KPMG Nigeria, a leading economic research and consultancy services provider, has reported that most corporate Chief Financial Officers (CFOs) are not optimistic about Nigeria’s economy recording a significant growth this year.
In the firm’s just published ‘The 2023 Annual CFO Outlook Survey’ report about 31 Chief Financial Officers (31%) expect Nigeria’s economic growth to decline in 2023 while 41% of them believe there will be no significant growth at all.
According to the report, most of the CFOs hinged their unimpressive economic growth forecast on the delay in fuel subsidy removal, uncertain foreign exchange environment, high inflation rate, insecurity, and tax and regulatory posture.
For instance, one of the respondents and Citibank Nigeria’s CFO, Mr. Sharafadeen Muhammed, was quoted as saying that “fiscal policy has been under pressure recently and removal of oil subsidy would help greatly in providing headroom for the government coffers to enable the provision of development benefits to citizens.”
A further analysis of the survey findings showed that 52% of the CFOs surveyed had little confidence in the growth prospect for their industries as they identified inflation rate, global economic slowdown, and general economic uncertainty as reasons for the gloomy outlook.
KPMG recalled in the report that Nigeria’s headline annual inflation rate sustained its upward swing all through 2022, reaching its highest level in almost two decades due to lingering structural issues, rising international food and energy prices and other policy-related bottlenecks that impact the cost of doing business.
According to the research firm, the CFOs advised the incoming administration to frontally address the sundry micro and macroeconomic challenges constraining businesses in order to stimulate growth and increase investor and public confidence in the economy.
Also, it listed some of the major issues that would impact on the nation’s economy this year as including fuel subsidy, inflation, global economic slowdown, 2023 general elections, tax and other fiscal policies, increased regulation, uncertain foreign exchange environment, emerging digital economy, power challenges and insecurity.
The Annual CFO Outlook Survey by KPMG Nigeria highlighted critical information on the perception of the CFOs and organizations about the prevailing business environment, their expectations of government/policymakers, and their strategies to cope with the challenges in the operating environment.
