As stakeholders in the nation’s economic landscape continue to recount the bitter experiences of the impact of the COVID-19 pandemic on their operations, the gradual but steady policy measures by the federal government to re-open the economy has been eliciting reactions among experts as they set post-recovery roadmaps for operators across the broad sectors of the nation’s economy.
Reflecting on the state of the real sector and the post-pandemic strategy, the Coordinator, Abuja Chamber of Commerce and Industry’s Policy Advocacy Centre (PAC), Olawale Rasheed, told Daily Trust that the implementation of Ease of Doing Business reforms had advanced the organised private sector and canvassed the need for its consolidation through policy measures in order to grow the sector.
“We can testify that registration of business names is easier and cheaper now,” he said.
Similarly, the president of the chamber, Prince Adetokunbo Kayode, projected that the real sector of the economy would benefit immensely from the AfCFTA if the government explores the advantages of the country’s population and productivity to dominate the African market.
In his remarks, the National Vice Chairman (North Central) of the National Association of Small and Medium Enterprises (NASME), Engineer Auwal Bununu, said government’s policies for the real sector should focus on supporting businesses to survive COVID-19.
According to him, the N50 billion Central Bank of Nigeria intervention fund created to cushion the impact of the pandemic on MSMEs is good but should be increased to N1 trillion.
Banking Sector
Apart from its various interventions which many analysts believe are desirable for improved credit to all sectors of the economy, some experts spoke on the latest efforts of the CBN charging the government to immediately re-open the economy as desirable to post-pandemic economic recovery agenda of the government.
Dr. Iorwuese Tyopev, an economist at Falvey Consulting, said the CBN’s decisions are impressive.
“It is a welcome development from the CBN. It is a normal thing in an emergency situation like this. What is happening is not different from a war situation. We can’t sit and fold our hands on the economy because we have health challenges.
“We can see that in Kano, I understand that many of the deaths there were attributed to hunger and poverty. More people will die of hunger than of COVID-19,” he noted.
“The impact of the economy in the three months of lockdown is huge and the reduced interest rates will enable businesses access funds and generate employment. It will also enable small and medium scale industries survive post COVID-19,” he added.
Prof. Uche Uwaleke, a capital market expert said, “The MPC decision to cut the benchmark interest rate by 100 basis points down to 12.5% is a demonstration of the CBN’s sensitivity to the need to stimulate the economy and enable it withstand the negative impact of COVID’19 as well as the drop in oil revenue.”
“Having signaled the intention to adopt an accommodative stance in favour of growth, the CBN should put in place measures to ensure that it translates to lower lending rates by the banks to the real sector of the economy,” he said. He also agreed on the gradual restarting of the economy to save livelihoods.
Power Sector
The chairman, Nigerian Electricity Consumers Association of Nigeria (NECAN), Chief Tomi Akingbogun, said the five years of the Buhari administration had resolved little of electricity consumers’ challenges.
“All electricity consumers should by now have electricity pre-paid meters, and estimated billing should have been stopped,” he said.
Akingbogun said the Nigerian Electricity Regulatory Commission (NERC) should now be a fair umpire in the Nigerian Electricity Supply Industry (NESI).
“NERC should enforce the law and not change the laws to the convenience of the DisCos. TCN should have been privatized for efficiency,” he noted.
On the best way forward, he said consumers must be given top priority in the power sector. “There should be no increase in tariff until all consumers are metered and proper cost versus income audit is done for the power firms,” said Akingbogun.
The Executive Director, PowerUp Nigeria, a power consumer-focused initiative, Mr. Adetayo Adegbemile while noting that the first challenge for government in the power sector was the increase in electricity tariff in February 2016, and the roll out of the Power Sector Recovery Plan (PSRP) by April 2016 which he said had issues that were not fundamental to the sector.
On the way forward for the sector in the post-pandemic era, Adegbemile said NERC needs to be more independent, as the Ministry of Power still has more work to do in coming up with helpful policies.
“When we say panacea, attention should be strictly paid to the whole architecture of the power sector,” he said.
Aviation
In addressing challenges posed to the aviation sector by the pandemic and what airlines and other industry stakeholders should do to survive post COVID-19, a travel and logistics expert, Mr. Alex Okosun, said they must innovate.
Okosunm, a fellow of the Chartered Institute of Logistics and Transportation (CILT) and branch chairman of CILT in Abuja, told our correspondent that COVID-19 had disrupted the travel industry beyond measure and it would take a long while for the industry to be up again.
“The travel companies will need to carve out headroom in their operating model to foster innovation. They will need to build an innovation engine that runs parallel to their everyday operations. They will need to show improvement in their contributions to the natural environment and human performance while also demonstrating that they have a business model that can sustain the effects of another event like COVID-19,” he said.
Looking beyond the immediate future, he said, “The COVID-19 outbreak has resulted in dramatic disruptions to travel, leading to new paradigms and many cases, permanent shifts.”
He said companies would be forced to make quick decisions to ensure short-term confidence and longer-term business sustainability.
“What will be needed to meet the urgency of today and the demands of tomorrow? All travel companies must immediately decide how they will improve their business models,” he added.
He also indicated that companies must re-size and re-engineer their organization for new life.
“Many will apply new technologies to facilitate immediate responses, but these could pave the way for longer-term strategies that improve overall resilience and competitiveness,” he stated.
AMCON backs airlines rescue
Mr. Aminu Ismail, the Executive Director Operations at Assets Management Company of Nigeria, canvassed the need for urgent bailout for the sector given the crippling effects of COVID-19 pandemic.
Ismail pointed out that given the critical nature of the essential services rendered to the economy by the sector, government should stabilize the operations of airlines, at least for now in order to revitalize the carriers and enable them fulfill their debt obligations.
He said: “Aviation in Nigeria has historically been fraught with many challenges including poor capital structure, difficulty in accessing finance, difficulty in accessing cost effective leases, high insurance costs, difficulty in accessing forex for maintenance and spare parts, multiple taxation by government agencies, weak corporate governance structure, lack of airport infrastructure and very marginal share of the lucrative regional flights of under 20 per cent.
“AMCON is in support of any bailout from the government that would ensure the continued survival of the airline industry in Nigeria. However, any intervention in the aviation industry this time around must be directed at the core areas of need and should not become a jamboree.
“If the intervention comes in the form of grants, it must be to fund operational losses, which must be basically intended to save jobs and reimburse for operational losses induced by the COVID-19 pandemic and promote local content, the intervention should focus on reducing dependence on foreign companies for pilot training and aircraft maintenance,” Ismail added.
Revenue Generation
As a desirable fiscal step towards revitalizing the economy, the Nigerian government was charged to intensify effort at diversifying the nation’s economy to generate more revenue from different sources, given its vast human, natural and solid mineral resources.
The National Chairman of the National Association of Auctioneers, (NAA), Alhaji Aliyu Kiliya, said: “Nigeria should seize the opportunity of the growing demand for many of its vast human, natural and solid mineral resources to diversify the economy towards uplifting the country towards growth and development.” He urged auctioneers to support the economic efforts of both public and corporate sectors in their post-pandemic economic recovery agenda for the benefit of the country.
Health experts on the way forward
Dr Francis Ohanyido, a public health expert, stressed the need for the federal and state governments to put in place mechanisms to ensure protection of the citizens, saying government should ensure adherence to protective measures such as use of face masks, hand washing and social distancing as the economy reopens.
“Restrictions will be lifted at one point or the other as a result of economic considerations because the more people are impoverished, the more government may be in trouble. People would have to be practically forced to adhere to lock down or restricted movement when they are hungry and their livelihoods are affected,” he said.
Dr Ohanyido said government should also ensure community engagement on COVID-19 so that more people would be educated on it and protect themselves.
Dr Audu Onyemocho, an epidemiologist and associate professor of community medicine, said adherence to disease infection and prevention measures is still poor among the populace.
He said a return process to the economy that would be without compromising safety should involve enlightening the public and ensuring strict adherence to the use of face masks, social distancing , washing of hands and other disease prevention and control measures.
