The Lagos Chamber of Commerce and Industry (LCCI) says paying for gas in dollars is not consistent with Nigeria’s industrialisation dream.
Speaking at a press conference on the state of the economy in Lagos on Wednesday, Babatunde Paul Ruwase, president of LCCI, appealed to government to review the pricing policy of the gas companies which prescribed payment of gas in dollars by industries.
“We believe this is not consistent with the objective of promoting industrialisation, economic diversification, and job creation of the current administration. Most manufacturers are producing for the domestic market. It is therefore inappropriate to compel them to pay for gas in dollars,” Ruwase said.
The LCCI president said power situation continued to pose challenges to business operators, crippling margins and growth.
“There are complaints across all sectors about high energy costs, especially high expenditure on diesel and petrol for large and small businesses respectively. Many businesses spend as much as 15-25 percent of their total operating cost on alternative power sources.
“However, we acknowledge the efforts of government to improve liquidity in the power supply chain, the drastic reduction in the debt owed to gas suppliers and the generating companies, and the enhancement of carrying capacity of the transmission grid. We are also aware that the Minister of Power is considering alternative models to fix the problem at the distribution end.”
He further said that the poor security could take toll on the economy by endangering food security and raising high food inflation.
Nigeria faces challenges of Boko Haram in the North East and herdsmen-farmers clashes across the country. Ruwase said being the food basket of the nation, incessant herdsmen clashes with farmers could have a serious impact on Nigeria’s food security in the future.
“Another implication is shortage of local raw materials for agro-allied businesses. The situation also has negative effects on investors’ confidence. There is also rising operational costs in terms of provision of private security, escorts, envoy operations and protection facilities of businesses in some sectors such as oil & gas increased by 12 percent over the last four years,” he said.