The Lagos Chamber of Commerce and Industry has advised the Federal Government to devise means of boosting local production in order to fix the lingering supply chain crisis that ensued in the wake of the Russia-Ukraine war.
The President of the chamber, Asiwaju Michael Olawale-Cole, stated this during his address at the LCCI quarterly state of the economy press conference held in Lagos.
Olawale-Cole said the war between Russia and Ukraine had unexpectedly lingered since February till date, fuelling deeper fears about worsening food scarcity and rising poverty. He added that supply chain disruptions might continue for the rest of the year.
According to him, the war paints a gloomier outlook for the global economy and especially Nigeria for obvious reasons. The most sustainable solution, he said, was for the government to boost local production of hitherto imported staples to levels that would meet local demand.
He said, “In preparing for the reality of our near future, we urge the Federal Government to take seriously the completion of projects like the Trans-Saharan Gas Pipeline, a planned natural gas pipeline from Nigeria to Algeria. With this, we can explore the opportunity of exporting gas to Europe in the long term.
“We should also target Trans-Saharan and European markets with the ongoing construction of the Ajaokuta, Kaduna, and Kano Gas Pipeline, popularly known as the AKK Gas Pipeline. Arising from the calamities of this war, Nigeria can explore emerging opportunities to earn huge foreign exchange inflow in the medium to long-term.
“We reiterate our recommendation that refining our crude remains the most sustainable option especially when we consider the huge cost of subsidies on government finances. In refurbishing the refineries, the government should consider the joint venture model similar to the Nigeria Liquified Natural Gas model.”
On Nigeria’s trade balance which stood at a surplus of N1.2trn, the chamber advised the Federal Government to invest more in export infrastructure, enhanced and automated port operations, tackling high production costs, and boosting the supply-side of the forex market to improve liquidity and ease access to forex.
“We need to also diversify our exports by boosting our local refining capacity, production of petrochemical products, and accelerating reforms in the Oil & Gas sector to attract more foreign investments in the coming months,” the LCCI president said.