The Lagos Chamber of Commerce and Industry (LCCI) has tasked the federal government and the Central Bank of Nigeria (CBN) to focus more on policies that would provide support to the real sector and expand the country's export's infrastructure in order to contain domestic inflation.
The LCCI gave this task in its reaction to the recent increase in the Monetary Policy Rate (MPR) by the Monetary Policy Committee (MPC) of the CBN in which it urged the CBN and the fiscal authorities to intervene with policies and instruments that could boost growth in the economy since rate hikes are known to weaken economic growth.
The Director General of LCCI, Dr. Chinyere Almona, said: "In Nigeria, we need to tackle food inflation from the roots looking at issues like targeted support to the agriculture sector, manufacturing and the provision of more export infrastructure for businesses to export more and earn more foreign exchange.
"We urge the CBN to look further inward at the peculiar situations driving inflationary pressures within the Nigerian economy. Rate hikes are known to weaken growth, and as such, it is expected that the monetary and fiscal authorities intervene with policies and instruments that are growth-boosting. We are also calling on the government to commence preventive measures against the expectation of flooding in 2023."
Almona expressed concern that further increase in the policy rate would put additional pressure on businesses with the resultant effect of rising operating costs, low productivity and job losses.
"This was our major concern regarding the implementation of more taxes, as provided in the 2022 Finance Bill. We urge the government to consider streamlining these issues such that they do not swamp businesses and render them unproductive and uncompetitive.
"Beyond the rate hikes, policymakers need to consider more actions to increase and stabilise oil production levels to earn more FOREX. Better coordination of fiscal policies can complement the deployment of monetary instruments by the CBN."
The chamber also advised that businesses should also look inwards to source their raw materials instead of waiting for the CBN to allocate FOREX to them.
"We have consistently advocated for more friendly policy and business environment that will attract foreign and domestic investment and improve productivity, particularly domestic food production," she said.
The LCCI also commended the commissioning of the Lekki Deep Sea Port, the Lagos Rice Mill at Imota, the 18.75 killometres Eleko-Epe rigid pavement six-lane expressway, the first phase of the Blue Light Rail from Mile 2 to Marina, and the John Randle Centre for Yoruba Culture by President Muhammadu Buhari as significant factor in driving development in Lagos State.
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It, however, stated that to maximise the benefits of these infrastructures and facilities, "there must be a connecting rail network that supports the movement of goods and persons to fully facilitate trade and commerce within the state and across the West African borders.
"With this connection, Eko Rice can easily move into the West African markets to explore the benefits of the African Continental Free Trade Area (AfCFTA). With access to the African market, farmers in Lagos are encouraged to commit more investments into rice production, create more jobs, and provide more rice to beat the rising price of the product."
LCCI also encouraged other state governments in the country to provide the needed infrastructure to that could spur economic activities and growth in their respective states. "We also call on the federal government to be sensitive to the massive private investments in various states and be more intentional in creating a stable policy environment. Policy summersault has remained one of the most damaging factors to investors' confidence," the LCCI said.
