The Lagos Chamber of Commerce and Industry, LCCI, has warned that the
economy would lose an estimated N150 billion daily, if the proposed strike by
PENGASSAN
and NUPENG is not averted.
The Director-General of LCCI, Muda Yusuf, disclosed this in an interview
with the News Agency of Nigeria on Monday in Lagos.
Mr. Yusuf said that it would not be a good development for an economy
that was just emerging from recession.
NAN recalls that the two unions had threatened to embark on an indefinite
strike over delay in the payment of N800 billion subsidy arrears to oil
marketers.
Mr. Yusuf urged the federal government to engage the unions and propose a
credible payment plan to settle the arrears.
He noted that the consequences of the proposed strike would be severe
because of the strategic and critical nature of the oil and gas sector.
“It would paralyse the chain of logistics in the economy as economic
activities are driven largely by road transportation, both for commuting and
freight.
“It will impact on revenue as the upstream sector would be affected as
well. It would impact the power sector which is largely powered by gas,” he
said.
The LCCI boss noted that the fuel subsidy phenomenon had become a
recurring distraction in the management of the country’s economy.
“It is regrettable that government has over the years got itself
entangled in a problem which should not have arisen in the first place,” he
said.
He alleged that the country’s economy had suffered serial scandals and
monumental corruption in the oil and gas sector because of the phenomenon of
petrol subsidy.
“We have consistently argued that the government should completely
decouple itself from the business of importation, refining, transportation and
retailing of petroleum products.
“This arrangement has created considerable distortions and stagnated
private investment in the downstream sector because these are enterprises that
the private sector is best suited to manage,” he said.
Mr. Yusuf said that government has no business fixing prices and
subsidising the players.
He said that in spite of the monumental problem the economy had from the
subsidy regime, government has not taken urgent steps to put an end to price
fixing for PMS.
“The economy cannot sustain this arrangement. The current debt of N800
billion is 151 per cent of the total capital allocation for the Federal
Ministry of Works, Power, and Housing in the 2017 budget.
“It is 1,568 per cent of the capital allocation to health; it is 305 per
cent of the capital allocation to Federal Ministry of Transportation; and 1,600
per cent of the capital allocation to education.
“This raises vital questions about the optimality and efficiency of
resource allocation and utilisation by government,” he said.
He called for speedy passage of the Petroleum Industry Bill (PIB), adding
that it will help to normalise the oil and gas sector.
Mr. Yusuf urged the government to replicate the telecoms sector model in
the oil and gas industry, adding that it would free resources for investment in
critical infrastructures like power, roads, the railway, health and education
sector.
He stressed that the model would improve product availability, eliminate
fuel queues, and create more jobs for the teeming youth in the downstream oil
sector.
(NAN)
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