The Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA) has painted a grim picture of the nation’s economic trajectory under President Bola Tinubu in 2024. The association criticized the government’s economic policies, claiming they disproportionately hurt the private sector while favoring public spending.
Dele Kelvin Oye Esq., the National President of NACCIMA, delivered a scathing assessment in a statement, declaring the economic performance for 2024 as “unsatisfactory” for the private sector. “All data, metrics, and statistics confirm that the Nigerian private sector has borne fully the negative burdens of the current economic reforms,” Oye stated.
The challenges identified by NACCIMA include soaring inflation, skyrocketing borrowing costs, and a steep currency devaluation. These economic realities, according to Oye, have stifled private sector growth while the public sector continues to expand.
“While in contrast, the Nigerian public sector thrives and expands, all economic benefits of recent reforms have been translated to the public sector through high capital transfers and revenues,” Oye lamented.
NACCIMA expressed concern over the imbalance caused by excessive fiscal deficits financed through unsustainable borrowing at exorbitant interest rates. These deficits, Oye argued, have destroyed value in the private sector, further widening the gap between public and private economic realities.
Policy Recommendations
To address these issues, NACCIMA made several recommendations, including reducing public sector spending and streamlining government operations. Oye highlighted the need for Nigeria’s public sector to become an “efficient productive unit.”
“Fiscal deficits arise when public sector expenditure exceeds public sector income. The funding of these deficits through borrowing results in high interest rates and high inflation,” he explained.
NACCIMA urged the government to undertake a rigorous review of its size and expenditure to eliminate wasteful spending. “Efficient allocation of existing resources can help reduce excessive borrowing,” Oye noted, citing Argentina’s example of eliminating recurrent budget deficits through bold political choices.
He further suggested reducing taxes to attract private sector investment and fostering an environment where the private sector can lead economic ventures. Deregulation, reducing bureaucratic bottlenecks, and reforming regulatory agencies like the Standards Organisation of Nigeria and NAFDAC were highlighted as critical measures.
NACCIMA also weighed in on the contentious 2024 Tax Bill. The association criticised the ongoing tussle between federal and state governments over tax revenues, describing it as a “disconnect” from taxpayers’ interests.
“We believe corporate taxes should be further reduced to 19% and VAT pegged at 7.5%. This will grow the economy and result in higher tax revenues for the government,” Oye proposed.
However, he emphasized that safeguards must be in place to protect government revenues. “Each taxpayer must not pay less than the preceding tax year,” he added.
The telecommunications sector was singled out as a significant taxpayer requiring urgent reforms. “There must be real dialogue with genuine concessions to be made by all parties,” Oye stated.
He warned that ignoring the sector’s needs could further stifle economic growth and reduce government revenues.
Oye emphasised the importance of treating the private sector as a key stakeholder in economic planning. He called for a “listening economic team” that would prioritise innovative solutions and work collaboratively with private sector leaders.
“Nigeria is a country with huge potential, innovative private sector minds, capital, and opportunities,” he asserted. “We deserve an economic team that recognises the private sector as stakeholders.”
