‘Economic challenges may close down more businesses’

Nigeria Employers’ Consultative Association (NECA) has raised the alarm that more businesses will be shut by their owners due to the challenges of the economy.

It charged, therefore, the President Muhammadu Buhari administration to ensure that the economy does not collapse.

According to the Director-General of the association, Mr. Adewale-Smatt Oyerinde, the organised private sector (OPS) is more at the receiving end of the economic challenges arising from poorly implemented policies, which are forcing Nigerians to contend with multi-faceted problems.

“While it is commendable to develop policies and programmes, the implementation of same is as important to the success of the said policies and programmes,” he said.

He reasoned that from the ban of 42 imported items from accessing forex, ban of dairy products, to the closure of land borders and the redesign of the naira, the trail of poor implementation decisions was worrisome.

On the myriads of the challenges, the NECA DG said it is obvious that the country is not short of good policies, but implementation.

According to him, while the naira redesign is commendable, the implementation is condemnable.

He added that a policy that was designed to curb inflation, encourage the cashless culture and foster financial inclusion, among others, is inadvertently pushing many Nigerians into frustration in view of the epileptic bank transfer/e-payment systems and inadequacy of online banking infrastructure.

He said: “The current situation portends grave danger for the economy, even as Nigerians do not have access to the new notes, businesses are short of sales and most employees find it difficult to go to work because of lack of cash.

“It is apt to conclude that it could be counter-productive to seek to implement a cashless economy abruptly, when at the same time the new Naira notes are being rolled out in limited quantities within an impracticable timeframe.”

He lamented that as Nigerians grapple with limited availability of cash, they are at the same time confronted with scarcity of petrol, a product for which trillions of naira is being expended as subsidy, while businesses also continue to face increasing energy cost, and inadequate forex, high operating cost, among others.

Oyerinde stated that with the rising inflation and real reduction in purchasing power of the citizens, the nation could be witnessing the dearth of many small and medium scale businesses and also shutting down of many otherwise large businesses.

On the way out, he advised the government to, “as a matter of urgency ensure the availability of the new Naira notes and, prosecute saboteurs, if necessary, to ease the frustration of Nigerians and avert the impending breakdown of law and order”.

He said contrary to the touted narrative, and according to financial experts, Nigeria does not have excessive cash in circulation (it is less than two per cent of GDP).

“The latest report by the CBN actually shows that currency in circulation is only N3 trillion out of N52 trillion aggregate money supply,” he said.

Stating further that if the Monetary Policy is not working, as it has been observed, it is not because of the N3 trillion out of N52 trillion (which is less than six per cent).

He added that making currency scarce only increases the incentive for counterfeiting.

He, however, called for drastic action to ensure adequate supply of petroleum products to cushion the harsh effects of current scarcity.

“Making Nigerians to spend hours on queue for a product that the nation is blessed with, which is also subsidised is not only contradictory, but also shameful,” he said