Nigeria's Tinubu aims for a 7% economic growth by the year 2027

On Wednesday, Nigerian President Bola Tinubu set a target to achieve 7% annual economic growth by 2027, aiming to lift millions out of poverty and expand the economy to four times its current size by 2030. Since taking office in 2023, Tinubu has removed petrol and electricity subsidies and devalued the naira twice to boost Nigeria's sluggish economic performance, which has been stagnant for a decade. However, these actions have led to the worst cost-of-living crisis in a generation and have not yet resulted in the expected growth acceleration. In the first quarter, Nigeria's economy grew by 3.13%, supported by a rebasing of its gross domestic product. This adjustment increased the economy's size to 372.822 trillion naira (about $243.55 billion), though the growth rate fell short of expectations. Addressing the federal cabinet, Tinubu stated that the reforms had improved macroeconomic stability and investor confidence, but he highlighted that low public savings present a challenge to growth. He noted that public investment accounts for only 5% of the gross domestic product. "To maintain our momentum, we must optimize every available naira," Tinubu said, instructing his economic team to review revenue retention and deductions from the federal account, including fees charged by agencies such as the tax authority, Customs, and the national oil company NNPC Ltd. The Petroleum Industry Act (PIA) currently allows NNPC to retain 30% of certain revenues for managing oil and gas operations and to deduct 30% of its profits to fund exploration in underexplored frontier basins.