The Lagos Chamber of Commerce and Industry has said that with the excruciating burden of debt service, subsidy payments, and worsening insecurity, many more production activities may be constrained in the coming months.
The President, LCCI, Asiwaju Michael Olawale-Cole, stated this during the chamber’s quarterly economic outlook press conference in Lagos.
According to the chamber, the growth of 1.2 per cent recorded for agriculture and three per cent for manufacturing were comparatively low compared to other sectors that grew above five per cent.
Olawale-Cole said this indicated the threats facing the sectors that power Nigeria’s real sector. The woes in the two sectors were responsible for the frightening rise in our inflation rate, he noted.
On the recently presented 2023 budget, the LCCI said the N20.5tn ($47.3bn) proposed expenditure by the Federal Government to run the economy in 2023 reflected the vast needs in critical sectors of the economy.
He said it was comforting that the 2023 budget was still at the proposal stage, adding that all well-meaning stakeholders needed to make constructive inputs to the presidency and the National Assembly.
He said, “Can we consider more efficient alternatives to new borrowings? Can we issue equity to finance the deficit instead of using debt? Can we break the path in which the Federal Government only approaches the debt markets at home and abroad and never approaches the equity market at home or abroad? Investors invest in debt but they also invest in equity.
“Our approach should not be to continue issuing only debt, especially with the increasingly unbearable burden of interest payments that exposes our fiscal vulnerability.”
He added, “We can improve the performance of the 2023 budget by studying how the 2022 budget has performed. Looking at what has worked well, what failed, and what must be corrected in the implementation of the 2023 budget.”
The LCCI president noted that particular attention must be put on investing more in transport infrastructure to resolve the many logistical challenges that have impacted the movement of goods across the nation.
He added, “Looking beyond oil revenues, we can enhance our forex earnings through the increased inflow of foreign direct investments. We need to invest more in infrastructure and critical port reforms to reduce the bottlenecks in our export logistics and processes that will boost non-oil production and exports.”
