ACCORDING TO LCCI, NIGERIA COULD EXPERIENCE ECONOMIC STAGFLATION.

The Lagos Chamber of Commerce and Industry, or LCCI, issued a warning yesterday, stating that unless immediate action is made to address the economic growth, Nigeria runs the risk of entering an economic stagflation.

The Manufacturers Association of Nigeria, MAN, made an appeal to the Imo and Abia State governments to encourage industrial expansion and the creation of jobs by providing tax vacations to manufacturers on the same day that LCCI issued its warning.

The warning was issued in a statement by Dr. Chinyere Almona, Director-General of LCCI, the necessity for the Federal Government to continue its targeted interventions in important economic sectors.

“The economy has continued to blocks, including inflation, insufficient income generation, deteriorated infrastructure, FX issues, an unsustainable cost profile shown in debt services and subsidy payments, and rising insecurity,” she said.

“The chamber is afraid that if we continue on this path, the economy may bleed away into a stagflation, which will effect production costs, job losses, a worsening of the forex problem, and muted growth in the medium term.”

Reviewing the National Bureau of Statistics' (NBS) most recent release of the Gross Domestic Product (GDP), Second Quarter 2022 report, LCCI identified significant challenges to the country's future growth that need special attention.

It called on the government to take a tougher stance against the threat of oil theft and pipeline vandalism after noting that the oil sector has regularly recorded negative growth for the ninth consecutive quarter.

The chamber also bemoaned the relatively modest growth in manufacturing (1.2%) and agriculture (3%), compared to other sectors that saw growth rates above 5%.

This is a sign of the dangers facing the industries that fuel Nigeria's real estate market. The alarming increase is a result of the problems in these two industries.

And many more production operations may not be allowed in the upcoming months due to the severe cost of debt servicing, subsidy payments, and rising insecurity, according to the LCCI.

MAN asks for tax vacations for manufacturing.

The Manufacturers Association of Nigeria, or MAN, told the governments of the states of Imo and Abia to allow manufacturers a tax break so they can expand their businesses and generate jobs.

The appeal was made at the 35th Annual General Meeting of the Imo and Abia states division of the Manufacturers Association of Nigeria, or MAN, in Owerri.

They should step up efforts to encourage investment in manufacturing by supporting the creation of industrial parks and providing industries with incentives like tax holidays to stimulate industrial expansion and employment generation, he said.

He begged the federal government to “prioritize allocating foreign exchange to the country's manufacturing sector, while the Central Bank of Nigeria should order the commercial banks to carefully and transparently handle Foreign Exchange applications by manufacturers.”

Ahmed called on the government to enforce, evaluate and monitor the implementation of the Executive Order 003 to ensure compliance by Ministries, Departments and Agencies, MDAs, which should be cascaded to the local and state government levels.

Dr. Jude Eluma, the chairman of the Imo/Abia branch, welcomed the participants earlier and noted that the rising cost of diesel, input costs, the unreliability of the public power supply, the lack of forex for the importation of machinery intimidating level of insecurity, had been the major problems hindering manufacturers' functionality in the year under review.

To address our issues, regain confidence, and improve the ease of doing business in the states, we need the conscious cooperation of MDAs, both at the government levels.

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