Companies suffering because of rampant government policies
In an interview with GLORIA NWAFOR, Adewale-Smatt Oyerinde, Executive Director of the Nigerian Employers Advisory Association (NECA), describes how unfavorable government policies are driving many businesses to extinction.
In recent years, the Nigerian economy has faced many problems. Given the idea that the private sector will drive the economy, what do you think the next administration will need to introduce to turn the economy around?
Now that the presidential election is over and the Independent National Electoral Commission (INEC) has announced the next president, we are enabling politicians to deal with the issues arising from the election and the courts to do their part.
From our perspective, we will focus on three basic issues that the new government should address.
The first is the basics of fiscal and monetary policy. It is the foundation on which so many factors lie, so it cannot be overemphasized. If you can’t get it right on that level, it’s hard to get it right in all other ways.
It’s like building a building on a very imperfect foundation. I feel that the challenge we have faced over the past eight years has been a conscious or unconscious misalignment in the context of fiscal and monetary policy. 42 foreign exchange items are prohibited. The idea was to save foreign exchange and help Naira stabilize. rice field.
It also banned the foreign exchange of dairy products, but naira was not appreciated even after that. We closed our borders in the hope that smuggling would be a thing of the past, but it continues.
The latest is the Naira redesign, which we said was a good policy, but the implementation is error-ridden, leading to a situation that many Nigerians are frustrated with. Fiscal and monetary policy must work.
Second, we need to address revenue issues.
Nigeria is the largest oil exporter in the Organization of the Petroleum Exporting Countries (OPEC), but even its ability to meet OPEC’s quota has been undermined by too many factors. Among them is the oil theft, which has so much impact on the economy and the world. whole country.
The third fundamental government must address from the context of our engagement is to ensure that the incoming administration drives a round nail in a round hole. Must be someone who understands the problem.
The president-elect must rise above politics, ethnicity and all the other issues that have brought us to our knees as Nigerians and play the role of a politician. We must choose individuals who can make a decisive difference in this context.
What are the implications for businesses when fiscal and monetary policies are pursued with conflicting objectives?
It is not enough for these authorities to implement programs and policies aimed at achieving the President’s objectives. Fiscal and monetary authorities are to assist him in achieving these objectives.
In that sense, it’s up to the president to make sure he understands where the economy is heading and whether he has a firm vision of where the economy is heading. The actions of the Governor of the Central Bank of Nigeria (CBN), the Minister of Finance and all relevant agencies must work together to ensure that the President’s mission is accomplished. But whatever they do, they’re stuck on the president’s desk.
The Supreme Court drags on what many experts call a simple monetary policy question that should have been done differently and which Nigerians would have been happy to support had it been done right. It was a pity that you were taken in.
Businesses are facing huge losses because they haven’t been able to get enough support.
This economic turmoil that I spoke of is based on two things. production and consumption. Disruption can be experienced in some way to the extent that it affects gross domestic product (GDP) values. If you are projecting 3-5% GDP growth, the moment you break the cycle of production and consumption, it affects people and businesses, and therefore your responsibility at the national level, which is GDP.
Most small businesses still rely on cash for transactions as the government attempts to implement a cashless policy. Do you predict that some of these businesses will disappear?
Some are already extinct. When you squeeze the bloody pipes into a business that is already lifeblood, expect absolute magic.
In the informal sector, it’s easy to imagine the amount of cash traded each day. Go to Mile 12 Market and other markets in Lagos and the Sea.
That’s because those above are not feeling all this, and that’s wrong. In the Micro, Small and Medium Enterprises (MSMEs) sector, many businesses have collapsed due to this policy.
How can Nigeria achieve an economically sound inclusiveness reform pathway with a focus on reducing the administrative burden on businesses?
You mentioned an interesting word: inclusivity. We feel that excluding people you plan to include is wrong in any policy. resulted in the exclusion of too many individuals from that policy.
All the knee-jerk reactions CBN said its officials were sensitizing Nigerians in rural areas are an afterthought. If you’re making policies that you think will radically lift the economy to a certain level, you need to get the buy-in of those who intend to implement those policies.
If you want me to do it and the policy affects me, it makes sense to bring me to the policy development stage. Please tell us the intention of the policy. This is important as they are part of the plan. At the time of implementation, they already have buy-in and participate in the analysis whether they achieve their goals or not.
At that point, you are building inclusivity and national consensus. That’s what was missing. We cannot impose policies on us in the 21st century. Rather, you take us.
What blueprint do you think the next government should set on key issues related to education and power?
No country can grow beyond the level of awareness of its citizens’ education. Unfortunately, over the last 30 years, education budgets have not been remarkable.
The country needs a summit of all stakeholders in the education sector. Let’s rethink our education sector. One of the key issues is curriculum review. It’s the same curriculum that runs from primary to tertiary, but what are you trying to achieve? Students who reach the secondary level are already potential employees or employers.
If the student is a potential employee, did what he/she was taught during his/her education help prepare him/her for the workplace? If not, we are wasting the student’s time. Because after spending years on a course of study and passing through a workplace, you realize things have changed.
worry. The federal government is still unable to fully fund education, and the Senate approves universities almost every day. We have commoditized education. Due to the high cost of studying abroad, I cannot enter the background of my study abroad. Let’s address the issue of educational standards in this country.
That way, as much as we can reduce the tendency of Nigerian students to study abroad, we will address leakage in the context of forex and build the competencies of our graduates so that they can meet the needs of the industry.
The energy crisis is one of the challenges facing organized businesses. Many opinions are shared about the state of power. We have a problem plaguing energy theft and vandalism. Generation, distribution, management, privatization, issues plaguing the average Nigerian’s purchasing power are all part of the paradoxes inherent in the power sector that must be addressed. we have to deal with the problem.
Unbundling them and bundling them again yields the same result. Governments must take a sober and holistic view of all the challenges surrounding the power sector. The power sector problem is multifaceted.
The government has promised that the Port Harcourt Refinery will be completed in June. Hope it alleviates the country’s fuel shortage?
Ironically, state-subsidized products are not available. We are still in line to get it. It is difficult to gather human resources who can operate the refinery well. On the other hand, there are individuals who have just built and are about to start operating.
It is a shame as a nation to wait for private smelters to be our saving grace. It’s embarassing. It is part of the contradiction I mentioned that we curse what is a blessing to many nations. In the Russo-Ukrainian war, many countries were cashing in on rising oil prices, but we are making and licking on fuel subsidies.
Every time the world price of crude oil rises, the value of imports increases.
The money we are supposed to be making is like a windfall from rising global oil prices. We make it, but we lose it to pay subsidies. We know that fixing a refinery is not rocket science and that between now and June the Port Harcourt Refinery can be on board so fuel shortage problems are a thing of the past. I strongly believe
Nigeria is the only fuel importer in OPEC, which is a shame. The next government needs a transition team to get the refinery up and running.