Corruption in Nigeria could cost up to 37% of GDP if not dealt with immediately, a PwC report has found.
This cost equates to about $1,000 per person in 2014 and will be almost double that by 2030 if corruption isn’t tackled, according to the paper, Impact of Corruption on Nigeria’s Economy.
Since taking office in May 2015, Nigeria’s president Muhammadu Buhari, pictured, has launched an anti-corruption drive.
But low tax revenues (8% of GDP), weak investment – particularly foreign direct investment – and low levels of human capital demonstrate the effects of corruption on the Nigerian economy, the report stated.
It compared Nigeria’s score on Transparency International’s Corruption Perception Index (CPI) with that of Colombia, Ghana and Malaysia, countries similarly high in natural resources, but which have introduced more anti-corruption policies.
Corruption was defined as taking place on three scales, “grand” – at a high level of government, “petty” – everyday abuse by low and mid-level public officials and “political” – manipulating policies and rules of procedures in allocating government resources.
Ghana, Colombia and Malaysia all have similar CPI scores and have introduced a number of anti-corruption policies covering whistleblowing, money laundering, financial services and data protection. They have also introduced measures such as public bodies to monitor, investigate and prosecute any offence involving financial loss to the state.
Had Nigeria introduced the anti-corruption policies Ghana has done over the last 25 years, it would have a higher CPI score and its 2014 GDP could be $113bn or 22% higher, the report stated.
Bringing in anti-corruption measures as Colombia did between 1999 and 2004 could have increased Nigeria’s 2014 GDP by 18% or $93bn. And measures introduced by Malaysia over the last five years could have helped raise Nigeria’s GDP by 36% to $185bn, the report found.
“Corruption is a pressing issue in Nigeria,” the report said. “It affects public finances, business investment, as well as standard of living.”