VENTURES AFRICA – The Lagos Chamber of Commerce and Industry (LCCI), on Tuesday, has expressed concern on the credit situation in the country; adding that tight credit situation is the major problem inhibiting the capacity of domestic enterprise to take advantage of the robust Nigerian market.
The Chamber in its 2013 first quarter report asserts that lending rates were well above 20 per cent, but many small and medium-scale enterprises still have serious challenge in accessing credit even at the high rate.
The report which was signed by the President, LCCI, Goodie Ibru, stated that “the tight credit situation is a major inhibiting factor to the capacity of domestic enterprises to take advantage of the robust Nigerian market. This position was corroborated by our Business Confidence Survey for the second quarter of this year.”
“The credit challenge was identified as the factor with the biggest negative impact on business confidence.”
According to the chamber, poor access to credit by indigenous entrepreneurs is the leading reason why foreign investors are gradually taking over businesses in the country.
The chamber, however called on both fiscal and monetary authorities to work together to ease the credit condition, especially for small and medium-scale enterprises, and more importantly, domestic businesses.
“This is critical as well to stem the gradual crowding out of domestic entrepreneurs by foreign investors,” it said.
The chamber added that the lingering disagreement between the Director-General, Securities and Exchange Commission, Arumah Oteh and members of the National Assembly will have a huge risk to financial system stability because of the link between the capital market and the rest of the financial sector.
The chamber therefore called on the Upper House to allow the overriding interest of the nation to supersede the desire to get an individual to vacate office, saying, “We should make a distinction between an individual and an institution. The latter is far more important than the former.”
“We reiterate our position that these should be a recourse to the provision of law to bring any erring public officer to justice. There are adequate apparatus of government to make this happen. It is inappropriate and disproportionate to shut down a major regulatory institution in the economy because of the alleged shortcoming of the chief executive.”
Meanwhile, the chamber noted that the security situation in the country has deteriorated in the first quarter of the year. This, it said, has impacted on investment risk and worsened the nation’s perception and image at the global level.
“Access to markets in the troubled parts of the country has reduced for many enterprises, and this is already affecting sales and profitability. Also, many enterprises have re-located with the inherent challenges,” LCCI said.xclusivetalk.blogspot.com
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