With the bitter pill of recession still biting hard, experts have suggested the need for the organised private sector to support the critical sectors of the economy.
The cross section of experts spoke at the third Nigerian Stock Exchange (NSE) & Bloomberg Chief Executive Officers (CEO) Roundtable held in Lagos at the weekend.
Tagged: ‘Innovating out of Nigeria recession: Exploring new paradigms for Nigeria’s economic growth’, the event drew experts accross key disciplines.
Firing the first salvo, Dr Doyin Salami, a Senior Lecturer at the Lagos Business School said that the federal government needed to partner with the private sector for private capital to get the country out of recession and for sustainable growth.
He said that the country had hit the bottom in terms of recession but its sustainability would depend on private sector involvement for private capital to ensure infrastructure development.
Salami stated that coming out of recession was not the major thing but growing rapidly and sustainability were the key things.
“If Nigeria grows less than three per cent, it means that per capital income is still very low,” he said.
Speaking on Economic Roundup, Salami said that Nigeria needed to diversify revenue base to strengthen economic growth and recovery.
The economist said that government must review minimum wage in line with the present realities, adding that consumers were under significant pressure due to shrinking salaries and wages.
He said that the last minimum wage was done in 2011, adding that workers had lost significant 50 per cent going by the challenges in the economy.
Salami stated that government needed to deal with youth unemployment to increase productivity, noting that the biggest challenge of the country was unemployment and productivity.
Dr Demola Sogunle, the CEO Stanbic IBTC Bank, said that banks non-performing loans grew massively with an average above 20 per cent in 2016 due to the recession.
Sogunle said that massive impairment caused by devaluation of the naira, foreign exchange illiquidity eroded capital of some banks in the 2016 financial year.
Sogunle said that the industry resorted to rationalisation, right sizing and other strategies to reduce cost.
He stated that the industry was tending toward digitisation to reduce cost, adding that banks could not afford to roll out branch networks.
Ms Funke Opeke, the CEO Main One, said that recession slowed down investment in the telecommunication sector.
Opeke said that the industry was unable to approach the market for foreign exchange for importation of equipment needed for efficient and effective service delivery.
She stated that the industry tried to drive operational efficiency out of the existing assets.
Mr Andrew Alli, the President and CEO Africa Finance Corporation (AFC), said that economic contraction affected project development in the country.
Alli said that there had not been many large scale projects in Nigeria in the last few years because of economic contraction.
Mr Oscar Onyema, NSE CEO said that the country needed to position itself to maximise the opportunities in the recovering economy.
Onyema said that policy makers should address foreign exchange policies and double taxation to ensure ease of doing business.
He stated that the exchange would continue to provide the needed platform for economic growth and development.