Inflation, insecurity, forex top issues OPS wants FG to address

As the country commemorates another year of independence, members of the organised private sector of the Nigerian economy have urged the Federal Government to address lingering macro-economic issues to ensure that the private sector, especially manufacturers, contribute meaningfully to the economy.

According to the OPS, the quality of the business environment remains a source of concern to investors, especially in the real sector.

They noted that weak infrastructure, policy environment, and institutions continue to have adverse effects on the efficiency, productivity, and competitiveness of many enterprises in the economy.

The OPS, comprising the Lagos Chamber of Commerce and Industry (LCCI), the Nigerian Association of Chamber of Commerce, Industry, Mines and Agriculture (NACCIMA), and the Centre for the Promotion of Private Enterprises (CPPE) in their respective messages to commemorate Nigeria’s 61 years independence anniversary, expressed these concerns and sought government’s intervention in addressing them.

The Director-General of the LCCI, Dr. Chinyere Almona, stated that the risk of investing in the manufacturing sector of the country’s economy has grown progressively in recent decades largely because of the poor quality of infrastructure.

She said: “Unless there is effective and sustained protection and support for the sector, and a dramatic improvement in infrastructure, the outlook for the sector will remain gloomy, particularly for the small-scale industries. Most SMEs are yet to recover from the impact of the COVID-19 pandemic that struck last year.

“For most manufacturing SMEs, it is a nightmare. Yet production is critical to enduring economic and social stability. The way forward is to address the fundamental constraints to manufacturing competitiveness in the Nigerian economy. Perpetual protectionism without supported mass local production cannot fix this problem.”

An Economist Chief Executive Officer of the CPPE, Dr. Muda Yusuf, acknowledged that some sectors of the Nigerian economy, have been significantly transformed over the past 61 years, but identified the need for urgent steps to be taken to ensure a better macroeconomic management framework to stabilise the exchange rate, eradicate the challenge of illiquidity in the foreign exchange market and to stem the current depreciation of the Naira.

Yusuf noted that the country’s macroeconomic management framework has continued to pose serious challenges to investors in the economy and recommended that, “the international trade process needs to be reformed to prioritise trade facilitation. Therefore, the orientation of the Nigeria Customs Service, Nigerian Ports Authority, the shipping companies and the terminal operators and the security agencies at the ports need to change in favour of investment-friendly international trade processes.”

The National President of NACCIMA, John Udeagbala, said that the celebration of Nigeria at 61 came with mixed feelings as the country is still facing numerous economic and social challenges.

Udeagbala said that the Nigerian economy today is faced with a high inflation rate, high unemployment rate, low growth rates, mounting local and foreign debt, and a depreciating currency while still largely being import-dependent.

He attributed the current state of the economy to the government’s habit of initiating and implementing reform policies too late and counteracting their positive effects with different policies

Udeagbala said that an example of belated policy intervention was the long time it took the government to package and commence the implementation of its Economic Sustainability Plan to counter the impacts of the COVID-19 lockdown measures on the Nigerian private sector.

He added: “An example of the second is the current implementation of policies in the foreign exchange market that totally negate any benefits or relief that may have been obtained by the implementation of the ESP.”