The Lagos Chamber of Commerce and Industry (LCCI) has advised policy makers on the formulation and implementation of policies to facilitate sustainability as business operators grapple with the devastating impact of the COVID-19 pandemic.
Mrs Toki Mabogunje, President of LCCI, gave the advice at a press conference on the state of the economy, in Lagos.
Mabogunje said such policies must support businesses, protect jobs, preserve investment and foster economic competitiveness at both national and subnational levels.
She said that the chamber endorsed the adoption of the cost reflective tariff regime in the power sector, while noting the push back by the labour unions on the policy.
The LCCI president said that the cost tariff regime was inevitable to attract investment and improve power supply, though safeguards were needed to protect consumers from exploitation.
“If the economics of the investment is not right, investors will not inject capital into the sector.
“However, there should be safeguards to protect consumers from exploitation.
“There should comprehensive metering of consumers and there should be value for money.
“We believe that policy should be given a chance,” she said.
The LCCI president said that the Solar Home Initiative, aimed at expanding energy access to 25 million individuals through the provision of solar home systems or connection to a mini grid, was a step in the right direction.
She said that the initiative would stimulate growth and productivity in the country’s rural economy.
Mabogunje commended government on the recent reforms implemented in the downstream segment of the oil sector.
She said the removal of subsidy on Premium Motor Spirit and the proposal of the Nigerian National Petroleum Corporation (NNPC) to give up majority stakes in the four local refineries were laudable.
Mabogunje, however, appealed for the provision of mass transit buses, development of rail system for intra city and intercity transportation, and the acceleration of the auto gas programme so that more vehicles could be powered by gas.
“We believe these measures are steps in the right direction in rescuing the economy from deepening fiscal crisis.
“We note that the subsidy regime had for long constituted a huge burden on public finances, encouraged corruption, inefficiencies, deterred investment flows, and weakened the earnings performance of oil refining and marketing companies.
“We acknowledge the effect of the price hike on the vulnerable segments of the society, accordingly, we request that palliatives be provided in form of mass transit buses among other initiatives to ease the burden on consumers,” she said.
Mabogunje also called for the expeditious passage of the Petroleum Industry Bill (PIB) to consolidate recent reforms in the sector.
On the various fiscal and monetary interventions by the government, Mabogunje said the schemes would help with fulfilling payroll obligations and help protect the jobs within the SMEs sphere.
She, however, said that special attention be given to sectors severely impacted by the pandemic.
“The Lagos Chamber acknowledges the various interventions of the fiscal and monetary sides of authorities in mitigating the adverse impact of the pandemic on economic and business environment.
“The federal and state governments need to expeditiously redirect attention to these sectors including aviation, hospitality, entertainment, and manufacturing.
“This has become necessary to protect jobs, preserve investments and provide the much-needed liquidity required to revive these sectors,” she said.
The LCCI president said the chamber noted the weak performance of the economy at sectoral level, particularly among key sectors with potential to drive economic diversification.
She said that the 6.1 per cent contraction of the Gross Domestic Product (GDP) in the second quarter reflected the profound impact of the pandemic on the economy.
Mabogunje said the Chamber anticipated a marginal improvement in GDP growth performance by the third quarter.
