FITC, yesterday, unveiled its National Economic Development Outlook Series (NEDS) 2022, stressing the need to support economic development and enable companies to grow and thrive this year and beyond.

Chizor Malize, Managing director and CEO, FITC

Pegged on global insights on contemporary economic imperatives and challenges relevant to Nigeria’s economic development, Managing Director/CEO FITC, Chizor Malize, stated at the event that, Nigerian economy is expected to experience some level of growth following higher oil prices, accelerated growth in information technology, and financial services sectors.

The virtual event, according to her, is part of the institute’s mandate and commitment to creating platforms for learning, keeping participants updated on key issues that would determine the fate of organisations, businesses, and the economy.

Malize noted that the budget is the key instrument for the execution of economic policies with the power to either promote or stunt growth in certain areas of the economy, a reason why it is very important for individuals, organizations, and businesses to fully track and understand all the implications therein for their operations.

In his presentation, Lead speaker, Chief Economist and Managing Director of B. Adedipe Associates Limited, Dr. Abiodun Adedipe noted that Nigeria’s monthly import bill had risen to N3.66 trillion.

To him, the continuing pressure from relentless imports and shrinking capability to pay foreign bills may likely force the Central Bank of Nigeria (CBN) to further devalue the naira, but not significantly.

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He stated that the monthly import bill of N3.66 trillion or $8.9 billion in the first to third quarters of 2021, more than doubled to $4.29 billion total import bill in 2020.

He also revealed that a lot of people are already mopping up dollars as the expected devaluation of naira persists, worsening naira exchange rate against other currencies.

“Five years ago, the Nigerian economy was x-rayed on five accounts of oil dependency, policy inconsistency, leakages, over-dependence on imports and low national productivity. These vulnerabilities have remained unchanged, five years after. Other economies are centred on export, but Nigeria seems geared towards imports. We need to explore the African Continental Free Trade Agreement (AfCFTA), by looking at Africa within the continent and ask: what do Africans import? From where do they import? This will then become our own focus for export,” he stated.

Director-General, Budget Office of the Federation, Ben Akabueze equally highlighted the need to diversify the tax net and increase the revenue stream for the economy. He said narrowing the budget deficit would require expanding Nigeria’s revenue base and fiscal prudence.

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He blamed the structural imbalance in the country’s economy as one of the reasons why the federal revenue ratio to the GDP has always remained very low.

“For instance, agriculture contributes close to a quarter of our GDP but yields less than one per cent to government revenue because of the structure of that sector that is largely informal and not taxable. These are the things we need to examine. Nigeria’s economic problem is largely structural. Even our high inflation is driven largely by structural factors’’.

“That is why reform is so critical. We need to reform this system. We need strong voices supporting agents of reforms in the government,” Akabueze said.

Calling for the need for effective taxes that take into consideration the economic impact of taxes on people’s businesses, Partner at PwC, Kenneth Erikume said: “The ideal scenario is to have minimum taxes for different sectors in the short term, but on the long term, companies should be taxed based on the economic outcomes of the businesses they have done.

“There is also the need to take proper care in taxing businesses to ensure their operations are not threatened by tax burden as the government strives to increase its revenue.”