LCCI Canvasses Reduction Of $38 Budget Benchmark
THE Lagos Chamber Of Commerce and Industry (LCCI) has taken a swipe at the proposed 2016 budget, with conclusion that the $38 per barrel benchmark appeared fragile. It therefore advised government to lower the benchmark for a realistic budget.
The chamber in a statement by its president, Dr. Nike Akande, came to that conclusion because of the continued and projected boost of supply side of oil at the international market and its potential impact on oil price.
Akande also commented on the exchange rate benchmark in the 2016 budget, describing it as conservative.
“Exchange rate benchmark of N197 to the Dollar in the 2016 budget appears too conservative and at variance with prevailing realities. We hold that the exchange rate benchmark should be adjusted to N220 to the Dollar threshold in the 2016 budget,“ she said.
The chamber commended the government for reducing fuel subsidy allocation from N1 trillion to N63.29b next year, saying it is a welcome development. It also hailed the government for zero allocation for kerosene subsidy, which it said had been one of the greatest burdens over the years. “
Noteworthy is the provision of zero allocation for kerosene subsidy, which has been one of the biggest burdens over the years. The reduction of Federal Government’s share of fuel subsidy to N63.29b compared to almost 1trillion spent on subsidy in 2015 is also a welcome development. These will definitely free up resources to finance other priorities, especially infrastructure. We reiterate our call for deregulation of the petroleum down stream sector in order to reduce the pressure on government finances and the foreign exchange market.