A senior public sector specialist, domestic resource mobilization with the World Bank, Rajul Awasthi, has revealed that between 2015 and 2019, Nigeria’s non-oil revenue was among the lowest in the world and as a result the second lowest in spending.
Awasthi who disclosed this at a virtual pre-summit themed ‘Critical Tax Reforms for Shared Prosperity’ organized by the Nigerian Economic Summit Group (NESG) during the week, maintained that Nigeria would have no choice but to get rid of the subsidy eventually.
Awasthi said Nigeria is in an unfavourable economic situation due to dwindling revenue, the continued payment of trillions of naira on fuel subsidy by the government and the attendant economic challenges.
In a slide he shared during his presentation, which showed Nigeria’s Development Update (NDU), Awasthi said that between 2015 and 2019, Nigeria’s non-oil revenue was among the lowest in the world and as a result the second lowest in spending.
He said that the country’s oil revenue was also falling even when oil prices were higher.
“Nigeria has the largest economy in Africa and the largest country in Africa by population, so it is critical to Africa’s progress. There is no doubt about that,” Awasthi said.
“But the government of Nigeria, from the public finance perspective, is facing an existential threat. Let’s not downplay the situation. That is the actual reality.
“Nigeria is 115th out of 115 countries in terms of the average revenue to Gross Domestic Product ratio. Despite the oil prices rising the way they have been, net oil and gas revenues have been coming down because of the tremendous impact of the subsidy.