Insecurity challenges that persisted after 2022 may exacerbate poverty and the high unemployment rate in 2023, according to a report by Augusto & Co, a research, credit‑ratings and risk‑management firm. The firm’s report, titled “2023 Outlook: Nigeria, a Nation on the Precipice,” states that Nigeria’s insecurity will remain a major issue in 2023. It worsened in 2022 and is now widespread across many parts of the country. The scale of the problem will require a two‑pronged approach: deploying resources to military artillery, personnel and intelligence, while also confronting the deeper issues of pervasive poverty, high unemployment and extreme inequality.
The report notes that the World Bank has revised its economic‑growth projection for Nigeria downward to 2.9 % from the 3.2 % initially stated in June 2022. Augusto & Co offers a slightly more optimistic forecast of 3 %, hoping that GDP growth will be supported by election spending, improved oil output (to 1.3‑1.4 million barrels per day) and still‑high oil prices ($88 per barrel). However, growth will be constrained by low investment and productivity. The speed with which Nigeria can curb rampant oil theft and vandalism will be crucial for boosting foreign‑exchange earnings and giving the Central Bank of Nigeria enough ammunition to intensify its interventions in the forex market. The report also expects high global interest rates to continue limiting capital inflows and adding to currency pressures in 2023.
Regarding fiscal policy, the likely restructuring of the Ways and Means stock (estimated at N22.7 trillion) in 2023 is expected to span several years to avert a liquidity crunch, but it may tighten credit conditions if uptake is largely domestic by banks. This would push up debt‑servicing costs significantly, as Ways and Means Advances are projected to account for 30 %—the largest chunk—of Nigeria’s N77 trillion debt stock by May 2023.
The removal of subsidies, and the associated incentive for smuggling, should finally end the confusion over actual petrol consumption in Nigeria and, in theory, right‑size petrol imports, which account for 15 % of the total import bill, thereby conserving valuable foreign exchange. The launch of the 650,000 bpd Dangote refinery in January 2023 is a potential game‑changer, as it could completely eliminate Nigeria’s petrol imports, provided there is full price deregulation of petrol to exploit the export market. Additionally, the 60,000 bpd Port Harcourt refinery is expected to be completed and back on stream in the first quarter of 2023.
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