ASABA/Nigeria: At the 2023 Federal Accounts Allocation Committee (FAAC) retreat themed “Creating a resilient economy through diversification of the nation’s reserve base,” held at the Events Centre in Asaba, the Delta State capital, Governor Sheriff Oborevwori highlighted several impediments stifling both local and foreign investments in Nigeria.
Speaking through his Deputy, Sir Monday Onyeme, Governor Oborevwori voiced concerns over the harsh and hostile operating environment, inadequate infrastructure, security issues, and policy inconsistencies plaguing the nation’s business landscape. These, he stressed, were deterring factors for potential investors.
He emphasized the need for substantial changes in the ease of doing business in the country, advocating for the removal of institutional bottlenecks that hinder economic progress. Specifically, he lamented the low tax to GDP ratio, hovering around 10-12%, which leaves Nigeria vulnerable to global economic disruptions.
“A thriving private sector is pivotal to a strong, resilient, and competitive economy. Yet, structural weaknesses, lack of organization, and formidable challenges characterize our private sector,” Governor Oborevwori remarked.
The Governor also expressed discontent with the Central Bank of Nigeria’s (CBN) perceived lack of responsiveness to demands made by FAAC regarding the management of the Federation Account. Additionally, he urged swift action by the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) in verifying previously submitted government data.
Governor Oborevwori commended FAAC members for rectifying computation errors and facilitating refunds to oil-producing states. However, he underscored the necessity of addressing outstanding issues concerning the 13% derivation since the enactment of the Petroleum Industry Act (PIA).
He stressed the vital role of tax revenue in fostering a thriving private sector and called for urgent measures to alleviate the high cost of doing business in Nigeria. Moreover, he urged concrete actions to drive economic diversification and stimulate non-oil exports, highlighting the establishment of a Trade and Export Unit in Delta State as an example of proactive measures.
The retreat, attended by key stakeholders such as Commissioners of Finance, Accountants-General of States, NNPCL, Revenue Mobilisation Allocation and Fiscal Commission, Federal Inland Revenue Service, Customs, and other revenue-generating bodies, aimed to address these critical issues hindering Nigeria’s economic growth.
Earlier in his address, Chief Olawale Edun, representing the Minister of Finance and Coordinating Minister of the Economy, acknowledged crucial reforms initiated by the Bola Tinubu administration. These reforms focused on petroleum subsidy removal, fiscal and monetary policy restructuring, and garnered praise from both local experts and international partners.
Edun emphasized the significance of these reforms in bolstering the Federation Account’s revenue inflow, citing an increase from an average of N650 billion monthly to over N1 trillion in the past four months. He reiterated the administration’s commitment to considering Nigerians’ welfare while pursuing tax-related objectives.
The ongoing retreat signals a concerted effort among key stakeholders to address economic challenges and implement reforms vital for Nigeria’s sustainable economic growth and stability.
