By Yinka Kolawole
The Lagos Chamber of Commerce and Industry (LCCI) has called for structural reforms that encompasses review of foreign exchange (forex) management and increased investment in infrastructure, warning of continued rise in inflation in 2021.
Director General, LCCI, Dr Muda Yusuf, speaking in the Chamber’s “Economic Review and Outlook for 2021”, made available to Vanguard, said inflation rate will continue its climb by 2021 as a result of rising food prices due to the disruptions in food value chain caused by insecurity, energy costs and lack of forex liquidity.
However, he believe a broad-based harmonisation of fiscal and monetary policies towards addressing the identified structural constraints will significantly help to moderate inflationary pressure in the medium term.
On the general economic performance, the LCCI boss said Nigeria’s economic performance was deeply affected by COVID-19 disruptions, adding that the weak economic state would persist till the first quarter of 2021.
He also noted that the Nigerian Economic Sustainability Plan (NESP) will expire in the first half of year 2021, and called on the federal government to initiate a new plan to address key economic and policy concerns in the country.
He stated: “To foster economic resilience in year 2021, quick implementation of structural reforms including review of the foreign exchange management framework and significant investment critical infrastructural developmental projects are imperative.
“Looking forward, the following will shape the outlook for 2021: (a) Covid-19 resurgence (b) African Continental Free Trade Area (c) Power sector reforms (d) Finance Bill 2020 (e) Passage of Petroleum Industry Bill (f) External Sector trends and (g) new national economic development plan to shape government’s policy direction in the coming year.
“The Federal Government must be broad-based in its approach in developing a comprehensive development plan that addresses key economic and policy concerns in the country.
“We expect the new development plan to cover critical issues including macroeconomic stability, employment generation, investment, poverty reduction, financial empowerment, infrastructure development, ease of doing business, human capital development, industrialization, and security.”