The PwC Nigeria has advised federal and state governments to evolve policies that would unlock $900 billion worth of dead capital tied unproductively in residential real estate and agricultural land.
This, they stressed would support wealth creation and accelerate economic growth in this dire and austere period.
PwC Nigeria gave the recommendation during a webinar titled, “Assessment of Government Economic Interventions and the Way Forward,” which it jointly with the Lagos Chamber of Commerce (LCCI).
The Advisory Partner and Chief Economist, PwC West Africa, Dr. Andrew S. Nevin, urged the governments to also, “restructure its fiscal plan especially spending on non-essential projects and carefully manage the risk of debt trap that could result from increasing debt accumulation.”
Nevin said government should, “put in place framework that ensures transparency and accountability across ministry, departments and agencies and aggressively promote peace and tranquility across the country in order to attract patient capital.”
“Incidences of insecurity and insurgence are drawbacks to the implementation of intervention measures while consistent decline in Nigeria’s corruption perception index from 28 in 2016 to 26 in 2019 is also a major concern to foreign investors,” he said.
He noted that, “rising debt accumulation and cost of debt services to revenue ratio at 99 per cent does not bode well for fiscal consolidation.”
Speaking during the conference, the Fiscal Policy Partner and West Africa Tax Leader at PwC, Mr. Taiwo Oyodele, noted that challenges facing businesses in the country today are multi-dimensional ranging from liquidity and availability of cash to pay bills to safety of personnel and infrastructure to work from home.
Oyedele, said government should remove subsidies, rationalise waivers, leverage on digitalisation and technology adoption and aim at expanding the tax base in a manner that would exempt the poor and ensure that “everyone else pay according to their ability.”
He further urged the government to stimulate the economy by creating enabling environment and removing artificial barriers. The norm, according to him, should be, “no new taxes, no higher rates and no additional compliance burden.”
He also advised businesses to, “rethink their competitive advantage, enhance productivity, improve customer satisfaction, access government stimulus and re-prioritise for liquidity and cash flow optimisation.”
“Business leaders need to take steps to address the challenges they face and leverage on the opportunities presented by the pandemic.”
The Chief Executive Officer of the Economic Associates, Dr. Ayo Teriba, warned that the government should desist from generalisation of the effects of the COVID-19 on businesses in a manner of one size fits all approach as if every sector was suffered equally.
“We need to zoom in on the sectors that were actually hit by the lock down and pay attention to them in proportion to their losses. We will not treat all the sectors as the same,” Teriba said.
The President of the LCCI, Mrs. Toki Mabogunje, in her opening remark said that “the business environment, to date, is still feeling the heat of the crisis of COVID-19 as existing business operators are increasingly finding it difficult to support margins and meet contractual obligations due to revenue shocks precipitated by the disruptions.”