The Nigeria Employers’ Consultative Association (NECA), has said organized businesses are overstretched due to the inflation in cost of living, caused by the increase in the price of petroleum motor spirit (PMS).
In a statement on Thursday, the Director-General, NECA, Mr Adewale-Smatt Oyerinde, advised the government to take more effective steps to stop the slide into hopelessness for the organized businesses and Nigerians in general.
Oyerinde showed concerns that the rising cost of living was already hurting Nigeria’s poverty and production index.
In previous year, he said, the country witnessed perpetual rising inflation, commodity price instability, reduced industry capacity utilisation, and a gradual dwindling of the purchasing power of Nigerians.
These, he said, had kicked many enterprises out of existence, and Nigerians below the poverty lines.
He said, “While the current administration has lined out policy plans to improve the living standards of the masses, such plans must be backed by deliberate and quick responses.
“As it is obvious to all, there is rising agitation owing to the rising cost of living, compounded by the increasing cost of PMS and the threat of increment in electricity tariff amongst others.
“While we commend the removal of fuel subsidies, renewed efforts at curbing oil theft, and the ongoing attempt to reform the tax administration, it is, however, important that government take more drastic steps to stop the slide into hopelessness by Nigerians and indeed organised businesses.”
The NECA boss said production plans were persistently displaced by frequently changing factors.
According to him, “It is instructive to note that businesses and households are currently being over-stretched beyond their shock buffers. Already, there is a drag on business operation as production plans are persistently displaced by frequently changing factor costs, and households are constantly adjusting consumption to accommodate their inadequate real income.”
He added that “At this breaking point, it is imperative for government to quickly take deliberate actions to mitigate the persistent rise in inflation to address the fast-accelerating cost of living in the country.
“Such actions may include price stability mechanisms, periodic feedback on the progress of the ongoing work at the refineries, reversal of the value-added tax on automotive gas oil, and suspension of the planned upward review of electricity tariff.”
