By Oboh O. S. Jerry

Nigeria’s economic crisis is no longer merely a conversation about inflation, exchange rates, or unemployment statistics. It is now a question of national economic survival and strategic direction. Across the country, citizens are experiencing rising living costs, declining purchasing power, shrinking business margins, and increasing economic uncertainty. In response, government at various levels continues to expand taxation and revenue drives in an attempt to fund public expenditure.

Yet, an uncomfortable truth remains largely ignored: Nigeria cannot sustainably tax its way out of economic hardship.

No economy achieves long-term prosperity by consistently increasing pressure on struggling citizens and businesses while leaving vast institutional inefficiencies and untapped government revenue opportunities untouched. The real issue is not simply whether Nigeria needs more revenue. The deeper issue is whether Nigeria is maximising the enormous economic potential already embedded within its ministries, departments, agencies, parastatals, and commissions.

The truth is that many public institutions in Nigeria are operating far below their economic capacity. Several government agencies possess enormous commercial, technological, licensing, regulatory, training, consulting, and service-delivery capabilities capable of generating sustainable revenues if properly restructured and monitored. Many maintain extensive landed properties, training centres, research facilities, administrative platforms, certification systems, and specialised operational capacities that remain underutilised or poorly managed.

Instead of functioning as strategic economic contributors, many institutions have become heavily dependent on federal allocations and excessive taxation of citizens. This is economically unsustainable.

A serious national reform agenda should therefore focus on two interconnected priorities: optimising government institutions for productivity and protecting Nigerian employment opportunities through strategic labour reforms.

One critical but often ignored aspect of this discussion is the growing dependence on foreign labour across sectors where qualified Nigerians are readily available.

Across construction, oil and gas, manufacturing, telecommunications, consultancy, education, ICT, hospitality, and even development organisations, foreign nationals increasingly occupy positions that many Nigerians possess the competence and experience to perform effectively. In some sectors, expatriate hiring has gradually shifted from strategic necessity to institutional convenience and status preference.

This has serious economic consequences. Every unnecessary foreign hire contributes to capital flight through salaries, allowances, benefits, and foreign remittances sent outside Nigeria. In an economy already struggling with foreign exchange pressures, this continuous outflow weakens the naira and increases dependence on scarce foreign currency reserves.

More troubling is the impact on local employment confidence. Thousands of highly educated Nigerian graduates and professionals remain unemployed or underemployed while organisations continue to recruit expatriates for positions that do not necessarily require rare foreign expertise.

This is not an argument against international collaboration or foreign investment. Every modern economy benefits from global expertise and cross-border knowledge exchange. However, successful economies protect national interests while remaining globally engaged.

Countries such as Indonesia, Saudi Arabia, the United Arab Emirates, Malaysia, and even the United States maintain strategic labour protection policies that prioritise local employment while allowing carefully regulated foreign expertise in areas where local capacity is insufficient. Nigeria can adopt a similar balanced model without discouraging international investment.

A practical and realistic solution would be the introduction of a National Foreign Employment Accountability and Employment Protection Framework.

Under such a framework, all organisations employing expatriates would be required to transparently justify foreign hires, particularly in non-specialist roles. Employers should demonstrate that qualified Nigerians are unavailable for such positions before expatriate approvals are granted or renewed.

This is not an unrealistic proposition. Nigeria already maintains systems for expatriate quotas and work permits. The problem is weak enforcement, poor coordination, inadequate monitoring, and the absence of a broader national employment strategy linked to economic development goals.

The proposed reform can therefore build upon existing institutional structures rather than creating entirely new bureaucracies.

A realistic implementation model could involve collaboration between the:

• National Directorate of Employment 

• Federal Ministry of Labour and Employment 

• Nigeria Immigration Service 

• Federal Inland Revenue Service 

• Nigerian Investment Promotion Commission 

Through integrated digital reporting systems, organisations employing expatriates could submit annual declarations outlining:

• Job descriptions 

• Skills justification 

• Duration of employment 

• Skills-transfer plans 

• Nigerian understudy programmes 

• Localisation timelines 

This would create transparency while helping the government track labour patterns and national workforce gaps.

To further strengthen the system, Nigeria could introduce a Strategic Employment Levy on organisations employing foreign nationals in roles considered reasonably localisable. Critics may immediately argue that such a policy could discourage foreign investment. However, this concern overlooks an important reality: investors are attracted primarily by market size, stability, infrastructure, profitability, and regulatory clarity, not unrestricted access to expatriate labour.

In fact, a transparent and well-structured framework may improve investor confidence because it creates predictable labour regulations rather than arbitrary administrative practices. Importantly, the proposed levy should not be punitive or hostile. It should be strategic, graduated, and sector-sensitive.

For example:

• Highly specialised technical roles unavailable locally could attract minimal or temporary levies. 

• Long-term employment of expatriates in easily localisable positions could attract higher levies. 

• Organisations with proven skills-transfer programmes could receive incentives or levy reductions. 

This transforms the policy from a restrictive measure into a national workforce development strategy.

The revenues generated from such levies should not disappear into general government spending. They should be ring-fenced specifically for:

• Technical and vocational education 

• Youth entrepreneurship programmes 

• Digital skills training 

• Industrial apprenticeships 

• Innovation hubs 

• MSME financing 

• Employment creation schemes under the NDE 

This is where the proposal becomes economically transformative rather than merely regulatory.

Nigeria’s unemployment challenge is not simply a social problem; it is a direct economic threat. High unemployment weakens consumer spending, increases poverty, fuels insecurity, encourages migration pressures, and undermines national productivity.

Protecting Nigerian jobs while simultaneously investing in Nigerian capacity creates a multiplier effect across the economy.

Beyond labour reforms, the larger national objective must remain institutional optimisation.

If ministries, departments, agencies, commissions, and parastatals are strategically restructured for efficiency and revenue generation, Nigeria can gradually reduce excessive dependence on taxation and borrowing.

Several agencies already possess hidden economic potential. Training institutions can commercialise certifications and technical programmes. Research agencies can monetise innovations and consulting services. Regulatory agencies can digitise services and reduce leakages. Government-owned assets can be properly audited and commercially utilised. Public-private partnerships can transform dormant infrastructure into productive economic assets.

A more productive public sector would generate stronger non-oil revenues, improve fiscal sustainability, and reduce pressure on ordinary Nigerians.

The wider economic effects could be profound.

Lower pressure on citizens and businesses means higher disposable incomes. Higher disposable incomes increase domestic spending. Increased domestic spending stimulates local manufacturing, retail activity, entrepreneurship, agriculture, transportation, and service industries.

As domestic productivity rises and capital flight reduces, pressure on foreign exchange markets may gradually decline, supporting naira stability over time.

This is how sustainable development is built, not merely through taxation, but through productivity, institutional efficiency, labour protection, and strategic economic planning.

Nigeria does not lack talent. Nigeria does not lack resources. Nigeria does not even lack institutions.

What Nigeria has lacked is the courage to optimise its systems in ways that place national productivity, local capacity development, and economic sustainability above short-term administrative convenience.

The country must now move from a consumption-driven governance structure to a productivity-driven governance structure.

That transition may be difficult, but it is achievable. And perhaps more importantly, it is necessary.

By Oboh O. S. Jerry (PhD)

Economist & Public Affairs Analyst

jerrysankayoboh@gmail.com