Don't Miss

LCCI raises concern over SMEs, manufacturing sector

By BusinessNews Staff on December 31, 2013

The Lagos Chamber of Commerce and Industry has expressed concern over the state of Small and Medium Enterprises and the manufacturing sector, which it described as the most troubled sector of the economy.

In a statement on Sunday appraising the nation’s economy in 2013, the President of the LCCI, Alhaji Remi Bello, said the problems of the sector were evidenced by the negative investment sentiments expressed by the operators throughout the year.

According to him, the most disturbing factors affecting the development of SMEs and business generally are infrastructure limitations, continued influx of imported and substandard products, poor access to credit, high cost of doing business and the inhibitive activities of government regulatory and monitoring agencies.

“Budget approval delays and poor implementation of capital projects remain a major concern for the private sector. In an economy where government accounts for a major component of expenditure, early passage and proper implementation of budgets are very crucial,” he said.

Bello, however, said the ongoing transformation in the agricultural sector had the potential to diversify the economy, create jobs, ensure food security and expand foreign exchange earnings.

He added that transforming the sector was compelling, given the increasing wave of uncertainty in the international and domestic oil and gas market.

“The LCCI will like to see an inclusive and integrated agricultural sector transformation with a greater trickle down to the bottom of the pyramid within a reasonable time frame. We encourage the drivers of this initiative to design a strategy to accommodate small farmers who account for over 90 per cent of output and activities in the sector,” he said.

He said the chamber was also concerned about the impunity with which creditors of public and private sector institutions were treated.

He said this had become prevalent in the economy and needed to be urgently addressed.

Bello said some SMEs had been driven to bankruptcy because of this condition as there was little regard for contractual obligations.

The LCCI also expressed concern over what it termed the increasing disconnect between the quality of life and the impressive growth of the Gross Domestic Product at over six per cent (growth rate) in line with the International Monetary Fund’s projections and the Federal Government’s estimates.

“This reality is reflected in the country’s performance in some major global rankings released in 2013. Whereas Nigeria’s GDP ranking by the IMF was 37th out of 187 economies profiled; global competiveness ranking by the World Economic Forum was 137th of 183 economies reported; while the Human Development Ranking by the United Nations Development Programme was 153 out of 187 countries profiled,” he said.

Bello, however, said the naira exchange rate, which fluctuated within the set bound of N160 per dollar throughout the year, was impressive and should be sustained.

[Punch]

headline