Standard Chartered advises firms on budget

Standard Chartered Bank Nigeria has held a customer engagement forum for its select clients to provide insight on aspects of the budget and its impact on companies in the country.

The lender, in a statement on Wednesday, said the development followed the signing of the 2017 budget proposal by Acting President Yemi Osinbajo. The session was facilitated by the Lead Partner, Tax and Regulatory Services, Deloitte West Africa, Mr. Yomi Olugbenro. He spoke on the topic, ‘The Nigeria budget & fiscal focus 2017: Overview of budget, Economic Recovery and Growth Plan and national tax policy’ In his presentation, Olugbenro noted that N7.44tn in the 2017 budget represented an increase of 23 per cent over that of the previous year in naira terms. He explained that the dearth of infrastructure and other micro-economic indicators had increasingly made it challenging for companies to thrive compared to counterparts in similar economies. Olugbenro, who also spoke on taxation, the ease of doing business, interest rate, foreign exchange market, government borrowing and lending rates, advised business owners to seek the right information as it relates to their respective business. He noted that having a clear understanding of policies and systems within the local economy would enhance ease of transactions. He said, “The budget is an integral part of the Economic Recovery and Growth Plan. While there’s noticeable alignment between the federal government budget and the ERGP, full implementation of capital project is critical to achieving desired developments and recovery. “The current level of revenues remain low and unable to galvanise desired developments, sustained effort is therefore required to raise non-oil tax revenue as borrowing comes with attendant costs. He added, “Debt to GDP ratio appears decent in principle, but low level of revenues means about one-third of revenue is spent on debt servicing. That is a major concern, especially with our history of waste and application of borrowings. We must also curtail the level of recurrent expenditure currently at 70 per cent and steadily raise capital expenditure to a minimum of 50 per cent of aggregate expenditure.”

According to Olugbenro, the 2017 budget is a catalyst for economic recovery and it is expected to stimulate the economy, build infrastructure and deliver growth. He said allocations to works, power and housing as well as transport showed serious intention to develop infrastructure.

The Head, Retail Banking, Standard Chartered Bank, Ebehijie Momoh, said the primary objective of the forum was to add value to clients of the Bank. He said, “The signing of the Nigeria 2017 budget was a significant milestone for many businesses owners and industries as it marked what many perceive to be a green light for accelerated economic growth in the country. “This forum was organised to ensure our clients have a better understanding of the impact of the budget on their businesses and how the bank can provide support to enable them achieve their aspirations. We are, in our little way, making sure that our clients have the best support required to navigate through the second half of the year as we believe the economy is being positioned to improve significantly.”