly saved the country 5% of GDP.
“Government had to undertake necessary but painful policies that are currently having impact on cost-of-living industries and individuals.
“However, these funds are reinvested in agriculture as stakeholder farmers have so far been given inputs and over 20 million people from four million households have been empowered and it will rise to 15 million.
“Also, we have set up an education loan fund (NELFUND) and so far we have processed 250,000 applications and 30 per cent students are already funded.
“We also have the consumer credit scheme that is providing Nigerians with the funding they require to improve their lives. Thus, these reforms have saved the country 5 per cent of GDP,” he further stated.
World Bank Country Director for Nigeria, Ndiamé Diop, stressed the importance of increasing revenue to manage debt, noting improvements in Nigeria’s revenue-to-GDP ratio from 7.6% to 10.5% due to these reforms.
