LCCI Calls for Diversified Debt Management Approach

The Lagos Chamber of Commerce and Industry (LCCI) has issued a recommendation to the federal government, urging them to explore alternative strategies for managing the country’s debt, including the potential sale of underutilised assets. This suggestion was articulated by Gabriel Idahosa, the President of LCCI, during the chamber’s first quarter economic address. A primary concern highlighted by LCCI is Nigeria’s high debt service-to-revenue ratio, currently at 73.5 percent, posing an unsustainable fiscal challenge.

According to Idahosa, Nigeria’s public debt is projected to reach at least N95.2 trillion by the end of December 2023. The substantial debt service poses a significant obstacle to the government’s ability to deliver essential services and invest in critical infrastructure. Further contributing to the public debt burden is the recent approval by the National Assembly for the securitisation of the outstanding debit balance of N7.3 trillion owed by the federal government to the CBN, resulting in a surge in public debt stock to at least N95.2 trillion.

LCCI emphasizes the imperative for government intervention in addressing the mounting debt burden. The chamber suggests that the government should explore the potential of underutilised or unutilised assets as a means of generating revenue and reducing the necessity for further borrowing. Chineyere Almona, Director General of LCCI, emphasised the significance of optimising government-owned assets, an aspect often overlooked in discussions about national debt.

Additionally, LCCI has proposed diversification into the solid minerals sector as a means to decrease the country’s reliance on oil revenues, potentially leading to job creation and economic growth. However, the successful implementation of this policy may face challenges such as regulatory obstacles, inadequate infrastructure, and bureaucratic inefficiencies. Idahosa also expressed concerns about unregulated mining activities potentially resulting in environmental risks such as deforestation, soil erosion, and water pollution.

The chamber’s recommendations underscore the pressing need for proactive measures in managing the country’s debt and exploring new revenue generation avenues. LCCI’s proposals centre on enabling the private sector to thrive and contribute to the country’s economic development. By addressing public debt and diversifying revenue sources, the government can create a more sustainable and resilient economy for the benefit of all Nigerians.

In conclusion, LCCI’s plea for a diversified approach to debt management is a crucial step towards achieving a more stable and dynamic economy. The government must seriously consider these recommendations and work towards implementing policies that will foster economic growth and alleviate the public debt burden.