May 29, 2016 would mark a year after the President Muhammadu
Buhari-led administration took over the reins of power, but with no clear
direction of where the economy is headed, businesses have continued to pine
under the yoke of stifling regulatory headwinds.
Many businesses are literally fighting the battle of their
lives as their corporate existence is being threatened, no thanks to the rather
hostile operating business environment.
Although most of the businesses had anticipated the new
government would take a while for it to gather steam, they had hoped that life
would be back on an even keel in no time at all. But after almost one year,
that hope has remained forlorn.
Crux of the matter
A number of policies have had rippled effects on businesses
across the board, chief among which is the Central Bank of Nigeria (CBN) policy
restricting the use of Naira cards abroad.
This is the second time the CBN is putting restrictions on the
use of naira cards outside the country — one of many other policies put in
place by the CBN Governor, Godwin Emefiele.
Speculators had warned at the time that if the authorities
in charge are not careful, there may be another devaluation of the national
currency very soon. Thus many entrepreneurs have been forced to wait for the
economy to stabilize before they can continue carrying out their business.
Last month, the CBN Governor said that the bank will not
devalue the Naira again despite calls for the devaluation of the currency in
times of economic turmoil. According to Mr Emefiele, the Naira is
‘appropriately priced’.
Growing concerns from stakeholders
Speaking at separate fora recently, President,
Manufacturers Association of Nigeria MAN, Mr. Frank Jacobs and Director General
of the Lagos Chamber of Commerce and Industry LCCI, Mr. Muda Yusuf, described
as stifling the prevailing operating business environment.
The MAN President noted that many operators in the nation’s
real sector closed shop in 2015 due to harsh operating environment characterized
by poor infrastructure, low consumer demand and unfair competition from low
quality products smuggled into the country, warning that many more firms would
close down due to the foreign exchange policy.
While calling on the Federal Government to have a rethink on
the policy by making foreign exchange available for real sector operators that
need to import raw materials, he warned that if not reversed, the policy will
lead to the closure of more companies.
According to Yusuf, the forex restriction policy has had
great danger for the Nigerian economy, especially in the first quarter of 2016.
Expatiating, he said: “We believe that lifting the
restriction on foreign exchange and adjusting the exchange rate of the naira
will make substantial impact on the nation’s economic recovery.”
Millions of jobs threatened
The lull in business activities occasioned by the stifling
operating environment is already taking its toll on businesses with millions of
jobs threatened across the sectors.
Leaders of Food, Beverage and Tobacco Senior Staff
Association, FOBTOB, have raised the alarm that the nation may lose three
million jobs in the sector if government does not urgently review its foreign exchange
(forex) policy.
According to the union, leading companies in the sector have
invited labour for discussion on retrenchment of workers.
These companies, FOBTOB said include Nigerian Flour Mills,
Nigerian Breweries Limited, Guinness Plc, Nigerian Bottling Company, 7-UP
Bottling Company Plc, Friesland Campina Wamco Plc.
While calling on government to intervene to save the
industry and millions of jobs, FOBTOB alleged that not less than 1,500 workers
had been sacked in the last three months over the forex crisis.
Need for action plan at the ministry
The President, National Association of Nigeria Traders,
NANTS, Ken Ukoaha has lamented that there does not seem to be any policy
direction for the Ministry of Industry, Trade and Investment.
Ukoaha who made this observation during a media capacity
building workshop in Abuja at the weekend, said inasmuch as he supports the
present government, the previous government did a good work in giving Nigerians
beautiful policies, though marred by corruption.
He however, impressed on the present government, the need to
borrow a leaf from the past policies as they can serve useful purpose.
“We are calling on the new administration to give us a
template to work with, an economic blueprint, so that after four years we can
come to say this is the criteria for the benchmark given, this is where you
passed and failed.”
While noting that the transition agenda has elapsed in 2015,
it will be one year in May 29th 2016, with nothing to show for it, he
urged the Minister of Industry, Trade and Investment, Dr. Okechukwu Enelama to
be alive to his responsibilities.
Even with the budget just passed by the National Assembly,
many economic pundits are not persuaded things would get back on an even keel
so soon because of the bureaucracy of government.
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