The Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) has raised the alarm over a bleak 2017, noting that except capital expenditures for infrastructural development and the high level of unemployment is addressed, Nigeria might not come out the present downturn in 2017.
The National President, NACCIMA, Dr. Bassey Edem, explained that the monetary and fiscal policies of the federal government were yet to generate the economic activities required to bring about the expected turnaround of the country’s economy, urging the federal government to assess the current economic policies so as to aid in the design and formulation of policies in the coming years for the benefit of the citizenry.
Edem, who spoke during a press briefing on the state-of-the-economy and the association’s perspective on some trending socio-economic issues, pointed out the need to bring down the inflation rate to about 12 per cent, while also calling for a single digit interest rate to stimulate the real sector of the economy.
“I do not see Nigeria coming out of recession completely in 2017. I think by the fourth quarter of next year, if all what we recommend is implemented such as the capital expenditure put forward in the budget and job opportunities are created, we will be on the right path to get out of recession.
“We acknowledge the work of federal government in ensuring that special intervention funds are available to business operators at single-digit rates. However, we counsel that the conditions required to access these funds be revised to facilitate increase in the number of business operators that can access them,” he added.
He, however, called for a review of the composition of Nigeria’s economic team to include representatives of the Organised Private Sector (OPS), noting that this is the way to go in order to formulate policies that would take the nation’s economy out of the woods.
Edem said the Nigerian economy must carry along the private sector in policy formulation processes since the OPS has been proven to be an engine of economic growth in most developed economies of the world.
“It is now time for the federal government to reconstitute the economic team. The economic team is made up of only the public sector, but the Nigerian economy is not for the government alone, but for Nigeria as a whole. The private sector must be carried along in policy formulation. Engaging the private sector is different from being involved in the policy formulation process. One or two members of the private sector must be injected in the economic team so whenever economic policies will be set, they will tell the economic team where it pinches them. We believe if this is done, it will help us not to repeat the errors of 2016.”
According to him, the past six months has remained bleak , but he however stated that there are a few encouraging signs with the foreign reserves increasing steadily since mid-October according to the 30-day moving average report of the Central Bank of Nigeria (CBN).
He added that year-on-year inflation stands at 18.48 per cent while global price of crude oil increased marginally with the Organisation of Petroleum Exporting Countries (OPEC) daily basket price currently at $51.99.
On the macro-economic indicators of the economy, he said the flexible exchange rate policy introduced by the CBN has provided mixed results whereas the official market rate of the naira to the US dollar stands at N305, while the parallel market rate hovers between N450 and N482.
He commended the present administration’s efforts geared at the revival of the Export Expansion Grant (EEG), saying that it is a very vital incentive that will aid the stimulation of export oriented activities leading to significant growth of the non-oil export sector.
He said the level of implementation of the 2016 budget as noted by the President, Federal Republic of Nigeria, Muhammadu Buhari, is not satisfactory, but however acknowledged the late passage of the budget as part of the major causes.
He advised that all arms of government must ensure that the process of budget passage are fast-tracked while observing the required due dilligence to ensure a workable 2017 budget.
“It is important that government should consolidate on its transparency and accountability efforts in order to maintain the zero-based budgeting methodology as noted by the President,” he stated.
He added that in order to achieve the desired recovery and growth as targeted in the 2017 budget, government needs to ensure that there is a lot of manufacturing activity to boost the economy through the provision of infrastructure, access to foreign exchange and improving the ease of doing business within the sector.