The Centre for the Promotion of Private Enterprise (CPPE) has expressed concerns over the growing regulatory burden on investors in Nigeria, warning that it threatens the country’s economic growth and development.
Muda Yusuf, CPPE’s director, in a statement on Sunday, accused regulatory agencies of inflicting “irritations, distractions, and frustrations” on the manufacturing sector and other investors, causing them to suffer from “overbearing regulatory dispositions, disproportionate sanctions, obstructionist actions, outrageous fines and penalties, intimidation and high handedness”.
The CPPE’s warning comes as surviving and large companies declare huge losses as seen in their latest quarterly financial results.
Yusuf expressed concern that the regulatory agencies are not exercising discretion in their powers, resulting in multiple regulatory fees and levies, duplications and overlapping responsibilities, regulatory repression, and weak stakeholder engagement.
The CPPE boss appealed to the regulatory agencies to support the government’s aspiration to create an enabling environment for investment, noting that their primary responsibilities are to protect consumers, ensure competition, promote standards and quality, and protect the environment.
However, Yusuf warned that public pronouncements by some regulatory agencies had unintended consequences of demarketing local brands, which is detrimental to the country’s aspiration to boost domestic production, grow investment, expand exports, earn foreign exchange, and create jobs.
The CPPE director highlighted the challenging operating environment in Nigeria, citing exchange rate depreciation, currency volatility, high energy costs, high electricity tariffs, high costs of logistics, weak purchasing power, soaring inflation, high costs of funds, high costs of cargo clearing, and insecurity in parts of the country.
Yusuf emphasised that businesses are already grappling with enormous challenges and urged regulatory agencies not to add to their troubles, believing that regulatory agencies can discharge their functions effectively without jeopardising investment sustainability and growth.
“It is important that the regulatory agencies know that running a business in Nigeria currently is a herculean task. We believe that regulatory agencies can see investors as partners in the Nigerian project and not as objects from which to extract financial value of all types,” Yusuf said.
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