Director-General, the Lagos Chamber of Commerce and Industry (LCCI), Dr Chinyere Almona, has said the burden of a constrained real economy and tense business environment weakened key sectors of the economy, including manufacturing and agriculture.
 
Reacting to a report from the National Bureau of Statistics (NCS), that the real sector’s Gross Domestic Product (GDP) crashed by over 90 per cent this year, Almona said beyond the statistics, the economy needed to witness a sustained boost in production to support the relevant fundamentals.
 
Urging targeted fiscal interventions to support manufacturers and farmers, she lamented that with high interest rates, inflation, energy costs, insecurity and foreign exchange illiquidity for imported raw materials, the operating environment was unbearable for businesses.
 
She also urged sustained targeted interventions like import waivers, tax exemptions, efforts toward achieving zero fuel importation and a fixed import duty exchange rate to allow for better business planning.
 
Instead of rate hikes, she called for more investments in infrastructure, a boost in oil production to supply enough crude to local refineries and support for the production base of the economy through cost-saving interventions.
 
“Insecurity is still a huge problem. With the increase in revenue generation, saved funds from subsidy removal and the move towards a zero-fuel import era, we expect massive investment in power, transportation, security and agricultural infrastructure to boost food production. With these investments must come an enabling business environment driven by policy consistency, the right regulatory frameworks and the will to drive reforms to fruitful conclusions,” she said.
  
The DG called for full deregulation and implementation of the Petroleum Industry Act (PIA). This, she said, will create a better managed oil and gas sector capable of attracting needed investments and creating more jobs as more operators enter the market and boost oil production output. 
 
According to Almona, all these mean less pressure on FX demand and more FX earnings to the government. Expressing optimism that the controversies surrounding business relationships in the oil and gas sector were gradually dissipating, bringing a sense of stability to the industry, she regretted that the confusion and disruptions experienced in recent months significantly impacted the economy and might require time to resolve fully.
  
On recent increases in fuel prices, which she said left businesses struggling to cope with escalating energy costs, Almona said the rising costs rendered many products uncompetitive due to unaffordable consumer prices.
 
She further pointed out that energy price hikes remained a significant driver of Nigeria’s headline inflation, which stood at 33.88 per cent as of October 2024, further straining the economy and households.
 
With the Monetary Policy Rate (MPR) at 27.50 per cent, inflation at 33.88 per cent, a depreciated currency trading above N1,690/$1 and an unemployment rate of 4.3 per cent, she said “the future of businesses is endangered.”
 
Commending the recent reduction in petrol prices facilitated by Dangote Refinery, the DG said the development reflected a significant demonstration of capacity and readiness to meet local petrol demand, offering much-needed relief amid prevailing economic challenges.