Illicit financial transactions, bane of Nigeria’s economy – Abuja Chamber of Commerce

Illicit financial transactions are the bane of Nigeria’s economy, the President of the Abuja Chamber of Commerce and Industry (ACCI), Mr. Emeka Obegolu, said in Abuja on Thursday.

He told the News Agency of Nigeria (NAN) that illicit financial transactions had also been putting pressure on the naira, leading to its undervaluation and concomitant national challenge.

Obegolu urged the Federal Government to curb illicit financial flows by combating corruption within the financial system quickly.

“The core issue lies in illicit naira transactions for the dollar. The government must tackle this illicit practice head-on.

“I am convinced that the naira is undervalued, with its true value estimated to be between 800 and 1,000 naira to the dollar.

“The undue strain on the naira is predominantly fueled by corrupt practices rather than by legitimate business activities. Thus, addressing corruption is paramount,’’ Obegolu told NAN.

Speaking on the soaring prices of food items, the ACCI president said the government needed to implement measures to boost citizens’ purchasing power.

He also advised that the government should avoid imposing arbitrary taxes and high exchange rates on imported goods.

According to him, importers inflate prices because of the high costs associated with clearing their goods at the ports.

Obegolu emphasised that governance should not solely prioritise revenue generation but should also focus on ensuring citizens’ welfare.

While recommending that the government shift its approach, he advocated for support to be extended to local businesses.

He said this would enhance competition and encourage local production of goods currently being imported at comparable rates.

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“There is no valid reason for a shoe imported from China to be cheaper than the one produced in Aba, Abia. However, the pricing disparity persists today.

“It indicates that the Chinese have harnessed technology to reduce production costs. Therefore, the Nigerian government needs to invest in technology to bolster local enterprises.

“As a local entrepreneur importing machinery from China for shoe production, one should be able to obtain dollars at government rates.

“In instances where entrepreneurs are unable to secure the dollar at the official rate, they resort to the foreign exchange market.

“If there are unfavourable changes in exchange rates before their goods arrive, they encounter challenges,’’ he explained.

According to him, this can result in additional borrowings to clear goods and navigate various checkpoints, ultimately diminishing the entrepreneur’s competitiveness.

The ACCI president also advocated for the government’s removal of fuel subsidies and called for an end to what he called baseless accusations against banks’ chief executive officers.

He charged the Economic and Financial Crimes Commission to present concrete evidence on how banks’ chief executive officers hoarded dollars while declaring profits.

Obegolu also urged the government to eradicate all avenues of financial malpractice and penalise offenders identified by relevant authorities.

“Speculations can unjustly damage reputations by implicating both innocent and guilty parties alike.

“Therefore, reliance on factual information is crucial. We must ascertain how these activities are conducted and hold wrongdoers accountable,’’ Obegolu stressed. (NAN)

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