By Yemisi Izuora-Lagos
The Nigerian Association of Chamber of Commerce, Industry, Mines and Agriculture (NACCIMA) has predicted that the national economy will move at a snail pace by 2015 due to dwindling oil price.
The association said that high uncertainty continues to prevail in the real sector remains considering perceived effects of policies being initiated and implemented by government.
According to NACCIMA, indicators from budgetary provisions and oil benchmarks as well expected cost-push inflation on consumer goods show that the budget is not in tune with reality while little attention is being given to the economy in the face of elections.
Similarly, with the commencement of the ECOWAS Common External Tariff (CET) in January 2015, the chamber expressed concerns on the effect of ignoring compliance to all protocols signed by ECOWAS member-countries as well as the ECOWAS Trade Liberalisation Scheme (ETLS), considering the prevailing pressure on naira that has further made locally produced goods uncompetitive.
At a media briefing on the review of the state of the nation in Lagos the National President, NACCIMA, Alhaji Mohammed Abubakar stated that the nation remains beset with so many challenges arising from falling crude oil prices, which have precipitated the proposed austerity measures and devaluation, while insecurity in the North-East remains a serious challenge in the face of the fast-approaching 2015 election.
Abubakar who was represented by the Chamber’s 1st Deputy Vice-President, Bassey Edem explained that the macro-economic indicators show a disparity in the state of affairs of the nation’s economy and citizens’ well-being.
While the challenges abound, the chamber noted that the country might have to depend heavily on local manufacturers that source their raw materials locally without exposure to the forex market.
He said: “The falling price of crude oil is expected to affect the price of imported commodities like the premium motor spirit and the likes, but the real sector remains heavily affected.
“Slow-paced growth should be expected till after elections. But with early budget implementation, there is a lot to be done. The economy should not be ignored in the face of elections. The first quarter may be rough but the effect should be mitigated.
“Similarly, government may need to increase concentration on areas where the country has comparative advantage in a bid to encourage diversification.
“ We urge government to ensure an improved collaboration between the public and private sectors and government’s sincerity in facilitating a private sector led economy, which will enable Nigeria to maximally utilize her abundant resources.
“ Also, government should provide a climate for a profitable and flourishing business enterprise. In this regard, the first and most critical area of attention is to intensify its transformation agenda on infrastructure. With this, cost of production will reduce, unit prices will reduce and our goods will be able to compete internationally.
“Government should address other areas that effectively raise the cost of doing business, such as excessive tax burden, high cost of compliance with government regulations and Extortion/harassment of companies by regulatory agencies.
“Government should examine the various incentives and harmonize them appropriately. The ineffective ones should be abolished while others should be fine-tuned to make them practicable and realistic. In this wise, the abolition of Duty Draw Back Scheme is commendable, and the fine-tuning of the Export Expansion Grant will be a step in the right direction”.
On his part, the President, Lagos Chamber of Commerce and Industry (LCCI) and ex-officio of NACCIMA, Alhaji Remi Bello urged economy managers to mitigate cost-push inflation expected in 2015, especially as the cost of doing business continues to rise.
“The 2015 budget is not in tune with reality. We are starting on a false note. It is going to be a challenging 2015, but we will survive it”, he added.