A News Analysis by Ibrahim Mammaga, News Agency of Nigeria (NAN)
Lagos State Governor Babajide Sanwo-Olu on his twitter handle on June 18, described the economy of the state “as the fifth largest in Africa’’.
Sanwo-Olu announced this during a meeting with President Muhammadu Buhari on how the Federal Government and Lagos could work together.
“Even with our status as the fifth largest economy in Africa, we still have a lot of room for economic growth, business environment transformation and infrastructure development,’’ he stressed.
Similarly, Sanwo-Olu’s predecessor, Mr Akinwunmi Ambode once said “Lagos is the future citadel of entrepreneurship in this country with a GDP more than those of 42 African countries put together’’.
Ambode is always referring to this claim in spite of the rating of the International Monetary Fund (IMF).
He also restated this in Oct. 31, 2016 that the state ought to be the fifth largest economy in Africa while receiving a delegation from the Nigerian-British Chamber of Commerce.
“In the matter of ranking, Lagos and Kano are critical, with Lagos having the edge; so, it is no longer a guess work; that means if Lagos State today were to be a country, we are the fifth largest economy in Africa,’’ he said.
Ambode claims that Internally Generated Revenue (IGR) in Lagos, mainly through taxes, had hit 1.3 billion dollars in 2015 — 39 per cent of the total IGR by Nigeria’s 36 states then.
He recalls that Lagos State was rated as the fifth largest economy in Africa in 2017 with GDP of 136 billion dollars, bigger than those of Kenya and Ghana.
However, the International Monetary Fund (IMF) latest World Economic Outlook report indicates Nigeria, with GDP of 376.284 billion dollars, as the largest economy in Africa, South Africa is second-largest with a GDP of 349.3 billion while Egypt is third with GDP of 237 billion dollars.
According to the report, Algeria, which occupies the fourth place in Africa, has a GDP of 178.287 billion dollars and Angola in fifth position with a GDP of 124.209 billion dollars.
Angola, which is placed in the fifth position by in IMF rating, has a GDP of 124 billion dollars, which is 12 billion dollars lower than that of Lagos.
IMF also confirms that with a GDP of about 136 billion dollars in 2017, Lagos State is already acclaimed to have the seventh-largest GDP in Africa.
The state government believes that if it is not rated the fifth-largest in Africa presently, it aspires to become the third-largest by 2020.
Experts observe that with improved security of lives and property, atmosphere that is conducive for investment, improved supply of electricity, water, road network and other social amenities, the state would in the near future be among the biggest economy in the world.
They cite the rapidly expanding new city of Lekki, a huge industrial project site, the oil refinery, with a capacity of 650,000 barrels a day.
According to economists, Lagos State has expanded physically, driven by vital reforms in state services such as taxation, transport services and waste management.
They note that Lagos State remains the economic hub of Nigeria 25 years after it was replaced as the country’s official capital.
An analyst and resident of Lagos State, Mr Rasak Musbau, recalls that since the return of democratic dispensation in 1999, successive administrations in state have made efforts at boosting IGR through the implementation of a viable and sustainable tax system.
“With about N600 million in 1999, when Asiwaju Bola Tinubu took over, the IGR rose to between N10 billion and N11 billion by 2007 when he left office.
“With continuing reforms in the internal revenue system, by 2015 when Mr Babatunde Fashola left office as the state governor, IGR has been raised to about N23 billion monthly,’’ he observes.
He, therefore, calls on governments across the country to borrow a leaf from Lagos State and be committed to expanding their tax net, updating/upgrading of databases, improvement of administrative processes and operational efficiencies of their tax agencies.
