The Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture has urged economic policymakers to take urgent actions with regard to fixing Nigeria’s economic challenges to prevent the economy from sliding into recession.’
NACCIMA President, John Udeagbala, stated this on Thursday during the Chamber’s state of the economy press conference in Lagos.
The Chamber noted that the economy had now surpassed the highest rate of inflation ever recorded of 18.17 per cent in March 2021.
According to Udeagbala, the high rate of unemployment in Nigeria was of major concern to the Organised Private Sector, considering that the 33.3 per cent rate of unemployment often quoted, was a statistic that was two years old and did not take into full consideration the impact of the COVID-19 pandemic and the conflict in Europe on the Nigerian labour market.
He said, “Ladies and Gentlemen, to provide some context, we start this briefing by expressing our grave concern about the state of the economy as we acknowledge the positive growth statistics published by the National Bureau of Statistics for the Second Quarter of the year, 2022.
“Our concern is based on the possible false sense of security that this statistic may create, as the second quarter of 2022 may not fully capture the supply and value chain disruptions brought about by the COVID-19 pandemic and the Russia-Ukraine conflict.
“We, therefore once again, urge policymakers to take urgent action to avoid economic recession.”
On Nigeria’s growing debt profile, Udeagbala said it was now very obvious that the current levels of debt were unsustainable, as the International Monetary Fund projected that by 2026, all of Nigeria’s revenue would go to servicing debt.
“As we consider that the National budget is heavily skewed towards recurrent expenditure that is largely unmet by the estimated government revenue, we counsel all levels of government to consider other sources of funding, such as leveraging public-private-partnerships for tax credits spread over time. The economy cannot run based on increasing the number of taxes borne by the private sector, as we have witnessed by recent laws passed by the National Assembly, and we advocate policies that systematically and consistently increase the tax base in terms of the volume of production or the number of taxpayers.”
The NACCIMA president further stated that the power sector was of keen interest to the private sector as it was continually plagued by grid collapse resulting in the instability of power generation, distribution and supply. The alternative source of energy obtained from the oil and gas sector, he said, represented a significant portion of production costs for the private sector.
