Many Capital Projects In States Lack Growth Impact—NESG

The Nigerian Economic Summit Group (NESG) has called for targeted and inclusive interventions to address challenges facing Nigeria’s informal sector as part of ongoing economic reforms.

The Chief Economist and Director of Research and Development, NESG, Dr Olusegun Omisakin, made the call during a virtual media interactive session.

He said the informal segment, which accounts for a significant share of economic activity, remained largely outside the reach of government policies and support programmes.

Omisakin noted that while policy implementation within the formal sector was relatively straightforward, engaging informal operators required more deliberate, data-driven and inclusive strategies.

“One of the major challenges the government faces is the informal economy. It is not just about production, but also about how interventions reach those whose activities are not directly captured.

“It is easy to reduce taxes or implement policies within the formal system, but when it comes to the informal segment, where operations are not directly tracked, it becomes more difficult,” he said.

He stressed the need for stronger coordination between fiscal and monetary authorities to ensure that economic policies deliver desired outcomes.

According to him, inflation remains a major concern, with significant implications for household welfare and business sustainability.

“We have consistently advocated policy coordination so that fiscal and monetary measures work towards a common goal.

“Inflation is extremely high, and the priority is to bring it down through well-aligned and sustained policy actions,” he said.

Omisakin also highlighted the importance of social protection programmes, efficient public spending and critical infrastructure investment in easing economic pressures.

He noted that improved infrastructure, particularly rail transport, could significantly reduce logistics costs and enhance productivity across sectors.

The economist further called for improved transparency and accountability in public finance management at the sub-national level.

He urged state governments to adopt more strategic approaches to capital expenditure, noting that while personnel costs remain obligatory, capital investments should be geared towards stimulating growth and generating returns.

“States must be intentional in utilising capital expenditure to deliver sustainable economic outcomes.

“Regular publication of budget implementation reports and financial statements will also enhance transparency and public trust,” he said.

Omisakin acknowledged recent improvements in capital spending by some states, citing supporting evidence from international assessments.

He, however, maintained that Nigeria’s economic recovery would depend on sustained reforms, inclusive policies and long-term planning.

He reaffirmed the commitment of the ground to providing independent, evidence-based policy advice, emphasising that its role is to support the government with practical solutions rather than offer blanket criticism.