[vc_section css=”.vc_custom_1511865449102{margin-right: 0px !important;padding-right: 0px !important;padding-left: 15px !important;}”][vc_row css=”.vc_custom_1510315062002{margin-top: 0px !important;margin-bottom: 30px !important;padding-top: 0px !important;padding-bottom: 0px !important;}”][vc_column css=”.vc_custom_1510315051673{padding-top: 0px !important;padding-bottom: 0px !important;}”][vc_column_text css=”.vc_custom_1511760535562{margin-top: 0px !important;margin-bottom: 0px !important;}”]The Chief Executive Officer and Managing Partner of AOC, a Lagos-based accounting firm, Mr. Adebisi Oderinde, in this interview with ‘FEMI ASU, speaks on the economic crisis plaguing the country and the need for industrialisation.
What are your thoughts on the economic headwinds facing the country at this time?
Many people believe that the economic crisis that we are facing now is based on the bad policies of the government which, basically, with my 22 years in accounting and tax practice, is not so. This is because we have a formidable economic planning. But the problem is the implementation. Who are the people to implement? It is not the President that is going to implement any economic policy. If we get it right in terms of implementation, the country will move forward. Many things have been put in place now by the present administration, although almost everybody is feeling the pain. To me, it is going to be temporary.
What should be done to address the challenge of implementation?
When you see the various policies and programmes of the past governments, some of them have become a source of frustration. Most of the programmes including the one for the unemployed are beautiful programmes. But because of the ways they were implemented, the benefits did not get to a lot of Nigerians. When the new administration came in, the government owed a lot of salaries. Sincerely, what the Federal Government did was not what it should have done – releasing N700bn as a bailout for states. After giving out the bailout, many of them did not pay salaries. Now, the states are coming back, asking for more bailouts.
We will need to shift more focus away from the public sector to the private sector. The government has been making efforts to improve on agriculture, make money available to the Small and Medium Enterprises and so on, but it has not done enough. If the government focuses on making the SMEs to grow, it will help the country. The states want to increase their Internally Generated Revenues; it is not the IGR that really matters. If you provide the enabling environment for businesses to thrive in the country, your IGR will increase. You want to increase your revenue through tax from a company that has not seen any increase in turnover or profit within the last 12 months; it means unemployment will continue to increase. We need to move our economy away from over-dependence on oil and gas. We have to empower the youths through agriculture and small-scale industries.
Secondly, most of the things that are in the hands of the government need to be privatised. If you look at the Lekki-Epe road concession, as of today, I don’t see any road that is as well-constructed as the Lekkk-Osborne Bridge, apart from those in Abuja. It was built through the private sector. The government should give incentives to the SMEs to grow and make new ones to come up. We have a small factory in Arepo, Ogun State, and we are into bottled water and children’s drinks. By the special grace of God, we are expanding the factory. This is because Governor Ibikunle Amosun of Ogun State has provided the enabling environment for any business to thrive in the state. When you have a good road network, your trucks will drive safely down to your factory. Very soon, Ogun State will be an industrial hub in Nigeria.
What other major investment options are you considering?
As it is now, we are coming up with a company called Priscilla Capital Ventures, and that company is bringing about four foreign companies into Nigeria. We have Sopac Packaging Solutions from South Korea, Propac Korea Company Limited, Inotech, Turkey and HPM Global Corporation, Korea, coming to team up with us. By the time we finish the project, I can assure you that the company will engage nothing less than 2,000 workers. By the time the products come out, part of the multiplier effect is that it will give employment to so many people.
There is no other solution to this economic problem than for Nigeria to be industrialised; for Nigeria to move away from over-dependence on oil and gas. When you look at other countries that have mineral resources such as India, Mexico, Japan and China, you will see that what they did was to move away from that oil and then industrialise their countries. By so doing, whether crude oil price is going up or down, it doesn’t really affect them. When I was in South Korea recently, I could see that the place is highly industrialized; by doing that, they create more employment.
You have been in accounting practice for over two decades now, what do you think about the contribution of the profession to the Nigerian economy over the years?
When you look at accountants in any sector, they always add value because money or finance is like the heart of a business. We have, in one way or the other, helped government policies. When you look at any state in which an accountant is the governor, you will see that the state is doing well. The Institute of Chartered Accountant of Nigeria has been doing very well. One thing is for you to advise the government, it is another thing for the advice to be utilised.
I would like to beg the government not to increase the Value Added Tax to 10 per cent for now. Now, people are suffering and complaining that there is no money to spend. If the government increases VAT, automatically, it will increase the cost of products. What the government needs to do is to bring more people into the tax net.
This is a period that I can even say we need to reduce our tax rate. Fuel price is N145 per litre and minimum wage is N18,000. It is true that Nigeria’s VAT is among the lowest in West Africa. The only aspect I disagree with the government is when it is saying Ghana’s VAT rate is about 15 per cent or this other country has 18 per cent VAT rate. Do we have the same infrastructure that those countries have? You can’t compare the state of electricity in Ghana with what we have here. You cannot just increase VAT to about 10 per cent without empowering your citizens.
The way the Federal Inland Revenue Service is doing its job, trying to bring many people into the tax net and to ensure that we pay our taxes as and when due, is excellent. That was what was done in Lagos State. I don’t support increase in any tax rate at this present economic situation in Nigeria. There are so many people who are not paying tax in this country and they are doing wonderfully well. So, bringing those ones into the tax net is the best solution for this present administration to achieve its N4.5tn tax revenue target for this year.
What should the government put in place for more businesses to sprout up in the country?
Although the government has tried through the Bank of Industry by putting in place different facilities, how many people are getting the loans? Is the money put in place enough? If the government can provide enough funding for manufacturing, it will help the country. Now, most of the textile mills are gone. If these companies can be revived through the special intervention, it will go a long way in helping the economy. Then the government needs to reduce the cost of governance. It is too high. Let them make politics less attractive. Everybody is running after government appointment because they believe it is very juicy. We have to tackle the high rate of unemployment in the country.
Culled from the punch newspaper
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