There are reasons for optimism

Nigerian economy is expected to grow even faster if promised reforms take root

Nigeria surpassed South Africa as Africa's leading economy in 2014, thanks to a rebasing to include new sectors such as e-commerce and mobile phones, a recalculation that had not been done since 1990.

Yet the nation's remarkable growth has yet to be reflected in a corresponding way in the lives of millions of its citizens due to range of problems confronting the economy.

This is the big challenge facing Nigeria's economic planners and other authorities.

In spite of several difficulties, the economy witnessed signs of growth early in 2000 when the nation's deregulation process started. That heralded the process of diversifying the economy from its overwhelming reliance on oil income.

Yet this new growth was long ignored or severely underestimated, necessitating the rebasing of the GDP.

The results showed that Nigeria's economic output, in spite of all odds, had roughly doubled, growing by 89 percent to $510 billion and taking the lead from South Africa by more than $150 billion in terms of GDP.

The 24th World Economic Forum was held in Abuja in 2014 in recognition of Nigeria's economic ascendance in Africa.

Chinese Premier Li Keqiang was one of the world leaders that attended the Abuja economic forum. His visit led to the signing of agreements in telecommunication, agriculture, mining and railway infrastructure worth more than $13.1 billion.

However there are reasons to believe that Nigeria's economy is still underperforming. Among the biggest reasons: Diversification remains slow; overreliance on oil persists, accounting for more than 80 percent of GDP; and corruption and insecurity hurt the business environment.

Indeed, experts say in spite of Nigeria's economic momentum, an issue that keeps popping up is the need for a more secure and peaceful environment to attract investors.

It is often noted that more inclusive growth is needed to create job opportunities and reduce the number of people who opt to leave or turn to crime. It is sad to see that security challenges continue to be a drain on the country's economic growth, keeping it from being reflected in the lives of more ordinary Nigerians.

Experts say that the economic rebasing suggests that the country has started to wean itself from long years of depending on oil income. Such sectors as the film industry and telecommunications are playing an increasingly prominent role in economic growth, reflected in their strong growth rates that showed up in the recalculation. Nigeria's telecommunications sector is one of the largest in the world.

As for oil, one area that needs urgent attention is that the country still imports refined oil and exports crude. This is totally unacceptable and not the right way to grow the economy.

There is an urgent need to fix the refineries and put them to maximum use. Nigeria has five oil refineries, but only two are performing at full capacity, which is not enough to meet local consumption.

It is also worrisome that the country still imports food to supplement local production. Experts say any country that cannot come close to food self-sufficiency cannot talk about economic growth.

The fall in the oil prices in the global market has been difficult for oil-producing nations like Nigeria. It is urgent that the country speed up its economic diversification to meet the test.

All these challenges have engaged the administration of President Muhammadu Buhari, who in March became the first Nigerian president to unseat an incumbent at the ballot box. Buhari has vowed to turn things around.

The new president has vowed to deal a decisive blow to corruption, which has seriously impeded the economy.

"If we do not deal with corruption now, corruption will deal with us later," he has said.

Anti-graft agencies have been strengthened and targets for implementation are being put in place.

His recent threats to go after public officials suspected of corruption is producing results. More than 150 billion naira ($750 million) stolen from the national treasury has been returned and more people are expected to give back ill-gotten gains before the deadline.

The administration has promised to create an environment to better encourage investments, and there is reason to think that this is more than just talk.

The author is head of foreign operations at the News Agency of Nigeria. The views do not necessarily reflect those of China Daily.

(China Daily Africa Weekly 09/25/2015 page7)