By Toye Olori
LAGOS, Oct 27 1999 (IPS)

For the first time in 16 years, Nigeria’s budget will be prepared and presented to parliament by an elected government, on Jan 1.

. Unlike those imposed by former military regimes, next year’s budget, according to economists in the commercial capital of Lagos, will be people-oriented. It will tackle the country’s battered economy, while laying emphasis on poverty alleviation. Tommy Nwankere, a business analyst in Lagos, is optimistic that the budget will address the pressing issues of poverty. “If the recommendations of operators of the economy and industrialists are accepted,” he says, “next year should be a year of economic revival for Nigeria”. Already, the Organised Private Sector (OPS), comprising the Manufacturers Association of Nigeria (MAN), the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) and the Nigeria Employers’ Consultative Association (NECA) as well as the National Economic Summit (NES), has been discussing how to revamp Nigeria’s economy. OPS is lobbying to influence policies towards economic revitalisation, growth and development in the year 2000 in a bid to alleviate the sufferings of the masses and ensure the growth of democracy in a country ruled by the military for 29 of the 39 years of its independence. In a statement, made available to IPS this week, the OPS says the Nigerian economy witnessed a mixed performance in 1999 with some sectors recording relative improvement while others experiencing outright decline. “The economic activities were hampered by poor infrastructural support services, weak domestic aggregate demand and low capacity utilisation,” it says. Inflation rate, according to the OPS, resumed an upward trend from a single digit of 9.8 percent in December 1998 to a double digit figure of 12 percent in June. Interest rate also witnessed a dramatic escalation thereby discouraging industrial investment, it says. To revamp the economy, the OPS has suggested a number of measures including restoring 25 percent duty rebate on imported raw materials, machinery and spare parts; harmonising the deregulation of the foreign exchange market with monetary and fiscal policies in order to strengthen the value of the naira, Nigeria’s national currency. It also urged the government to commit itself to ensuring a regime of lower personal and corporate tax towards enhancing the purchasing power of the consumers and stimulating reinvestment in industry and serious commitment to promoting local products. OPS’s recommendations were supported by the Nigerian Economic Summit group (NES) which has identified seven key areas to ensure growth and empower Nigeria’s fledgling democracy. The NES has identified agriculture and poverty alleviation, manufacturing — with specific emphasis on small and medium scale industries — mineral resources and privatisation of loss-making state-own corporations. Presenting the document to government, Pat Utomi, urged the authorities in the capital Abuja to adopt the leapfrog concept in incorporating and implementing the recommendations for the 2000 budget. NES said for agricultural programmes to impact positively on Nigerians, the government of Obasanjo, which came to office in May following 16 years of military rule, should allow market forces to determine the pricing of fertilizer. It also argued that government should in the first half of next year align agricultural policies to enable the nation benefit from numerous bilateral and multilateral agricultural funds. On manufacturing industries, the group agreed with the OPS proposals to reduce duty on raw materials to five percent from the current 15 percent. It also recommended the elimination of duty on machinery and spare parts, higher duty on imported finished goods, increase in public sector remuneration, slash in income tax to a maximum of 15 percent. According to NES, the 2000 budget would only be considered friendly to manufacturers if government reduces corporate tax to 20 percent from 45 percent, abolish Value Added Tax (VAT) on raw materials, encourage competitive regional ports and implement 24 hour port operations. Finance minister, Adamu Ciroma, hinted in August that government was planning tariff review and tax cuts next year in favour of low income earners.

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