As the nation entered recession for the second time in five years, the Nigerian Association of Chambers of Commerce Industry Mines Agriculture, has called on the Federal Government to initiate recovery measures.
This was contained in a statement signed the Director-General, NACCIMA, Ambassador Ayo Olukanni, and it came almost 24 hours after Nigeria Employers Consultative Association made same call.
The chamber which noted that it had earlier predicted the recession, given the devastating effect of the COVID-19 on businesses and drop in the global price of crude oil, added recovery would depend on government policies.
It further said the contraction of the Gross Domestic Product in the second and third quarters of 2020, especially the negative rates of growth were not surprising.
It stated “The contraction of GDP in two consecutive Quarters (minus) -6.1 per cent in Q2, 2020 (dropping by 7.9 percentage-points from 1.8 per cent in the 1st Quarter of year 2020) and (minus) -3.62 per cent in Q3, 2020, reflects the effects of the near total closure of the Nigerian economy for the months of April to June 2020.
“The COVID-19 pandemic during this period, led to workforce depletion, either through corona-virus infections or the mitigation policies of social distancing and isolation to stop the exponential spread.
“The pandemic also affected the global price of crude oil and consequently a negative impact on government revenue and foreign exchange reserves.”
NACCIMA had consequently advised that government at all levels should resist the urge to tax or place an economic burden on the citizenry, as this would stifle economic activity and persist the cycle of recession.
It further counselled that government at all levels adopt policies that mitigate workforce depletion and encourage production processes that reduce corona-virus infections, emphasize early detection with adequate facilities for isolation and treatment.
It added that the government must stimulate economic activity by creating a regulatory environment that ensured that citizens took on productive activities.
It said, “We are still of the view that this approach, combined with a shift in focus from lump-sum taxation to consumption and/or sales taxes will create the appropriate environment for a quick recovery from economic recession.”
NACCIMA said recovery measures must focus on how to support the Micro, Small and Medium Enterprises in particular, and ensure the effective and urgent implementation of the Economic Sustainability Plan through release of funds “under the plan which touches all areas of the economy.”