SAN FRANCISCO, October 07, (THEWILL) – The Lagos Chamber of Commerce and Industry (LCCI) has advised policy makers on the formulation and implementation of policies to facilitate sustainability as business operators grapple with the devastating impact of the COVID-19 pandemic.
Mrs Toki Mabogunje, President, LCCI. gave the advice at a press conference on the state of the economy saying such policies must support businesses, protect jobs, preserve investment and foster economic competitiveness at both national and subnational levels.
She said that the chamber endorsed the adoption of the cost reflective tariff regime in the power sector, while noting the push back by the labour unions on the policy.
The LCCI president said that the cost tariff regime was inevitable to attract investment and improve power supply, though safeguards were needed to protect consumers from exploitation.
“If the economics of the investment is not right, investors will not inject capital into the sector.
“However, there should be safeguards to protect consumers from exploitation.
“There should comprehensive metering of consumers and there should be value for money.
“We believe that policy should be given a chance,” she said.
The LCCI president said that the Solar Home Initiative, aimed at expanding energy access to 25 million individuals through the provision of solar home systems or connection to a mini grid, was a step in the right direction.
She said that the initiative would stimulate growth and productivity in the country’s rural economy.
Mabogunje commended government on the recent reforms implemented in the downstream segment of the oil sector.
She added that the removal of subsidy on Premium Motor Spirit and the proposal of the Nigerian National Petroleum Corporation (NNPC) to give up majority stakes in the four local refineries were laudable.
Mabogunje, however, appealed for the provision of mass transit buses, development of rail system for intra city and intercity transportation, and the acceleration of the auto gas programme so that more vehicles could be powered by gas.
“We believe these measures are steps in the right direction in rescuing the economy from deepening fiscal crisis.
“We note that the subsidy regime had for long constituted a huge burden on public finances, encouraged corruption, inefficiencies, deterred investment flows, and weakened the earnings performance of oil refining and marketing companies.
“We acknowledge the effect of the price hike on the vulnerable segments of the society, accordingly, we request that palliatives be provided in form of mass transit buses among other initiatives to ease the burden on consumers,” she said.
Mabogunje also called for the expeditious passage of the Petroleum Industry Bill (PIB) to consolidate recent reforms in the sector.
On the various fiscal and monetary interventions by the government, Mabogunje said the schemes would help with fulfilling payroll obligations and help protect the jobs within the SMEs sphere.
She, however, said that special attention be given to sectors severely impacted by the pandemic.
“The Lagos Chamber acknowledges the various interventions of the fiscal and monetary sides of authorities in mitigating the adverse impact of the pandemic on economic and business environment.
“The federal and state governments need to expeditiously redirect attention to these sectors including aviation, hospitality, entertainment, and manufacturing.
“This has become necessary to protect jobs, preserve investments and provide the much-needed liquidity required to revive these sectors.
“The Lagos Chamber calls on the fiscal and monetary authorities on the need to synergize to moderate domestic prices to a level conducive for sustainable and inclusive economic growth.
“The Federal Government might need to reopen the land borders to give succour to food prices in the light of lower domestic food supply amid huge demand for food.
“Similarly, both the Federal and State Governments also need to promptly address the issue of food wastage, majorly responsible for the food supply gap being experienced in the country.
“Government intervention and private sector investments are needed to enhance mechanization as well as storage to minimize post-harvest losses,” she said.
Mabogunje also expressed concern over the nation’s rising debt profile of N31trillion which she said was without corresponding impact on output growth and economic development.
According to her, the growing level of the country’s debt was fast becoming unsustainable in the light of dwindling oil prices and production.
She said that the high level of debt servicing continued to hinder robust investments in hard and soft infrastructure, which were key to stimulating productivity and improving living standards.
