“There is need to restructure government spending in favour of capital expenditure in view of the huge infrastructure deficit confronting the nation. The relatively low performance in capital budget which hovered around 60 per cent as at December 2017, when compared with the almost 100 per cent implementation of recurrent expenditure was not development friendly,”
The charge was from Mr. Babatunde Savage, Chairman, International Chamber of Commerce Nigeria (ICCN) during its 18th annual general meeting in Lagos recently.
According to him, “The trend of unspent capital allocations which are usually returned to the treasury is blamed on delayed budget approval processes. There is need to revisit this issue for the good of the economy.”
He however stated that the drive for local and regional investment is gaining momentum, stressing that comparatively, the convergence of local and foreign investment is also supported by strong macroeconomic growth and outlook, improving business environment in the country.
On the global competitiveness index, he said Nigeria’s downward trend can be attributed to worsening macroeconomic conditions, high inflation, huge budget deficit, poor health and primary education, poor higher education and training, huge infrastructural gap, low technological readiness and innovation gap, and uncertainty in business environment.
According to him, with the gradual recovery from recession, stability in exchange rates, inflation under control, there is certainly hope for Nigeria to be optimistic.
“Oil prices have surged to $60-70pb beyond 2017 expectations, offering Nigeria some respite and suggesting a better economic outlook in 2018. We would expect increased diffusion effects of oil sector growth in 2018, through budgets and government spending; oil sector procurement, wage and CSR growth and oil sector support for the external sector,” he said.
He expressed concerns about pronouncements and agitations by various ethnic and regional groups that could threaten national peace and stability and economic prosperity in Nigeria, recommending that the current efforts of the Federal Government to address the security issues be sustained.
“Most importantly, those nefarious acts that have dislocated and shattered economic activities in the affected states need to be tackled more effectively with a view to bringing them to a halt,” he added