2025 Budget: OPSN Commends FG’s Intention to Fund BOI, BOA with N1.5trn

•Canvasses exemption of manufacturers, real sector operators from 4.0% FOB import levy

Dike Onwuamaeze

The chairman of Organised Private Sector of Nigeria (OPSN), Hon. Dele Oye, has commended the federal government’s decision to utilise the N1.5 trillion it is seeking to add to the proposed 2025 budget to fund the Bank of Agriculture (BOA) and Bank of Industry (BOI).

Oye said the move would improve productivity of the Nigerian economy. He appealed to the federal government to exempt manufacturers in implementation of four per cent levy on Free On-Board (FOB) value of imports in accordance with the Nigeria Customs Service Act (NCSA) 2023. 

The FOB charge, according to the Nigeria Customs Service, is calculated based on the value of imported goods, including the cost of goods and transportation up to the port of loading.

Oye expressed the views yesterday when he appeared on the Morning Show of Arise News Television.

He said, “We heard on Wednesday that the government is increasing the budget by N1.5 trillion. The good news there is that it is going to be used to support the Bank of Agriculture (BOA) and the Bank of Industry (BOI).

“The OPSN has been crying that these institutions should be properly funded so that we can have credits at reasonable single digit interest rates to support the productive sector.”

Oye, who is also the national president of Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), asked the government and Central Bank of Nigeria (CBN) to put a cap on public borrowings and reduce the Monetary Policy Rate (MPR), so that there will be more money for the private sector.

“What we are asking for is reasonably priced loans and this economy will move,” he said.

Oye stressed that it was important for the government to consult OPSN before carrying out polices that affected their businesses.

He said, “On Wednesday we saw an announcement that the customs are going to commence charging four per cent on FOB for goods coming into Nigeria.  

“But I will appeal, the government should suspend that for now or at least direct it on people who are importing luxury goods.

“Any person that is in production and using FOB as raw materials should not be saddled with the four per cent. It used to be one per cent until the NCSA of 2023 hiked it to four per cent.

“We are asking that there should be no addition to our cost of production.”

Oye also urged the government to ensure that operations of the Free Trade Zones (FTZs) in Nigeria were made as competitive as those in neighbouring countries, such as Ghana.

According to him, the FTZs are major catalysts in economic growth and “if we make them as competitive as in neighbouring countries, like Ghana and others, they will be another easy way to grow the economy”.

He said the government should be worried whenever banks were doing very well while the industrial sector was collapsing.

Oye described the Nigerian economy as a largely rent seeking economy, where banks made huge profit on high interest rates they were getting from government, pointing out that “almost 25 per cent of the federal government’s budget is going into interest payment”.

Oye also warned that increasing taxation in order to enhance public revenue without improving production would leave everyone naked, eventually.

He said, “The best sustainable way is not more taxes but creating an environment where investments could flow freely.

“We have to make Nigeria more competitive than its neighbours for us to be the destination for businesses. Promoting productivity and not taxation is the way to go.”

He identified reasonable regulations, access to single digit loans, stable foreign exchange rate of N1000/dollar, and improved stakeholders’ engagement as necessary ingredients for promoting economic productivity in Nigeria.

According to him, “If we have these, the government can relax and collect its taxes. If Naira is well priced inflation will be tamed and agitations for more wage increases will stop.

“So, government should not be the one fuelling inflation through taxation and sanctions. 

“Government should be a catalyst for investments by providing reasonable regulations and environment for people to do business.

“It should support local production and local industries to become global players. 

“We want lower exchange rate of N1000/dollar to bring down inflation and enable manufacturers to clear their unsold inventories.” 

He also urged government to appoint ambassadors because their absence was affecting businesses negatively.