The Centre for the Promotion of Private Enterprise and the Lagos Chamber of Commerce and Industry have identified declining productivity as a detrimental factor affecting economic growth within the country.
Both the economic think-tank and the commerce chamber expressed this concern in response to the National Bureau of Statistics’ Gross Domestic Product report for the second quarter of the year.
According to a statement provided to The PUNCH, the CPPE noted that the adverse impacts of recent economic reforms were more significant than anticipated. The Chief Executive Officer, in the statement, emphasized that while the current disruptions in the economy are addressed, a resurgence is expected in the medium to long term.
The statement elaborated, “The existing vulnerabilities in the economy’s structure persist, particularly pertaining to challenges related to productivity and competitiveness within the real economy.”
“The Q2 GDP growth fell short of the sub-Sahara projected average of 3.1 per cent for 2023; but better than projections for the Euro Zone of 1 per cent and the United States of 1.8 per cent.”
Yusuf further pointed out that a number of industries, including oil refining, livestock, crude oil and gas, and textiles, are all experiencing a downturn as a result of macroeconomic, structural, or policy concerns.
He added, “Growth in these sectors continued to be subdued by heightened inflationary pressures, exchange rate volatility, spiking energy cost, insecurity and the political economy of the oil and gas sector.”
The Deputy-President of the Lagos Chamber of Commerce and Industry, Gabriel Idahosa, blamed the recent economic changes for the drop in productivity in the nation’s real economy in an exclusive interview with The PUNCH.
He continued by saying that the circumstance had contributed to the nation’s currency issue, which had made things challenging for the business community.
Idahosa said, “It’s unsurprising that trade isn’t at the level it should be. These economic reforms have been pushing the economy in one direction. The value of any currency is export minus imports. So, if we manage to push exports up, over time the trend will reverse.”