The Lagos Chamber of Commerce and Industry ,LCCI, and the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture ,NACCIMA, has lamented the recent petroleum pump price increase, saying it would further lead to economic instability.
The organisations therefore called on President Bola Tinubu immediately reverse the increase.
LCCI for instance stated that the removal of petrol subsidy in a manner that caused a sharp hike in the pump price would present significant challenges to Nigerians and businesses.
Director General of LCCI, Dr. Chinyere Almona, in a statement said the current petrol subsidy was unsustainable and the burden of the shortfall had accumulated to a debt of N10 trillion.
Almona said “Completely removing it and subjecting Nigerians to a significant fuel price hike presents significant challenges.
“A steep price hike would likely trigger widespread price increases, potentially reversing the recent easing in inflation seen in July and leading to another surge in inflation rates. Balancing the need for fiscal responsibility with the economic impact on citizens is a complex task for the government.”
LCCI added that the impact of the latest hike in petrol price on businesses “will be severe, with fuel prices affecting supply and logistics, power generation, transportation, and factory operations.
“The cost of doing business will skyrocket, prices of goods will rise, and some firms may shut down due to low demand in the face of weakening consumer purchasing power. Of course, this will be followed by job losses.”
The chamber stated that even though the “situation is critical, when considered against the background of NNPC, which owes suppliers about $6 billion, the operation of the Dangote Refinery, which now produces fuel and diesel for sale, offers a glimmer of hope.
“This game-changing intervention could restore some stability to the oil and gas sector, which has been grappling with significant distortions this year.”
It advocated, “Supporting the development of additional local refineries to process our crude for local consumption and potential export across Africa is the way forward.
“This long-term strategy is crucial for the stability and growth of our economy.
“As an immediate intervention, it would be beneficial for the Port Harcourt Refinery to commence operations alongside production from the Dangote Refinery.
“Given the current challenges with importing refined fuel, relying on local production may be the most viable option at this time.
“We recommend sustaining local supplies, with the expectation that demand will eventually align with supply, leading to equilibrium pricing across various sources.”
NACCIMA, in a statement by its National President, Dele Oye, called on the federal government to engage in constructive dialogue with relevant stakeholders, including the organised private sector and labour unions, to address the concerns raised about the price increase and its potential effect on the economy.
The statement said, “NACCIMA expresses concerns over the recent increase in the pump price of petrol to over N800 per litre at NNPC filling stations across the country.
“While we understand the complex factors that can influence fuel prices, such as global oil market dynamics and exchange rate fluctuations, we are troubled by the lack of prior notice and clear explanations provided by the government and the NNPC regarding this development.
“The timing of this price hike is particularly concerning, as it has the potential to further exacerbate the impact on businesses and consumers, especially the vulnerable segments of the population and those on fixed incomes, who are still adjusting to the recent increase in the national minimum wage.”
Oye stated, “We are particularly interested in understanding the reported conditions that may have been agreed upon during the minimum wage negotiations, and how the current development aligns with those understandings. Maintaining trust and credibility in the government’s economic policies is crucial for fostering a conducive business environment and promoting inclusive growth.
“Furthermore, we urge the authorities to provide clarity on the NNPC’s financial reporting, which has seen conflicting statements about the company’s profitability and financial obligations. Transparency and accountability within the state-owned oil company are essential for building public confidence.”
He added, “NACCIMA remains committed to working collaboratively with the government and other stakeholders to find sustainable solutions that balance the needs of businesses, consumers, and the broader Nigerian economy. We believe that open dialogue and a shared commitment to the nation’s prosperity are key to navigating these complex challenges.”
