ANAN calls for true deregulation by CHARLES NWAOGUJIFriday, November 20, 2009

Immediate past President of Association of National Accountants of Nigeria (ANAN), mr. Samuel Nzekwe, has called on the Federal government to stem tide of outward flow of investment to other West African countries. Nzekwe believes that the outward flow of investment out of Nigeria is necessitated by unfavourable investment climate in the country.

he told Daily Sun in an interview in Lagos that there is no way the economy of the country can move forward without adequate electricity, security, infrastructure, education and efficient judicial system.

said him: “We don’t need God to come from haven before we can repair our roads. The roads in the country have become death traps, especially at Ore-Benin road linking the South-East and South-South. “How can you create wealth without power; the artisans, market women need electricity as a matter of necessity to be able to sustain their business. I therefore call on Federal government to refocus and kick start the economy by putting in place adequate power, infrastructure (including road, security and education).”

On the financial sector, which is a catalyst for the growth and development of the real sector, he said it has not performed well. he noted that there is a total disconnection between financial and real sectors of the economy caused by shortage of long-term funds, which the real sector requires for necessary growth and development. he said that there is urgent need to deepen and diversify the financial products. The regulators of the financial sector should ensure sustained stability and avoid policy summersault so as to ensure investors’ confidence. there is need to always harmonize fiscal and monetary. he gave kudos to Central Bank of Nigeria (CBN) Governor, Sanusi Lamido Sanusi for proactive measures to make stone sure that no bank collapses.

he commendable CBN governor’s effort, and further advised that they have to keep watch so that nothing bad happens to the banks because according to him, if anything should happen again, nobody will patronize banks again. On de-regulation, he said that persistent increases in the ex-depot price of LPFO automatically affects the price of gas, which was cheaper and safer alternative source of power supply in the country. he noted that this development which is inimical to the growth of the manufacturing sector is capable of stirring up restiveness within the sector.

as a palliative measure, he called on the government to implement a new gas price in the form of a subsidy akin to the electricity multi year tariff system recently put in place in the power sector. according to him, this would go a long way to reduce the excessive exogenous induced operating cost, thereby making Nigerian products competitive. “I foresee a situation if the gas price regime is not tackled serious, this may stir up restiveness in the manufacturing sector and the entire economy, which may result to investment closures and movement of industry from Nigeria to other countries in the sub-region,” he said.

he said that a de-regulation scheme that do not dismantle government price fixing machinery like the Petroleum Product Pricing Regulatory Agency, Petroleum Equalization Fund and the corruption ridden Nigerian National Petroleum Corporation (NNPC) will only unleashed more hardships on the people and wipe out the already crippled Nigerian businesses tethering on the precipice due to high cost of energy amid Nigeria’s ceaseless power outages.

he pointed out that true deregulation must address the issue of ownership and control of essential infrastructure, the issue of private refineries; private sector participation in the ownership of pipeline and maritime loading and discharge point he noted that Nigeria requires a deregulation scheme that will create an enabling environment for the private sector to actively participate in refining and sourcing of petroleum products for the ultimate consumer. “If government failure this time around to implement true deregulation but engage in mere price increase will deepen peoples mistrust of government even as it will further aggravate the present national economic crisis,” he added.

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