Lagos Chamber of Commerce and Industry (LCCI) Advises FG To Focus On Improving CapEx Budget Performance

By Clement Alphonsus
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Dr Chinyere Almona (Director-General of the Lagos Chamber of Commerce and Industry (LCCI)

The Director-General of the Lagos Chamber of Commerce and Industry (LCCI), Dr Chinyere Almona, has critically advised the federal government to improve its budget performance in terms of capital expenditure in 2024.

While speaking in Lagos, Almona noted that the performance of the capital expenditure has been very low relative to the recurrent expenditure, with serious implications for the country’s infrastructure sector. Describing the situation as worrisome, the DG said it demands urgent solutions.

She further explained that it is commendable to note that the strategic objective of the expenditure policy is to address macro-economic stability, investment environment optimisation, human capital development, poverty reduction and social security.

She said, “A review of the proposed budget revealed an oil price benchmark of $77.96 per barrel and a daily production estimate of 1.78 million barrels per day and an exchange rate of N750/$ was adopted. Further breakdown, indicates that non-recurrent expenditure is N9.92 trillion, which is N1.59 trillion or 19.1 per cent higher than the 2023 budget, while debt service is projected to be N8.25 trillion (N1.94 trillion or 30.7 per cent more than the 2023 budget) and capital expenditure is N8.75 trillion.”

According to the DG, the assumptions are very conservative, particularly in terms of oil prices and exchange rates.

She added, “However, we must note that daily oil production remains a major concern due to persistent underinvestment, vandalism, oil theft and rising production costs in the oil sector.

“The chamber also notes that relative to Nigeria’s GDP size, the proposed budget is 12.2 per cent, which is extremely low, compared to its African peers like South Africa, with a government expenditure to GDP ratio of 32.5 per cent; Egypt (24.7 per cent), Kenya (23 per cent) and Ghana (27.1 per cent). This is a serious issue that needs to be addressed by the Government, in the light of its renewed hope agenda."

Setting focus beyond the figures and policy statements contained in the 2024 Appropriation Bill, Almona advised the federal government to pay attention to investing more in transport infrastructure to mitigate the high cost of fuel and resolve the many logistical challenges that have impacted the movement of goods across the country.

She said, “Looking beyond oil revenues, government must build investors’ confidence and enhance our foreign exchange (FX) earnings through non-oil exports. We need to invest more in export infrastructure through automation and implementation of critical port reforms to reduce the bottlenecks in our export logistics and processes.

“Also, in addressing the most significant components of human capital development, we urge governments at all levels to be committed to significantly improving budget implementation in strategic sectors of the economy, including agriculture, education, health, infrastructure and security."

argely the capital of Igboland. So, we want to build our cargo terminal. We also want to ensure that the international wing of our airport is operational.

So, the idea is to engage with the federal government to ensure that we get all the required permits and licenses and make sure that we have an enhanced logistics hub to be able to attract the sort of investments we need. Therefore, I have essentially come to felicitate the president and enjoin that we continue to collaborate."

The governor explained that Enugu was ready for investment, also noting the issue of sit-at-home and the attendant insecurity were already sufficiently dealt with.

He said, “The sit-at-home thing is gone. We no longer have a sit-at-home in Enugu State, and I dare say in the South East. In our state, we have workers go to work on Monday and the schools are open on Monday. Business and economic activities are back. So, what we are dealing with now is to erase that sad memory from our history.

“Therefore, we have relatively enhanced security situation in the zone and Enugu State, and we are calling on those who want to invest in the zone to please come in. Enugu State is open for business."