The Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture has called on managers of the economy to review downward the Monetary Policy Rate, which is currently at 14 per cent, in order to attract the much needed Foreign Direct Investments to the country so as to drive growth.
The National President, NACCIMA, Chief Alaba Lawson, stated this on the sidelines of a press briefing on Monday to review the state of the nation’s economy.
“The private sector is advocating a review of the policy to encourage the sector and more investments,” she noted.
According to the NACCIMA president, the Central Bank of Nigeria’s decision to retain the MPR and Cash Reserve Ratio at 14 and 22.5 per cent, respectively, is not ideal to attract private sector investments.
Citing data from National Bureau of Statistics, Lawson stated that the Nigerian economy grew by 1.95 per cent in the first quarter of this year, an increase she said could be traced to improvement in global oil prices and output.
She observed that the nation’s non-oil sector contracted from 92.65 per cent of the Gross Domestic Product in the fourth quarter of 2017 to 90.4 per cent in the first quarter of 2018.
She noted that the decrease showed that there was a lot of work to be done to increase the output from the non-oil sector.
“We need to pay more attention to this sector in view of the non-reliability of oil prices, which more often than not is also subject to the vagaries of the international political environment,” Lawson said.
According to her, inflation continues to be in double digits, stressing that despite the consecutive decline with a positive growth on the economy, the rate of inflation still remained high.
On the nation’s foreign exchange reserves, which increased to $47.75bn on May 21 after dropping for the first time in eight months in the early part of the month, she noted that it was a good indication, because it would lead to more liquidity in the foreign exchange market and help to stabilise the naira.
Lawson charged the Federal Government to come up with more favourable and stable policies to encourage more domestic investments in non-oil exports in line with the commitment to diversify the economy, improve revenue generation and contributions to the nation’s external reserves.
On the 2018 budget, the NACCIMA boss commended the Federal Government and its Ministries, Departments and Agencies for the timely presentation of the budget proposal to the National Assembly, but decried the late passage of the budget by the legislature.
She said, “NACCIMA is of the opinion that this act of passing yearly budgets late is unhealthy for the economy. It does not augur well for the management of the country’s resources and projects. It also has direct implications on projects, programmes and spending by the government. Likewise, it affects planning by the private sector.
“As the voice of Nigerian business, stakeholders in the private sector and concerned citizens, we call for swift passage of our yearly budgets. And now that the 2018 budget has been passed, we call for its urgent implementation.
“In doing so, we applaud the allocation of about 30 per cent of the budget to infrastructural development in the 2017 and proposed 2018 budgets. We urge judicious and strict implementation of the budgets in order to achieve the projected gains in all sectors of the economy.”