The World Bank at the weekend said it was planning to increase its funding to Nigeria by $4.5 billion over the next three years to support projects in the power and health industries and in governance, its Vice President for Africa said.
“This is indicative – in the next 18 months or so, we expect to put in place projects for around $2.5 billion,” Hafez Ghanem, said in an interview Thursday in Abuja. “We are thinking about financing more investments in power and the area of social protection.” The bank currently has over 30 projects estimated at $10 billion in Nigeria.
President Muhammadu Buhari in June signed the country’s N9.1 trillion ($25 billion) budget for 2018, the biggest ever, to boost infrastructure investment in the country to support economic recovery. This was as the International Monetary Fund (IMF) forecast Nigeria’s economy will expand 2.1 per cent this year after it contracted in 2016, when prices and output of crude declined. Budget documents forecast a deficit of N2 trillion, more than half of which will be plugged by borrowing.
But ahead of general elections in February next year, experts have called on the President to address leakages in revenue collection, power shortages and fuel subsidies, among other things.
Speaking at an event in Abuja, Ghanem, said, “non-oil tax collection in Nigeria is presently very weak and well below the levels of structural and regional peer countries. Nigeria needs to increase its non-oil revenue collected at both the federal and state levels across the main type of taxes; income, VAT, excises and Customs, and states’ internally generated revenues.
“To do that requires strengthening tax administration and increasing compliance rates and reforms including rationalising tax incentives and exemptions and selectively increasing rates such as excise on alcohol and tobacco.
“The elections are unlikely to directly impact growth in 2019, although inflationary pressures may increase from election spending. We are concerned about potential delays in implementation of government programmes due to the focus on elections. We urge the government to remain focused on implementing the Economic Recovery and Growth Plan (ERGP), which includes the power sector recovery plan.” The blueprint covers 2017 to 2020 and seeks to revive the oil-reliant economy,” he said.