At this year’s Lagos Chamber of Commerce and Industry (LCCI)’s virtual Presidential Policy Dialogue Session held in Lagos recently, the Federal Government and members of the organised private sector (OPS) took time to address salient issues impeding growth in the nation’s business environment as well as proffering solutions. Taiwo Hassan reports
Again, the challenges beclouding the country’s real sector of the economy mostly arising from the emergence of COVID-19 and others were at the front burner during discussions involving the Federal Government and key industry stakeholders at an LCCI 2020 Presidential Policy Dialogue in Lagos.
The attendance included Vice- President, Prof. Yemi Osinbajo, Minister of Industry, Trade and Investment, Otunba Adeniyi Adebayo, LCCI President, Toki Mabogunje, Deputy Secretary General, United Nations, Dr Amina Mohammed, deputy presidents of the LCCI, Asiwaju Dr. Michael Oawale-Cole, and Mr. Knut Ulmveon, amongst others. Expectedly, the negative impacts of COVID-19 on the key sectors of the economy was visibly highlighted with its consequences on trade, supply and distribution value chains, businesses, revenue projections of firms, profits, short, medium and long terms projections of businesses among others.
LCCI’s stance on COVID-19
In her opening speech at the event, the LCCI president, Mabogunje, told the participants that this was the first time the chamber would be holding virtual meeting of the presidential policy dialogue. The president said that these were surely not the best of times for the Nigerian economy and businesses as the effects of COVID- 19 disruptions had been very profound on businesses and the economy in general. She explained that the shortterm outlook of the key economic indicators was not looking bright; but that, however, the chamber was hopeful that “we would turn the corner sooner than later.”
“As we all know, the major trigger of the economic downturn was the COVID-19 induced slump in oil price, resulting in the plunge of both revenue and foreign exchange earnings. “Besides, there were serious disruptions in the supply chain with consequential dislocations to many production processes. “The liquidity crisis in the foreign market has reached a scary level reflecting in acute foreign exchange scarcity, sharp depreciation in the exchange rate, widening parallel market premium and weakening investor confidence. “However, we believe that the Nigerian economy has some strong fundamentals.
Our natural resources endowments are vast, the domestic market is large, and our people are resourceful and enterprising. What is missing are the enablers,” she added. According to her, times like this offer tremendous opportunities for innovation, creativity, export growth and import substitution, adding that these are the silver linings in the current economic downturn.
On his part, Osinbajo explained that Nigeria, like all other countries, had been quite seriously impacted in various ways by the pandemic either as households or as businesses. “Contrary to earlier expectations, it is clear that the pandemic and its effects will remain with us for quite a while. So it has become clear that we have to adapt to it and adopt new ways of doing things. “So it is for what we are doing today. Of course, we used to meet physically, now we must deploy technology and meet electronically. In some ways, we have become efficient and effective,we are deploying far less time and resources to generate similar, if not better impact and outcomes, so there is a silver lining somewhere in these dark clouds. “I must say that the LCCI, with its rich history since 1888, is probably the only indigenous organisation of its kind to have been through a global pandemic like the Spanish influenza of 1918-1920. “So, I think we must have a few questions about how you coped then, you are probably the ones who can give us any advice on how to cope now. “But quite seriously, the fact that industry and business survived even in those early days with all the difficulties, surely must teach us something and the spirit of innovation, the spirit of being creative even in the most difficult times catches the essence of our approach to the challenges of the current situation,” he added. He, however, noted that the priority of the Federal Government in response to the economic challenges posed by COVID-19 was essentially to ward off a deep recession and to save jobs and this “we are hoping to do by a mixture of stimulus measures to support local businesses; the essence being to retain jobs and to ensure that we create the best possible circumstances for the most vulnerable in the society.” Also speaking on reduction in cost of doing business in the country, the Minister of Industry, Trade and Investment, Adebayo, disclosed that the Federal Government’s $3 billion loan it hopes to secure from the World Bank would be meant for bridging the gap in the country’s infrastructure to ease cost of doing business in the country. The minister emphasised that the $3 billion loan would address the gap between what is provided for in the current tariff, and the cost to business in the country. Speaking on the theme: ‘Benefits and Challenges of Business in Nigeria,’ Adebayo admitted that challenges of infrastructure deficit, corruption, insecurity, policy instability and others were slowing investment and ease of doing business in the country. Particularly, the minister explained that the present administration of President Muhammadu Buhari was determined to cushioning the challenges of ease of doing business in Nigeria at this period of COVID-19. He said that the country’s infrastructure challenges had been posing serious setback to investment development and the economy. According to him, the Nigerian Infrastructure Masterplan (NIMP) had shown that Nigeria requires an estimated sum of $3 trillion to upscale its national infrastructure over the next 30 years. He noted that this breaks down to an average of $100 billion annually. Adebayo said: “The President Muhammadu Buhari administration has taken strategic steps to resolve the power issue. This is evident in the conclusion of negotiations with Siemens AG to revitalise the power sector as well as expand the generation and supply capacity from 11,000 megawatts to 25,000 megawatts by 2025. “Also, the Federal Government is concluding plans to secure a $3 billion loan from the World Bank to bridge the gap between what is provided for in the current tariff and the cost to businesses.”
With COVID-19 crisis telling on the economy, it is compelling on the government to tackle head on infrastructural deficits, especially power, roads and congestion at the ports, which have ultimately posed a major concern to potential investors and existing business operators.