The Organised Labour and employers have urged the Federal Government to deal with the multifarious challenges facing the country. They argued that if government does not resolve these problems before the next administration takes over, the economic crisis will be worse. TOBA AGBOOLA reports.
There are indications that the economy is headed for the rocks against the backdrop of insecurity, oil theft, inflation, rising debt profile and unemployment, ineccesant strikes, multiple taxes and forex crisis bedevilling the country.
In view of the above-mentioned problems, experts have urged the Federal Government to rise up to the challenges to salvage the economy.
They said many Nigerians were toiling under excruciating economic condition and that the rate at which poverty had eaten deep into the fabric of country was not only frightening, but also heartbreaking. This devastating national situation has left over 70 million unemployed in its trail, they noted.
Also, about 70 per cent of Nigerians has lost at least one stream of income or the other since outbreak of the COVID-19 pandemic and the attendant lockdown.
Worse still, inflation also skyrocketed. Food inflation reached a 15-year high last year, hiting 22.95 per cent in March. Import restrictions on rice and rising fuel costs have contributed to inflation. Overall, inflation and poverty levels have been on the rise, further compounding the crisis.
The experts said insecurity had assumed many dimensions, forcing the country’s political and economic managers and, indeed, the entire nation, to rue the loss of their investments, among others.
The number of violent crimes such as kidnappings, ritual killings, carjacking, suicide bombings, religious killings, politically-motivated killing, violence, ethnic clashes, and armed banditry and other crimes has risen beyound expectation, they said.
President, Trade Union Congress (TUC), Comrade Festus Osifo, at a briefing in Lagos, decried the multifarious challenges, stating that they were fostering social unrest and suffocating industrial and business activities.
He lamented that Nigerians were bombarded daily with reports of banditry, energy scarcity and price hike, kidnapping, Academic Staff Union of Universities (ASUU) strike, free fall of the naira, and others.
Solution
Osifo urged the Federal Government to focus attention on the digital economy as one of the ways to tackle the challenges. He said the digital economy was expanding at a very fast pace and had transitioned from being a luxury to an absolute necessity.
“Information and Communications Technology sector has been contributing an impressive percentage to the Gross Domestic Product (GDP) of Nigeria.
“This clearly shows the importance and potential of the ICT sector to our job creation and economic diversification agenda.
“Already, Nigerian ICT startups are leaving their mark on the global stage. We shall continue to encourage and support such digital entrepreneurs to develop innovative solutions for local and global challenges,” Osifo said.
On the ongoing strike by ASUU, he called on the Federal Government to borrow money to meet their demands.
He said: “The National Assembly said the 2023 budget will be in deficit and they are proposing N19 trillion and the funds they will generate will not be half of the money that will be borrowed.
“It is not our advocacy; the government had already made a plan. The government should take part of the money to solve the problem of ASUU.
“If the money they want to borrow is to complete the Second Niger Bridge or a railway line, the question is: Who wants to use them? Those sectors are not more important than education.”
Osifo said the country had been borrowing to solve its infrastructural problems and that infrastructure should not be more important than its citizens.
He said the country must get its priority right and that the government needed to put on its thinking cap.
He lamented the brain drain in the country, saying a government that fails to fix education is a joker.
The Nigeria Employers Consultative Association (NECA) charged the Federal Government to provide a lasting solution to the incessant challenges in the oil sector through building new refineries.
Its Director-General, NECA, Mr. Adewale Oyerinde, described as a sabotage the high level of crude oil theft, as well as pipeline vandalism in the country.
Oyerinde lamented that the trillions being spent yearly on subsidy could build a fresh refinery. He appealed to the Federal Government to fix the refineries to refine locally, instead of importing refined products, which, according to him, causes capital flight, as well as loss of huge revenue to the country.
“We should maximise our revenue by refining locally,” he stated.
He reasoned that beyond the issue of oil theft, the pipelines have also aged, necessitating their shutdown. He stressed that turnaround maintenance of the refineries might not be the best option.
The NECA boss noted that for years the government had been budgeting huge resources for turnaround maintenance without anything to show for it.
He insisted rather that the government should either build new ones or encourage the private sector to do so, as in the case of Dangote Refinery, which would save the country funds.
While urging the Federal Government to remove oil subsidies and rejig the economy, the NECA boss said the economy has not had it so bad like this, listing multiple taxes, high inflation rates, increase in foreign debts, unemployment as well as incessant strikes, among other economic hiccups.
He stated that the money spent on subsidy could be used to build new refineries, instead of few Nigerians benefitting from such government’s inefficiency.
He, however, recalled with dismay, the recent statement by the Federal Ministry of Petroleum Resources, that it had no financial records of fuel subsidy payments from the 2017 to last year.
“Let us face the consequences of the subsidy removal once and for all. I also support the labour position that subsidy is a scam,” he said.
Moreover, Oyerinde condemned the excessive taxation being imposed on businesses, saying it is affecting the private sector as well as businesses.
He said: “As we are trying to bridge the gap, the Federal Government is creating a bottleneck for private sectors through multiple taxes. There is a need for the government to give a clear roadmap. The government should think on how to cushion the pressure of inflation like in other developed countries of the world.’’
Oyerinde lamented how some government agencies slow down private sector operations through policies.
He said the organised private sector would continue to deepen their engagements with government for businesses’survival.
Oyerinde, however, commended the Federal Government for heeding the call to suspend the proposed telecoms tax in view of the economic challenges faced by operators and Nigerians.
He said: “We commend the Federal Government for suspending the telecoms tax as it has the potential to compound the challenges of the sector and further burden Nigerians. At a time the purchasing power of the citizens is being eroded by inflation and other negative economic indices and the telecoms industry is critically challenged, the best that the government can do is to provide relief for the citizens and business owners, notwithstanding its dwindling revenue.”
Employers in the chemical sector noted that the outbreak of the Ukraine-Russia war further worsened industrial and business activities around the globe.
Executive Secretary, Chemical and Non-Metallic Products Employers Federation (CANMPEF), Mr. Femi Oke, said: “There have been disruptive impact on international trade with cost of staple commodities and energy at a historic high-level, straining standard of living across the globe with developing countries hit the hardest.
“This global struggle is further compounded by social and economic stress from COVID-19 pandemic and its lockdown restrictions. In response, some Monetary Policy Authorities – the United States, Australia, including Nigeria — resorted to interest rate hikes.”
Oke said the sustained scarcity of foreign exchange in the productive sectors had worsened the inflation, resulting to the purchase of the limited supply at prohibitive cost.
On the way out, CANMPEF chief called for an approach that combines the use of fiscal and monetary policies to address the looming recession.
He asked: “How can Nigeria leverage its available resources to achieve maximum output, commencing with food security and healthcare needs?
“What sectors of the productive economy has shown the most resilience since COVID-19 pandemic outbreak and what can be done to further support its growth?”
He stated how, unfortunately, farming, a once-noble profession, had become a high-risk venture in some parts of Nigeria due to farmers and herdsmen’s clashes.
He said: “Insecurity of varied fashion and dimensions are prevalent across the country. To say the least, investors have flagged certain regions as off-limit zones. Unfortunately, business places and worship centers are not speared.
“With a general election upon us in a few months, the emergence of a new government whose economic policies may not align with the present is not unexpected (policy conflict).”
He opined that both the private and public sector have role to play to sustain peace through promotion of knowledge,
On the part of the government, the CANMPEF scribe opined that the need to strengthen administrative machinery to deliver on its obligation to its populace.
According to him, the cost of ASUU strike on the economy transcends both human resources and economic loss.
“The number of youth workforce migration to other climes in search for greener pastures is at an all-time. Thus, creating short and long term talent draught that our industries require to reposition itself and compete favourable in the new continental market (AfCFTA),” he said
He added that government should target its economic policies toward scaling up local production and efficiency with impact on quantitative and qualitative improvements, as well as impose strict compliance of Executive Order (003) across its MDAs to stimulate further patronage of made-in-Nigeria goods.