Can the economic problem of Nigeria be solved?
By Olamirewaju Olatunde
Taking Nigeria out of its unfavourable state to a favourable state – addressing budget deficit, balance of payment in relation to foreign policy. A government that owes international countries will be forced to pursue foreign policy toward other countries that will be detrimental to the country.
The purpose of this article is to outline strategies for assisting Nigeria in paying off its obligations to other nations so that it can pursue an international agenda that serves its own interests. Nigeria can pay off its head debt first. Increasing exports while lowering imports is one of the key strategies for achieving this.
The Nigerian government borrows money from other nations to finance its budget since its spending much outweighs its profits. Nigeria’s imports outweigh its exports, causing a balance of payments imbalance that makes it harder and harder to borrow money to cover our budget. The best strategy to determine which products Nigeria should export is to look at those in which the country has a stronger comparative advantage (i.e., those with the lowest opportunity cost relative to other nations). The country’s foreign reserves will increase with increased exports, which will aid in funding national spending. It is possible to fix this, though.
One of the most important ways to address this is to ensure expansionary supply side policy. This entails adopting measures such as infrastructure construction, corporate subsidies, and so on to help expand the overall amount of goods and services in the country. As a result, this might contribute to a rise in GDP (economic growth), which can result in exports of goods and services once domestic demand has been satisfactorily satisfied. Increased exports generate more cash to cover budgetary expenditures and debt repayment.
Also, expansionary fiscal policy can be implemented. Fiscal policy involves the use of tax and expenditure to regulate the economy. When progressive tax system is employed the economy is likely to experience less income inequality.
The money received from the taxes of monopolists in the country can help increase the amount of revenue received which can help increase the profit of the government and help regulate the economy of Nigeria.
In conclusion, these are some of the methods Nigeria can implement to help ensure a balanced economy. Taking off the debts of a country helps to ensure the achievement of the national interest of Nigeria leading to the benefits of all citizens in the country.
