AfDB President Adesina Warns Nigeria: Bold Reforms or Economic Collapse
LAGOS, Nigeria – May 2, 2025
African Development Bank (AfDB) President Dr. Akinwumi Adesina has issued a stark warning to Nigeria, urging immediate structural reforms to address chronic power deficits, infrastructure gaps, and overdependence on oil exports. Speaking at the 20th anniversary dinner of Chapel Hill Denham in Lagos, Adesina emphasized that Nigeria’s GDP per capita has plummeted to $824, lower than its 1960 independence figure of $1,847, while South Korea’s soared to over $36,000 in the same period.
Critical Challenges Facing Nigeria
- Power Crisis:
- Nigeria’s unreliable electricity grid stifles industrialization, with businesses relying on costly diesel generators. Adesina warned: “Without power, Nigeria’s economy will remain in slow growth”.
- The AfDB’s Mission 300 initiative aims to connect 300 million Africans to electricity by 2030, but Nigeria must accelerate reforms to benefit.
- Infrastructure Deficit:
- Poor logistics, including highways and ports, hinder competitiveness in the African Continental Free Trade Area (AfCFTA).
- Adesina called for mobilizing pension funds and sovereign wealth investments into infrastructure projects.
- Deindustrialization:
- Nigeria’s manufacturing export value per capita is $160, dwarfed by Vietnam’s $3,600 and Malaysia’s $7,100. Adesina lamented the collapse of Nigeria’s auto and textile industries.
Adesina’s Reform Blueprint
- Power Sector Overhaul:
- Implement cost-reflective tariffs, enforceable power purchase agreements, and private sector-led green energy solutions.
- Leverage AfDB’s blended finance to attract investors and build a “21st-century grid”.
- Value Addition:
- Halt raw material exports (oil, minerals, agriculture) and prioritize processing.
- “Exporting raw materials is the door to poverty; value-added products are the highway to wealth,” Adesina stated.
- Agriculture Transformation:
- Scale the $1.3 billion Special Agro-Industrial Processing Zones (SAPZ) to create jobs and reduce rural-urban migration.
- Institutional Reforms:
- Strengthen governance, transparency, and policy consistency to attract investments.
- Adesina cited the Dangote Refinery as a model for private-sector-led industrialization.
Global Context and AfDB Initiatives
- Ending Aid Dependency:
- Adesina declared the “era of free money is over,” urging Africa to embrace self-reliance and strategic partnerships.
- The AfDB is developing a natural capital valuation framework to boost Africa’s GDP and creditworthiness.
- Geopolitical Risks:
- 47 African nations face higher U.S. tariffs, threatening exports and currency stability. Adesina warned of inflation and debt crises.
- Youth and Education:
- With Africa’s population projected to hit 2.4 billion by 2050, Adesina stressed aligning education with digital economy demands.
Political and Economic Implications
- Urgency for Tinubu’s Administration:
- Adesina’s warnings come amid Nigeria’s worsening cost-of-living crisis and labour strikes demanding wage reforms.
- AfDB’s Role:
- Under Adesina, the AfDB’s capital grew from $93 billion to $318 billion, funding projects like the African Adaptation Acceleration Program ($25 billion for climate resilience)
