FG Can Earn N1000bn From ‘Negligible Telecom Surcharge’- Emefiele

FG Can Earn N1000bn From ‘Negligible Telecom Surcharge’- Emefiele

Godwin Emefiele, Governor of the Central Bank of Nigeria (CBN) on Friday night insisted that the country was in an economic condition called ‘stagflation’ rather than recession recession as being reported.
In his keynote speech at the 2016 annual dinner of the Chartered Institute of Bankers of Nigeria (CIBN), he defined ‘stagflation’ as a situation where a nation’s GDP records negative growth in two consecutive quarters, while inflation and unemployment continue to rise.
The CBN Governor there suggested the introduction of a negligible telecom surcharge to be entirely borne by the initiator of a call that could yield up to N100 billion yearly for the federal treasury.
This is one of several ways to raise additional revenue to finance the increased expenditure needed to engender fast and sustainable economic growth.
But “to protect the poor and vulnerable amongst us, we could structure it to only take effect after the third minute of talk.
“Obviously this surcharge will mainly be borne by middle and upper class people since I do not know many poor people who make calls for more than three minutes,” he added.
He equally proffered long-term solutions to the nation’s economic challenges, including huge investments in agriculture and basic infrastructure like roads, bridges, airports, railways, and information technology for immediate job creation.
“We could also consider introducing minimal property taxes across the country. This not only raises money for the government but also could be a veritable weapon against corruption since it creates a database of who really owns homes in this country.
Emefiele also urged the Federal Government to consider the fully implementation of the 2003 Cabotage Act, which “stipulates that all cargoes and passengers in the inland and coastal waters be transported by ships and ferries built, owned, crewed and manned by Nigerians.”
At the moment, he said there are several foreign-owned vessels providing shipping services locally and that of about 600 ships operating within the nation’s waters, of which just 10 per cent are owned by Nigerians. But even these are mostly idle, in violation of the Act, he added.
Industry sources, the governor continued, agree that “Nigeria may be losing as much as N2 trillion annually from this anomaly.
“In addition to raising revenue, a full implementation of the Act could also spur job creation, capacity building, and significant backward integration.”
Emefiele also urged government pursue non-oil exports from Nigeria can benefit significantly by tapping into the market for certain goods, which are in high demand.
“For example, the demand for Halal meat and sesame across the Gulf Cooperation Council (GCC) Countries is huge.
“In fact, we have credible information that the Saudis may need up to 120,000 heads of frozen goat/sheep per week from Nigeria.
“Similarly, the demand for cashew nuts and shea-nut butter across the world is rising. Nigeria has comparative advantage in all these products and can quickly tap into the vacuum created from the sharp fall in supply of these products from their erstwhile major suppliers.
“From these, we can earn foreign exchange to bolster our Reserves while also creating jobs and engendering broad based economic growth,” while calling for import-reducing policies.
This, he continued, “is in view of the fact that oil prices would remain low for a long period, it is clear to us that FX revenue inflows will remain low, with relatively low FX Reserves, for a while.”
Consequently, he believes it is time to take bold and decisive actions at fundamentally changing the structure of our economy, because “Monetary Policy alone cannot achieve this but it must do its part.”
Nigeria, he continued, can make the best use of a bad situation  by “looking inwards and stopped supporting the importation of items that we can produce locally using Nigeria’s hard earned Foreign Exchange.
“This implies that importers who may want to bring in such goods or services will have to source their Foreign Exchange outside banks or BDCs.  It is important to remind everyone that the exchange rate is simply a price that is determined by the forces of demand and supply.
“Having adjusted the currency in response to supply shortfalls, we believe that it is critical to ensure that the demand side bears some burden of the adjustment. 27.In this regard, I must hasten to add that while they may seem controversial, variants of this policy have proven to be highly effective in other climes and even here in Nigeria,” Emefiele added.