ICAN: Delayed passage of 2019 budget may sabotage growth prospects

Institute of Chartered Accountants of Nigeria (ICAN) have said that the delayed passage of the 2019 budget and slow investment choices that may arise as a result of expectations from the general elections may stall Nigeria’s growth prospects in 2019.

ICAN disclosed this during the institute’s Economic Discourse Series titled, ‘2019 Economic Outlook’, positioned to proffer feasible social and economic interventions in the country, devoid of sentiments and parochial interests.

Speaking at the event in Lagos, ICAN President, Razak Jaiyeola, said among other factors, the security challenges in the country, projected decline in crude oil prices in the global market, the coming general elections and developments in other trading economies may affect the country’s economy negatively.

He noted that in sub-Saharan Africa, growth is expected to pick up from about 3.1 percent in 2018 to 3.8 percent in 2019, but however would still be a far cry for stimulating the expected jobs to meet the demand of the growing population in the region.

Speaking further, he said the World Economic Outlook by the International Monetary Fund (IMF) projected a global growth of 3.5 percent in 2019 and 3.6 percent in 2020, representing a 0.2 and 0.1 percentage point below the 3.7 per cent average growth in 2018.

Meanwhile, a finance expert has said that adequate liquidity and non-export inflows such as Foreign Direct Investments (FDI) and diaspora funds would bring significant growth to the nation’s economy.

Chief Executive Officer, Economic Associates, Ayo Teriba, while giving the keynote address, said unlocking adequate liquidity would restore growth and stability in Nigeria’s economy, end fragility and build resilience. He noted that the global liquidity glut resulting from large liquidity injections by leading central banks still provides opportunities for Nigeria to attract foreign investment inflows to compensate for lost export revenues.

He maintained that to mitigate low revenue and inadequate foreign exchange, the nation must immediately find ways of attracting large non-export foreign exchange inflows, like foreign direct investment and medium-term diaspora funds to make up for lower export incomes. Teriba reiterated that Nigeria must ensure adequate internal and external liquidity to restore growth and stability.

Speaking further, he stated that foreign resource inflows into Nigeria have remained a one-track affair as exports account for the bulk of inflows into the country, while non-export inflows are small and stagnant.