The Nigeria Employers’ Consultative Association (NECA) on Tuesday advised the Federal Government to tame its appetite for leverage on loans to avoid negative impact on the economy.
Larry Ettah, NECA’ President, gave the advice at the Association’s 61th Annual General Meeting in Lagos.
Ettah said that the cost of servicing Nigeria’s debts on both the domestic and external fronts has risen in contrast to revenue earned by the government.
He said: “The World Bank in its recent Global Economic Prospects Report had noted that the current optimism over Nigeria’s economic recovery is tempered by concerns over huge debt servicing obligations and continuous foreign exchange control.”
The out-going president said that the recently passed 2018 national budget showed that the debt service provision was the third largest component of the expenditure framework.
Ettah said: “In the last three years, the rising cost of debt servicing is in the top three allocations in the national budget.
”In 2015, the budget was N4.493 trillion, 2016, N6.077 trillion and N7.441 trillion in 2017 of which debt service alone took about 23.71 per cent, leaving N13.741 trillion for recurrent and capital expenditure.
“N2.2 trillion cost of debt servicing is about 30.76 per cent of total expected revenue (N7.1 trillion) indicating that debt service may soon be back to the pre-debt relief period.”
On tax, Ettah said the organised Private Sector was making effort to expand its tax to Gross Domestic Product ratio from six to 15 per cent to achieve sustained growth in the economy.
He commended the government for improving the ease of doing business.
He also urged the Federal Inland Revenue Service not to further burden the private sector with more taxes in its drive to meet the N6.7.trillion target for 2018.
Ayuba Wabba, NLC President, in a goodwill message said it was regrettable that some employers have refused to respect labour laws or right of workers in spite of various pleas.
Wabba, who was represented by the NLC’s General Secretary, Dr Peter Ozo-Eson, commended NECA for fostering industrial relations’ harmony.
Bobooi Kaigama, TUC President, also commended NECA for showing empathy with workers and also ensuring that its members meet condition for decent work.
Kaigama said that in spite of the high cost of doing business in Nigeria, employers were still thriving to survive.