Rise in poverty, risk to democracy, security – says LCCI

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By Usman Sulyman

The Lagos Chamber of Commerce and Industry says the rise in poverty in Nigeria posed a great risk to Nigeria’s democratic process and security.

The chamber on Sunday in her reports on Nigeria’s Democracy at 21, said Nigeria’s Gross Domestic Product, Foreign Direct Investment, foreign exchange rate, and lending rate, among others, were all weak between 2015 and 2019.

Admitting the fact that the outbreak of COVID-19 and the unprecedented collapse in crude oil prices impacted most macroeconomic variables, and the fact that the full-year data was not available for 2020, the LCCI said it reviewed the country’s economic performance in 2015 against 2019 for a fair assessment and comparative analysis.

The chamber, which had its sources as the Central Bank of Nigeria, the National Bureau of Statistics, the Debt Management Office, and the Nigerian Stock Exchange said the country’s macroeconomic principles were largely weak and remained the same till date.

LCCI said, “these yardsticks including FDI, the balance of trade, and exchange rate were driven to a significant extent by the direction of crude oil prices, an external cause beyond the control of economic managers and policymakers.

“During periods of shocks in the global energy markets, most macro indicators are thrown into negative territory.

“Performance was negative in the following areas, GDP growth, inflation, FDI, public debt, stock market’s All-Share Index, exchange rate, and maximum lending rate within the period reviewed.”

It added, “more importantly, we note the decline in FDI flows into the country driven by weak investors’ confidence resulting from heightened regulatory risks, state of infrastructure, policy risks, and quality of dispute resolution systems, among others.”

The chamber noted that there was moderate improvement in foreign reserves within the period, adding that this could be ascribed to favourable oil prices.

Quoting data from the World Bank, the NBS, and Oxfam, the chamber said: “the present administration’s performance, from a socioeconomic and welfare perspective, was not up to scratch.”

It said, “The data on trends in per capita income, poverty, unemployment, and food inflation support this position. Per capita income fell steadily between 2015 and 2018.”

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