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*Reiterates need for national assets register

By Yinka Kolawole

The Lagos Chamber of Commerce and Industry (LCCI) has called on the Federal Government to replace Nigeria’s existing debt stocks with asset-linked debt to ease the nation’s huge debt servicing burden, with a debt service to revenue ratio of about 98% for the period of January to May 2021.

Director-General, LCCI, Dr Chinyere Almona, stated this in a statement on “Practical Steps for Boosting Revenue and Foreign Exchange Inflows”, made available to Vanguard.

She also restated the need for the creation of a national asset register for the country.

Almona stated: “Nigeria’s fiscal and financial challenges have been of concern to several stakeholders including the LCCI. The Government has increasingly resorted to debt to finance recurrent and capital obligations in the face of dwindling revenue. The country’s debt situation has become worrisome with debt servicing consuming a significant share of the revenue. The debt service to revenue ratio for the period of January to May 2021 stood at about 98% up from 83% recorded in 2020 according to the budget implementation report.

“Nigeria is an asset-rich nation owning hundreds of large state-owned companies, valuable parcels of land, and built structures in prime commercial locations.

These assets are grossly underutilized and contribute too little to the country’s fiscal and financial situation because their market values are currently not known. There is, therefore, a need for the government to take urgent steps to establish the market values of the assets, securitize the corporate assets and commercialize the real estate assets to raise revenue for the government and foreign exchange inflows for the country.

“There is a need to replace existing debt stocks with asset-linked debt to ease the debt servicing burden; attract greenfield FDI into publicly-listed state-owned companies; generate new revenue streams from commercialized real estate portfolios.”

To tackle the numerous challenges, Almona said LCCI is recommending to the government at both federal and state levels to: Identify public assets; Determine the worth of these assets; and Create a dynamic online digital platform where the financialized and commercialized assets can be offered for investment.

The LCCI DG however noted that the recommendations “do not connote the sale of national assets but a mechanism to generate more revenue from the assets without their outright sales. This is a more sustainable way of revenue generation and boosting foreign exchange inflows”.

Vanguard News Nigeria