…Says Govt Spending Expanding At Expense Of Private Sector Growth
…Claims Tinubu’s Economic Reforms Not Working
The Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) has warned that the N13.39tn deficit in the 2025 budget will put pressure on the naira and lead to its further depreciation against the United States dollar.
The President of NACCIMA, Dele Oye, said this on Tuesday in an interview on Arise TV, monitored by THE WHISTLER.
President Bola Tinubu had presented the N49.7tn Appropriation Bill to a joint session of the National Assembly on December 18, 2024, and requested that the lawmakers pass it expeditiously.
The budget has a revenue projection of N36.35tn which is 40.51 per cent rise from the N25.87tn in 2024 and a deficit of N13.39tn, up by 45.86 per cent from the N9.18tn deficit in the 2024 budget.
But, the NACCIMA president said that the budget will crowd out the private sector, which could lead to a worse economic crisis.
Oye lamented that the current inflation and foreign exchange woes resulted from poor policies and the government outspending its revenues.
He said, “There is the tendency of the government trying to borrow or increase taxes to fill the gap. If you do that, you only make Nigerians poorer.”
In 2014, Nigeria was the biggest economy in Africa with a GDP of $568bn but the numbers have crashed to $191bn in 2024.
He said, “This year’s budget is far lower in real terms than last year’s budget. Look at our standing in the African GDP, we are about number five and may be going to six.
“All these are due to domestic policies that have been made like deficit financing. What you are seeing is that the private sector is shrinking and the public sector is expanding.”
The naira closed in the full year of 2024 at N1,650 per dollar as against around N1,000 per dollar in January 2024.
Experts have blamed the depreciation of the currency on policies, including the floating of the naira in June 20203 and other policy misfires.
The NACCIMA boss said economic indices show that government policies failed in 2024.
Oye said, “NACCIMA is not advocating for the reversal of government reforms. What we are asking is that the way it is currently being implemented will not lead us anywhere.
“This government has been here for almost two years. If it is not working and the economy is shrinking, it is time for the government to change the procedure.
“The reason why the naira is falling is because the government is running a deficit budget. A N13tn deficit? What do you expect? it is going to affect the value of the naira.
“If we cut government expenses, the naira will start to appreciate. Until you cut the excess, we are going to continue to borrow in an uncontrollable way and you can see the effect- our naira will continue to go down.”
He called for proof that government policies are working, adding that the government should suspend any tax raise.
He added that last year, president Tinubu made several foreign trips to woo investors, adding that Foreign Direct Investments (FDI) are far below expectations.
