The Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture has lauded the timely presentation of the 2022 budget to the National Assembly by President Muhammadu Buhari, but expresses worry over the mounting debts being incurred.
The President, NACCIMA, Chief Ide John Udeagbala, gave this commendation and caution in a statement made available to our correspondent.
He sad, “Notably the early presentation of N16.9trn Budget described as a Budget of Economic Growth and Sustainability is in line with the trends of recent year of presenting our national Budget in a timely manner.”
He was equally impressed that the National Assembly has promised to process the appropriation Bill in a timely manner and before the end of the year, to sustain the January-December budget cycle.
He added, “We also welcome the decision to inject affirmative action into the Budget through its gender component thus making it gender friendly. We see this as a historic decision.
“The Association is, however, worried by the upward swing in the borrowing to finance the Budget. There is need to watch the rising profile of our debt. An increase in deficit to N6.26trn, which is to be funded by borrowing is worrisome.
“While it is an accepted fiscal option across the world, for countries to resort to borrowing to finance shortfalls in their budgets, there must be caution in what component of the budget will be financed by the budget.
“A sustainable debt profile requires that borrowed funds must be used for critical infrastructure projects that will enable payback of these loans.
“There are speculations that the borrowings have been encouraged by projections that the Nigerian economic will grow by 2.4 per cent in year 2022 well above earlier projected GDP growth of 1.8 per cent. It was also said that decision on scaling up borrowing is based on assurances of revenue from the prices of crude which now hover around $80 dollars well above $57 backed by projected, 1.88million barrels a day.”
The Association, however, drew attention to the boom and burst cycle of international crude oil prices, which it said could not be relied upon as firm and assured sources of revenue.
Rather, NACCIMA argued, there must be continued efforts to diversify the economy, improve significantly on non-oil revenue and deliver on upgrade of infrastructure and improvement in security situation.
This, it added would ensure increase in productive activities especially in the Agric sector, and that most importantly, the private sector should be encouraged to tap into the opportunities under the budget.
NACCIMA welcomed the the decision under the Budget to further strengthen the frameworks for concessions and Public- Private Partnerships(PPP) and “that capital projects that are good candidates for PPP will be developed for private sector participation.”
While it noted that Budget 2022 has been described as Budget of Economic Growth and Sustainability, NACCIMA hopes that in its implementation “it will be a budget of inclusive economic growth, a growth trajectory in which no one will be left behind, especially the poor segment of our population.”