Policy reforms by the government, especially the removal of fuel subsidies and floating of the exchange rate, are expected to boost fiscal revenue and contribute moderately to the improvement of the country’s growth prospect this year, the President, Lagos Chamber of Commerce & Industry, (LCCI) Mr Gabriel Idahosa, has said.
He spoke at the presentation of 2024 Economic Outlook and Budget Analysis with the theme: “Building Economic Resilience in 2024: Strategies for a Sustainable Future” event organised by the Chamber.
He observed that the economy last year proved to be surprisingly resilient amid multiple shocks arising from significant inflationary pressures, consistent currency depreciation, decelerated economic growth and monetary tightening.
Others are debt sustainability challenges, declining real income, high unemployment and poverty levels.
Quoting World Bank 2024 global economic prospects, he stated that its growth projection for Nigeria in 2024 and 2025 averaged to 3.3 per cent and 3.7 per cent which translates to 0.3 and 0.6 percentage point.
Similarly, the United Nations Department of Economic and Social Affairs in its World Economic Situation and Prospects 2024 projects that Nigeria’s economy will grow by 3.1percent in 2024 and 2025, with inflation expected to gradually ease as the effects of last year’s exchange rate reforms and removal of fuel subsidies fade.
He said, however, that downside risks to growth prospects include rising cost of living, weak business environment, poor manufacturing performance and rising unemployment.
In a keynote, Chief Executive Officer, Financial Derivatives Company, Bismark Rewane observed that some sectors such as financial institutions, telecommunication, and construction are achieving growth over the national average.
He criticized the targets of budget 2024 as vague because of several lofty targets of achieving job-rich economic growth, macroeconomic stability, reduction of fiscal deficit from N13.78 trillion to N9.18trillion, enhanced human capital development and poverty reduction.
Others are better investment environments, increased revenue to GDP, reduction in the cost of doing business and cost of living of an average Nigerian. He added that fiscal spending has not been complemented with adequate domestic & foreign investments.
He predicted that the economy could only get better if there is increased spending in infrastructure development, adding that deficit spending is yet to yield the intended impact on the economy.
Rewane lamented the lack of transparency, clear policy duration and lack of effective price discovery. On the way forward, he said Nigeria should think of ways of rescheduling debt, increasing interest rates and cost reflective electricity tariffs.
Director General, Budget Office, Ben Akabueze spoke strongly in favour of the 2024 budget and its capacity to deliver on expectations. He said one of the challenges facing the nation is that of low public revenue against a growing population. He said the nation has had over three decades of deficit budget that it has not been able to pay back. He said the popular mantra of some analysts is the need for the nation to spend less but he argued that what the nation needs to do is to spend efficiently and not less.
Also, Taiwo Oyedele stated that if local refining supported, the nation will come out of the woods. According to him, there is a lot of price inefficiency on the cost of fuel and diesel. He hailed the 2024 budget as on target as Education and health fared better. He advised the government to stop forth with what he called nuisance tax as businesses are exposed to multiple taxation.
SOURCE: THENATION
