Stable oil prices won’t resolve Nigeria’s economic challenges’

By  Benjamin Alade

 An investment expert and Chief Executive of EFG Hermes Nigeria Limited, Lilian Olubi, has said that

rising oil prices would help Nigeria to achieve economic stability. She, however, said a stable oil market alone would not resolve the country’s economic problems.
 
In an interview with The Guardian, Olubi said the economy earnestly needs fiscal adjustments that would enable the government to spend more in stimulating the economy. 
 
“We also need to see more liberal policies from the government and easing of import controls in order to boost business activity,” she said.
   
Speaking on dwindling foreign exchange rates, she said the short-term solution is for authorities to push for a clearing rate that would liberalize the market. 

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She said: “This can be done with a loan package either from the International Monetary Fund (IMF) or the World Bank that would boost reserves and help authorities to regulate the market. Having a clearing-market rate would encourage inflows into the country, thereby boosting FX supply.”
 
Speaking on a bill passed by the government’s move to take possession of unclaimed dividends, she said there were already ongoing initiatives to manage the unclaimed dividend issue, hence the before the National Assembly came as a surprise.
 
According to her, unclaimed dividends are incomes of private investments, which should be managed by the companies who understand the history of shareholder claims. She said the funds should be used by the companies to boost their long-term capital needs.
 
Another option, she said is to look at a mutually beneficial opportunity, which could be managed like the Nigeria Sovereign Investment Authority (NSIA) with a strong governing board, well-defined support causes and a transparent retrieval system.
 
She said different industries have been affected in varying degrees by COVID-19, both positively and negatively. But what remains key-learning for all businesses, she noted, is that services should be upgraded to meet its customers’ changing needs. She also called on businesses to diversify their product offerings while upscaling their human capital resources to deliver on new offerings.