Some experts on Friday called on the Federal Government to involve the private sector in its new economic recovery plan for the needed foreign and portfolio investments, to bring the country out of recession.
They stated this in at the Vanguard Economic Discourse themed, “The hard facts to rescue the Nigerian economy,’’ in Lagos.
Mr Muda Yusuf, the Director-General, Lagos Chamber of Commerce and Industry (LCCI), said that the country would not experience any economic recovery without the involvement of the private sector.
Yusuf stated that government should involve the private sector in the new economic plan to take the country out of recession because they were the ones that would bring in investment.
He said that the key driver of investment into any country was confidence, adding that confidence building through good economic policies was needed for both foreign and portfolio investments.
“We cannot get these investments to come into the economy without confidence,” he stated.
The director-general said that getting the foreign exchange regime right was critical to confidence building, noting that no economy can live in isolation of other economies.
Yusuf said that critical scarcity of foreign for manufacturing companies was affecting their production capacity to move on with their businesses, with some of them having to close down.
He said that the policy had brought about all manner of underhand dealings, drop in remittances, dividends payout and drop in profits, among others.
According to him, people have suffered serious loss transiting from the former foreign exchange rate policy regime to the new one.
He stated that many businesses had collapsed because of inability to service off shore obligations and credit lines.
Yusuf added that round tripping in the foreign exchange market was very high because the huge exchange gap and margin.
“We need to fix liquidity issues in the foreign exchange market by allowing the market to play bigger roles, rather than regular CBN interventions,” Yusuf said.
He added that the current monetary policy rate would not in any way help to rescue the economy, noting that policies and incentives determine the kind of Investment people pursue.
Yusuf also said that government borrowing had become a major problem of investors.
He said that government borrowing at 18 per cent, without risk, was crowding out the private sector with banks preference to invest in Treasury Bills and bonds, instead of lending to the real sector.
“We cannot compete with the Federal Government in investment, banks invest in Treasury Bills and bonds, rather than borrowing to the real sector,” he said.
Yusuf stated further that high cost of business in the country, due to high inflation rate, was affecting the growth and development of industries.
Also speaking, Dr Obadiah Mailafia, a former CBN Deputy Governor, said that there was the need for a national concensus with regards to national development, for the country to move forward.
Mailafia said that the insecurity of lives and property and rise in crime rate was affecting economic growth and development and should be checked.
He stated that the country was losing money with the closure of the Abuja airport following some international airlines decision not to fly to Kaduna, due to alleged security challenges.
The former CBN deputy-governor said that the country must industrialise and improve on technology innovations or perish.
“We are still very behind in the issue of industrialisation, technology and innovation and if we fail to industrialise, we will perish,” Mailafia stated.
He added that youths involvement in the government’s economic recovery plan was low, in spite being the majority in the country’s population.
Mailafia said that the country was sitting on a time bomb, if they were ignored, considering the rising unemployment rate.
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