Thursday , February 6 2025
Nigeria's 2025 Economic Prospects Hinge on Rebasing, Tax Reforms - Taiwo Oyedele

Nigeria’s 2025 Economic Prospects Hinge on Rebasing, Tax Reforms – Taiwo Oyedele

…Key to Boost Investor Confidence, Drive Economic Growth

 

Nigeria’s economic landscape is poised for a significant transformation in 2025, driven by the planned rebasing of the nation’s Gross Domestic Product (GDP), according to Dr. Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms.

Speaking at the Lagos Chamber of Commerce and Industry (LCCI) 2025 Economic Review and Outlook Conference, Oyedele outlined how this statistical recalibration, coupled with key fiscal reforms, is expected to reshape investor perception and provide a clearer picture of Nigeria’s economic health.

Oyedele emphasized that the rebasing exercise, which will shift the base year for GDP calculations from 2010 to 2019, is not merely a technical adjustment. It represents a fundamental shift in how Nigeria’s economic performance is measured and perceived. By incorporating more recent economic activity and structural changes, the rebased GDP will offer a more accurate reflection of the country’s current economic size and composition.

“Rebasing the economy gives a signal to investors to have second thoughts about the country and take investment in the country more seriously,” Oyedele stated. He explained that the exercise will have a direct impact on key economic indicators, including the tax-to-GDP ratio and per capita income, providing a more realistic assessment of Nigeria’s fiscal capacity and standard of living. This improved clarity, he argued, will be crucial in attracting foreign investment and fostering sustainable economic growth.

The Chairman also highlighted the broader context of fiscal reforms accompanying the rebasing. He noted that 2025 will witness significant changes in budget processing, the medium-term expenditure framework, and the fiscal strategy paper. These reforms are designed to complement the rebasing exercise and ensure that fiscal policy is aligned with the new economic reality.

Beyond GDP, Oyedele revealed that the Consumer Price Index (CPI) basket, used to measure inflation, will also be rebased. This adjustment will provide a more accurate and up-to-date measure of price changes in the economy, giving policymakers a clearer understanding of inflationary pressures. Furthermore, he hinted at the potential introduction of a producers’ cost index in 2025, which would provide valuable insights into production costs and further refine inflation measurement. This new index would also offer a more reliable survey on inflation, impacting sales and measuring monetary policy interventions more effectively.

Oyedele expressed optimism about Nigeria’s economic prospects in 2025, predicting a moderation in inflation and greater stability in the foreign exchange rate. He attributed this positive outlook to the anticipated dissipation of factors that have driven up costs in recent times, coupled with increased foreign exchange inflows into the federation account.

The ongoing tax reform efforts also featured prominently in Oyedele’s address. He assured the audience that significant progress is being made in engaging with key stakeholders on the tax reform bills, with enactment expected by the end of the first quarter of 2025. These bills, he explained, contain provisions with significant potential for Nigeria, ranging from business reforms and cost reductions to ensuring a more conducive environment for small businesses.

“There are significant provisions in the tax reform bills that hold possibilities for the country from business reforms to cost and tax reduction, while ensuring that small businesses can thrive without excess burdens,” Oyedele affirmed.

Oyedele concluded with a strong message of optimism, stating, “I am positive about 2025 and what it holds for businesses, families and individuals, and by complementing the other sound fiscal policies by the Federal Government, I think it can only get better.” He positioned the rebasing exercise not as an isolated event, but as a crucial component of a broader strategy to reposition Nigeria’s economy for sustainable and inclusive growth.

 

About Bukola Olanrewaju

Check Also

Court Orders Arrest of Access Bank Acting MD, Others over Alleged Theft of Property

Court Orders Arrest of Access Bank Acting MD, Others over Alleged Theft of Property

Justice Ibironke Harrison, Judge of the Lagos State High Court, has ordered the arrest of …

Leave a Reply

Your email address will not be published. Required fields are marked *