Even in the best of all possible worlds, making a transition from a current Gross Domestic Product (GDP) profile of roughly $500bn (five hundred biilion US dollars) to one of over $13 trillion in the space of a half-century would be a giant leap indeed. Taking a nation and its economy to that level would be an arduous and herculean undertaking, one that is sure to task the abilities of even the most astute economic managers and political administrators. But as history, and the ingenuity of the human mind, have shown, it is very much within the realm of possibility, like the historic moon shot of 1969, which put a man on the moon for the first time, and which the man, American astronaut Neil Armstrong, famously described as ‘a giant leap for mankind.’ Or like the giant economic leap made by the tiny Asian city-state of Singapore under the leadership of the globally-revered statesman, Lee Kuan Yew (whose breath-taking transformation he himself described in his bestselling book, ‘From Third World to First: The Singapore Story).
The Nigerian economic and corporate community is abuzz with commentary and analysis in the wake of a recent projection by one of the world’s leading global investment banks, Goldman Sachs, to the effect that Nigeria is set to become the world’s 5th-largest economy by Year 2075, with a GDP of $13.1 trillion. This ambitious projection, which is contained in Goldman Sach’s’ Global Investment Research Report titled, ’25 Largest Economies in the World by 2075,” puts Nigeria ahead of currently more relatively stable economies such as Egypt, Brazil, Germany and even the United Kingdom. The Report also envisages a scenario where China (presently the world’s second-largest economy) surpasses the United States as the largest by 2050 (a little more than a quarter of a decade from now). Even more remarkable, according to the Goldman Sachs Report, America will lose not just its pre-eminent place by 2075, but second place as well – to India. The United States in third and Indonesia (currently the world’s 20th largest economy) in fourth, round out the 2075 Top Five. By 2050, the Goldman Sachs Global Investment Research Report further said, Nigeria would be the world’s 15th largest economy. The rest of the 2050 Top 25, according to it,’ will comprise Pakistan in 6th, Egypt (7), Brazil (8), Germany (9), the UK (10) Mexico (11), Japan (12), Russia (13), Philippines (14), and France (15), Bangladesh (16), Poland (17), Saudi Arabia (18), Canada (19), Turkey (20), Australia (21), Italy (22), Malaysia (23), South Korea (24), and South Africa (25).
As startling as the Goldman Sachs Report may be, though, projections like this are not new. In the recent past, in fact, a number of global financial institutions have made similar forecasts casting Nigeria’s long-term growth prospects in an equally positive and promising light. Like others before it, the Goldman Sachs projection is based on an analysis of GDP growth rates, demographic trends, productivity enhancements and technological advancements. Like others, the economists at Goldman Sachs based their ambitious projection on what they see as the beginnings of a nascent growth trend in the Nigerian economy, thanks to the comprehensive and far-reaching reforms being put in place by the government of President Bola Tinubu.
To be sure, much of the projections contained in the Report are speculative, but they do give a glimpse into a future world order, half a century from now, in which global economic centre of gravity gradually shifts from Western Europe (which has dominated the world economy and generally its direction since the start of the First Industrial Revolution in the late 18th century) towards Asia and to emerging economies like Nigeria – which is already Africa’s largest economy. Though Nigeria is not currently at the centre of this shift, this new economic order is already taking shape. Apart from the ascendancy of China, the group of emerging economies known as BRICS (Brazil, Russia, India, China and South Africa) is already challenging the Western-imposed trade paradigms that have long defined the international economic and financial order – which is often skewed to the benefit of Western Europe and North America, and to the detriment of weaker economies. It is a shift that highlights the dynamic nature of global economy and the growing significance of regions like Africa, the Asia and Latin America in shaping a more diversified world economy.
This shift is set to complement the envisaged multi-polar world order (in which there are more than one or two centres of geo-political influence, unlike what obtained in much of the 20th century when the US/UK vied for dominance with the defunct USSR, with the US eventually assuming the role of sole superpower after fall of Communism in the late 1980s). In the words of Alpesh Patel, Founding Chief Executive Officer of Praefinium Partners, “This shift highlights the crucial role of economic reforms, technological advancement, and demographic trends in shaping the future global economic landscape. The ascent of countries like India, Indonesia, and Nigeria, coupled with the ongoing economic influence of nations such as the US, China, and Germany, illustrates a diverse and dynamic global economy for the latter half of the 21st century.”
But these projections are NOT without a caveat. None of the things the economists at Goldman Sachs have projected are a given as far as Nigeria, in particular, is concerned. There are lots of big ‘IF’s’ when it comes to Nigeria and its quest for meaningful and wholistic economic development, and the Goldman Sachs Report and others are not unmindful of them. On more than a few occasions, experts have predicted that Nigeria’s upward growth trajectory would be all-but-inevitable IF all critical stakeholders (beginning from the government, with the active participation of the private sector) work together to engender more robust investments in critical areas such as education, skills development, investment attraction, infrastructure upgrade, consumer credit establishment, and sound monetary/fiscal policies. If Nigeria would invest in a more intentional manner in scaling up the capacity of its huge youth population; grow sectors like agriculture, energy, and technology (including the Digital Economy), economic growth would be exponential.
But if the relevant indices are not carefully managed (ie if the political and business environments are not made more conducive for legitimate economic activity) the growth trajectory being predicted by the likes of Goldman Sachs could be severely hindered.
As the Report rightly pointed out, managing the above indices must go hand in hand with mitigating both long-standing and emerging challenges such as insecurity and the danger of escalation into political instability, as well as infrastructure deficits, the challenge of diversifying the Nigerian economy beyond crude oil (which over the years has been the subject of much lip-service and grand-standing) and the corrosive effects of climate change – as manifested in flooding in the south of the country, and de-forestation in the north. Other challenges have their roots outside Nigeria, but their impacts have already been felt in the country, and may yet have a more profound impact unless properly assessed and addressed by relevant stakeholders. They include the COVID 19 pandemic and the global lockdowns occasioned by it, as well as geopolitical upheavals such as the war in Ukraine, which led to a disruption in a number of supply chains such as food and energy resources, and to an extent the threats to regional stability posed by events in countries in our own neighbourhood such as Niger, Mali and Chad, to name just three examples. Not to mention the ever-present spectre of Corruption and capital flight. Each in its own way, these factors have resulted in a slowdown of the economy and to the jeopardize it’s ability toreduce inequalities in income.
Mitigating the impacts of these negative factors, and setting Nigeria on course for the growth and transformation projected by Goldman Sachs will not be easy, as President Tinubu and his team are finding out by the day. But, of course, it can be done; happily, the government not only aware of the country’s current profile as far as the HDI indices are concerned, but what needs to be done to actualize Goldman Sach’s long-term projections. “Achieving sustainable growth,” said the Goldman Sachs’ team of economists, “requires economic sacrifices and a globally coordinated response, both of which will be POLITICALLY DIFFICULT to achieve.” And in the words of the afore-mentioned Alpesh Patel, the key to the actualization of Goldman Sachs’ projections lies in the efficient management of economic reforms, demographic trends and technological advancement.
So far, the Tinubu Administration has shown that, along with a deep understandibg of both the causes and effects of the challenges confronting Nigeria, they also possess the political will to do what must be done, and the DIFFICULT choices that must be made, to ensure the welfare of Nigerians today, and the security of Nigerians tomorrow – including generations yet unborn.
