The Lagos Chamber of Commerce and Industry has projected a high cost of doing business in 2020.
Its Director-General, Dr Muda Yusuf, made the projection in the LCCI 2019 Economic Review and Outlook For 2020 made available to newsmen on Thursday in Lagos.
He attributed the projected high cost to poor infrastructure, the multiplicity of levies, excessive regulations, among others.
Yusuf said while the nation may have recorded improvement on the Ease of Doing Business Ranking due to some recent policy measures, realities on the ground would continue to differ if the highlighted challenges were not properly addressed.
He said the performance of the trade sector in 2020 would be shaped by the direction of government policies.
Yusuf anticipated that the manufacturing sector would continue to benefit from the Central Bank of Nigeria’s aggressive credit push.
He, however, predicted that competition between foreign and local producers would fade on prolonged closure of land borders.
The director-general said headline inflation was expected to trend higher in 2020.
He said this would be driven by the implementation of the new minimum wage and the continued closure of the land border.
Yusuf said a higher Value Added Tax rate of 7.5 per cent and the early disbursement of funds for budget implementation following the return of the budget cycle would also be contributory factors.
“We expect economic growth to remain subdued at around two per cent by 2020 as consumer demand, as well as private sector investment, will most likely remain weak.
“We are of the view that failure by government to fix structural constraints with regards to fixing power challenges and rehabilitating deplorable road networks, will perpetuate the poor productivity and performance of the sector.
“In our opinion, continued protectionist measures of government will most likely limit growth in 2020.
“Elsewhere, the level of the country’s engagement in Africa Continental Free Trade Area scheduled to kick-off July 1, 2020, will also impact the performance of trade sector.
“As a sustainable solution, it is imperative to fix the fundamental issues of high cost of domestic production, the prohibitive cost of cargo clearing at the Lagos ports, prohibitive import tariffs, high cost of logistics within the economy, and border policy capacity,” he said