LCCI Worries Over Real Sector Decline
GILBERT EKUGBE
The Lagos Chamber of Commerce and Industry (LCCI) has expressed concerns over the decline in the nation’s real sector despite being the second largest employer of labour after government.
Besides, the Organised Private Sector (OPS) noted that the performances of key sectors with capacity to facilitate the present administration’s drive for economic diversification are still largely constrained.
According to LCCI in a statement issued to InsideBusiness, the manufacturing sector grew at a slower pace of 0.77 per cent in 2019 as against 2.09 per cent in 2018, maintaining that the growth of the sector was heavily weighed down by the oil refining subsector which slumped by 32 per cent in 2019.
The report gathered that despite being the biggest beneficiary of CBN’s push for credit flows into the real economy, productivity in the manufacturing sector continues to be challenged by a tough operating environment, poor infrastructure, and unpredictability of government policies.
Highlighting steps going forward to salvage the manufacturing situation, he called on the urgent need for the economic managers to fix power challenges to reduce cost and enhance competitiveness; ensure patronage of locally produced items; curb smuggling and dumping and the urgent need to reform port processes and ensure better port infrastructure.
Reacting to the recent GDP growth report released by the National Bureau of Statistics (NBS), it noted the marginal improvement in Nigeria’s output performance as GDP Growth grew by 2.27 percent compared to 1.91 per cent recorded in 2018.
LCCI stated that the growth in the year 2019 was largely driven by the oil sector which grew at a faster pace of 4.59 percent in 2019, from 0.97 per cent in 2018.
“This was driven by increased average daily crude production of 2.01 million barrels in 2019 compared with 1.92 million barrels in 2018, as well as favourable oil prices (which averaged at about $64 per barrel in 2019),” LCCI said.
The Organised Private Sector (OPS) stated that the growth was also driven by the ICT sector which grew by 11.08 percent in 2019 compared to 9.65 per cent in 2018, stressing that growth in the ICT sector was driven by telecommunication and information services sub-sector, which rose by 11.33 per cent and 11.41 per cent in 2018 and 2019 respectively.
“The rapid growth of the ICT sector can be attributed to increased investment in fintech space, expanded e-commerce and diverse innovations in the use of ICT across sectors,” LCCI added.
LCCI noted that the agriculture sector also played a key role in the GDP growth as the sector grew by 2.36 per cent in 2019 as against 2.12 per cent in 2018, pointing out that growth of the sector was powered by crop production, which accounts for over 85 per cent of productivity in the sector.
“On a quarterly basis, agriculture expanded by 2.28 per cent and 2.31 per cent in the third and final quarter of 2019, which was supported by the sustained intervention of the Central Bank of Nigeria and positive impact of land border closure,” LCCI noted.
“The assessment of realities in the macroeconomic environment suggests that the economy is yet to recover from the 2016 recession. Growth is still sluggish and weak to create employment opportunities for the fast-growing population and lift millions of Nigerians out of poverty. There is a need for government to embrace the structural, policy and regulatory reforms to unlock the huge growth potentials in the economy,” LCCI added.
Comments are closed.