Finance: 5 financial issues within the HSBC report that the Nigerian government is but to deal with

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Finance: 5 economic problems in the HSBC report that the Nigerian government is yet to address


The report painted a sluggish economic system amid record-high unemployment fee, pushing the variety of poverty to 87 million in Africa's populous nation.

The global banking large HSBC in a latest report outlined Nigeria's financial shortcomings under President Muhammadu Buhari's administration.

The report prompt {that a} second term for President Buhari risked prolonging financial stagnation for Africa's largest economic system.

The report titled, 'Nigeria: Papering Over The Cracks', painted a sluggish economy amid record-high unemployment fee, pushing the variety of poverty to 87 million in Africa's populous nation.

The government dismissed the report and tagged the global financial institution as one of many killers of Nigeria's economic system which supported the unbridled looting of state sources by leaders.

ALSO READ: How Sub-Saharan Africa countries convert wealth to well-being for their citizens

In a tensed assertion launched over the weekend by Garba Shehu, senior media aide to President Muhammadu Buhari, Nigeria accused HSBC of laundering cash of the nation's army dictator, Sani Abacha.

Here are some points raised within the report:

1. Sluggish financial progress

Economic growth remains sluggish, and reliant on the rebound in oil output whereas the non-oil economic system, which accounts for about 90% of GDP, continues to languish with multiple service sectors nonetheless mired in contraction

2. Unemployment peek at record-high

Unemployment continues to rise, up nearly three-fold in three years to 19% in Q3 2017, pushing the quantity in poverty to 87 million.

 

3. Faulty tax system

The report said that the expansion outlook might profit from fiscal stimulus following the passage of the 2018 Budget however this expansionary stance might also show to be a key supply of macro danger if Nigeria fails to deal with its fiscal fault traces, including the continuing reliance on oil revenues, inadequate non-oil tax collections and a big share of its funds directed to debt service.

4. Borrowing at an alarming fee

The determination to situation exterior debt to redeem dearer short-term government securities helps cut back debt service prices within the close to term however exposes the fiscal position to change fee danger within the occasion of a future decline in oil prices and naira devaluation

5. Buhari's rating is diminishing quicker forward of 2019 elections

Election-related spending might compound these fiscal issues whereas the ballot itself raises macro dangers given political uncertainty, fractures throughout the ruling All Progressive Congress (APC), and President Buhari’s waning approval ratings.

Also from Business Insider Sub-Sahara Africa:



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