The reduction will improve the economy because the items are sources of raw materials for industries. And since the government has promised that they want Nigeria to be industrialised, policies should be directed to help local production of goods and services. Most of the industries have no raw materials and if the manufacturers are fighting the same way as the finished goods that are being brought into the economy, it will not help local manufacturers. If imported goods are 10 per cent and raw materials are 10 per cent, how will manufacturers break even? There is no way.
There will be no difference between the imported and the ones manufactured in the country. In fact, the ones imported may even be cheaper, thereby crippling local industries. It is a welcome idea, as they (the reduction in import duties) will reduce the cost of raw materials for local needs.
I will still appeal to industrialists to go ahead in pursuing their ways of doing business. I will also appeal to the government to ensure that there is foreign exchange to bring those raw materials to the country. Lack of foreign exchange is still a big problem. The government needs to make forex available to industrialists so that they can bring in raw materials. The government should also put policies that will make naira appreciate and make exchange rate available.
I appeal to the government to provide more incentives for the economy to stabilise so that we will have more industries in Nigeria. One of the ways to ensure that is to improve access to capital. If the government gives incentives for machines to be brought into the country and there is no working capital, it will not help. That is why you find many moribund industries in the country.
The government should provide more money to the Bank of Industry so that they will provide more capital to industrialists and also make the process of accessing the loans easy. •Chief Hezekiah Adedeji (President, Kwara Coalition of Professional and Business Associations)
The third quarter output report of the National Bureau of Statistics which indicates a further contraction in Gross Domestic Product by as much as 2.24 per cent did not come as a surprise to any keen follower of developments in the Nigerian economy.
Since, the economy officially slid into recession following two consecutive quarters of negative growth of -0.36 per cent and -2.06 per cent during the first and second quarters respectively, there has been no real policy, whether fiscal or monetary, to stimulate output.
The decision by the Federal Government to effect a cut on import duties in respect of 115 items across critical sectors of the economy will go a long in stimulating industry capacity utilization, increase output, reduce inflation, as well as strengthen the country’s relations with foreign countries, especially ECOWAS member states.
Fiscal policy in times of recession should be expansionary. So, I think reduction of the import duties is a right step in the right direction. I am equally of the view that monetary policy should toe the same easing path till the economy is out of the woods.
The loss in government revenue as a result of this measure in the short term will be more than compensated by the boost in economic activities in the medium term, especially given the fact that most of these items affect the real sectors of the economy.
It is also noteworthy that the import substitution drive of the government is sustained by the ban on items that can be produced locally such as fruit juice and foot wears. •Dr Uche Uwaleke (Head, Banking and Finance Department, Nasarawa State University)
The reduction of import duties on 115 items may not necessarily boost the economy because in the economy, different sectors are interrelated. You cannot say you are reducing import duties and you are increasing same in some sectors. For example, you are banning the importation of vehicles by land borders, you have also gone ahead to scrap the relevance of our naira credit card and Nigerians can no longer use it for international transactions, effective from January 1.
So, all those, who have credit cards, cannot use them for foreign transactions and by so doing, the government is simply stifling the economy. In making policies, you must look at it from a very holistic perspective.
Not too long ago, a former Minister of Finance, Dr Ngozi Okonjo-Iweala, gave reasons why the economy went into recession and she was very correct. First of all, when you create an atmosphere of fear and apprehension, investors will move their funds to a safer haven. When you also make access to foreign currency difficult in a global economy, certainly you are going to create serious problems, because the economy is fast becoming part of a global village and you cannot isolate your country from the happenings in other parts of the world.
I think the Federal Government needs to think through its policies; economic policies are not things you deal with in a draconian manner. You need to be able to plan. The manufacturing sector is stifled because the running cost is going high every day. •Dr Stanley Ogoun (Chairman Academic Staff University Union, Niger Delta University)
For some of us who are importers of goods, the reduction in import duties on some items announced by the Federal Government is a welcome development. It will certainly affect the economy in some positive ways.
For example, the reduction of import duties on alcohol for medical pharmaceutical or scientific purposes and other items needed by local manufacturers will certainly lower the cost of production of the goods they are used for. The cost of local production of goods they are used for will come down. This will reduce the prices of some goods, and subsequently it will lead to higher demand which is basic economics. The lower the price, the higher the quantity demanded.
It is a step in a right direction and this may also encourage some Nigerians in the Diaspora to come back home and contribute their quota to the development of the nation. Many of them have lost their jobs, but they are not willing to return home because of the fear that the business environment is very hostile. But with this, they will be encouraged to return to Nigeria.
If there is a downward review of import duties on more imported goods, I can assure you that many Nigerians, who have been out of jobs in Europe, will certainly return home and they can use their expertise and money to boost the economy.
But I think the Federal Government can also extend the import duties reduction to some other items like machines and papers to further help artisans and those in the education sector. •Mr. Gbenga Balogun, (An importer and Director, Nuova Genesis)
There is a marked difference between policy statement and actual implementation that will trickle down economically and benefit the ordinary people. I am thinking that the policies we are looking at right now are policies that will benefit less than five per cent of the population. That is why inflation is still on the rise and that is why there is no dollar. The reason we are talking about this is because any country that has nothing to export will experience hard currency scarcity.
We are a consumption-based country; we are not exporting anything. Oil prices melted and we are looking for dollar. What do we need dollars for? We need dollars because we want to sustain our rapacious lifestyle. Some of the (115) items listed are items that can be produced in Nigeria.
Government should ensure policy consistency and any leader that goes against any of such policies should be democratically removed so that the country can move forward. What they are doing is selective import waiver. Obasanjo did it, Jonathan did it. Yar’Adua did it. Successive military governments did selective import waiver. •Dr William Wodi (A public affairs analyst)
Compiled by Success Nwogu, Simon Utebor, Femi Makinde and Ifeanyi Onuba
Punch
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