Nigeria’s economy could expand by as much as 4 to 4.5 per cent in 2026 if the government sustains ongoing reforms, adopts more realistic budget assumptions and removes long-standing structural constraints, according to Dr. Muda Yusuf, Chief Executive Officer of the Centre for the Promotion of Private Enterprises (CPPE).
Speaking during an interview on ARISE NEWS on Tuesday, Yusuf said recent policy adjustments have begun to stabilise key macroeconomic indicators, but warned that growth prospects remain vulnerable to both domestic and external risks.
Cautious optimism on growth
Yusuf, a former Director-General of the Lagos Chamber of Commerce and Industry, said many analysts are increasingly optimistic about Nigeria’s medium-term outlook. However, he stressed that projections must be treated with caution, especially given Nigeria’s heavy dependence on oil revenues.
He identified crude oil price volatility, global geopolitical tensions, domestic security concerns and unresolved issues around tax reforms as major downside risks that could derail growth if not carefully managed.
Budget assumptions under scrutiny
The economist urged lawmakers and fiscal authorities to reassess budget benchmarks, particularly assumptions on oil prices and daily crude oil production.
According to him, overly ambitious revenue expectations have historically undermined budget performance and weakened public confidence in fiscal planning.
“More conservative and realistic assumptions improve planning and increase the likelihood that budgets will be implemented as intended,” Yusuf said, noting that credibility is critical for investor confidence.
Global developments and oil markets
Commenting on international developments, Yusuf referenced geopolitical tensions involving oil-producing countries such as Venezuela. He argued that while such events can influence global oil markets, their short-term impact on prices may be limited due to Venezuela’s relatively low output and years of underinvestment caused by sanctions.
Tax reforms and economic confidence
On recent tax reform debates, Yusuf acknowledged that tensions appear to be easing but cautioned that implementation must be pragmatic.
While emphasising the importance of obeying the law, he warned that abrupt or poorly managed enforcement could unsettle businesses and households, potentially creating fresh economic disruptions.
Growth without jobs a risk
Yusuf also addressed concerns about “jobless growth,” arguing that strong GDP numbers do not automatically translate into better living standards.
He said employment creation depends largely on investment, which in turn is shaped by the quality of the business environment, including policy consistency, infrastructure and regulatory efficiency.
“Macroeconomic stability is necessary, but it is not sufficient,” he noted, adding that productivity-enhancing reforms are essential to attract and retain investment.
Structural bottlenecks remain
Persistent challenges such as unreliable power supply, regulatory inefficiencies and weak institutions continue to weigh on productivity, Yusuf said. These issues, he warned, discourage both local and foreign investors.
He singled out regulatory practices that prioritise revenue generation or bureaucratic processes over economic growth, calling for deeper public sector and regulatory reforms.
Sectors with high job potential
According to Yusuf, sectors such as agriculture, construction, trade, information and communication technology (ICT), entertainment and tourism have strong potential to drive inclusive growth due to their capacity to absorb large numbers of workers.
Construction, agriculture and distributive trade, in particular, could play a significant role in reducing unemployment if supported by appropriate fiscal, monetary and trade policies.
Private sector as growth engine
Yusuf concluded by stressing that sustainable economic transformation depends on enabling private enterprise.
“Governments do not create jobs; the private sector does,” he said, adding that growth will ultimately be driven by a supportive policy mix that encourages entrepreneurship, investment and productivity across the economy.
Source: Africa Publicity
