Lead Capital Boss urges Government to tap into under-utilized goldmines

The Group Managing Director of Lead Capital Plc, Bimbo Olashore, has urged government to move the country forward by tapping into the under-utilized goldmines in order to increase income for the nation, having noted that the Nigerian economy is well diversified in terms of contribution to GDP, but that the source of government revenue is not diversified.

He said this during his speech on “Revenue Diversification-The Bedrock of Sustainable Economic Development”, at the induction of new professional members into the Association of Investment Advisers and Portfolio Managers, recently held in Lagos.

He advised that to reap the fruit of diversification, Government must get some economic-wide basics right which is not far-fetched from, employing good macro-economic management, running a counter cyclical fiscal policy to contain massive boom-bust cycles, soughting out exchange rate policy, opening trade policies, creating special places for selective credit policy, building other types of capital to complement natural resource wealth, and bringing down the costs of production in the new traded sectors, to spur efficiency and encourage entry.

He canvassed a diversified economy in order to reduce dependency, guarantee economy in order to reduce dependency, guarantee security and peace of mind to the nation. He reiterated that areas such as VAT rate, Tourism Development, Property Rights and Piracy, Company Income, and formalizing the informal sector, should be put into consideration. He continued thus: “Nigeria has some non-revenue areas which include VAT, Custom &Excise, Company Income Tax, amongst others. I believe we can look into the VAT rate which is currently too low, Tourism development, which is lacking but has huge potentials, Property Rights and Piracy which is currently growing rapidly and company income”.

Speaking on the issue of employment and SMEs, he x-rayed that it would be better to get a clearer picture of what we want to do, whether to engage in SMEs to solve employment issues or just to create profit in the sector. To this end, he canvassed that a master industry plan be employed in order to allow other SMEs partake at local level, noting that the bigger a company is, the more responsible it is in paying tax. He urged government to create and expand an environment for middle class, and long term policies.

He took a cursory look at some countries who went into diversification, and now reaping its fruits.  According to him, Malaysia diversified into energy, communication, transport, and free trade; Indonesia diversified into export orientation, strategies and taxation, inspite of the booming oil sector; Chile, emphasized on counter-fiscal high policy, fiscal discipline and savings; Dubai, diversified income stream to attract Foreign Direct Investment (FDI) expatriate law, infrastructure, real property, range of services, establishing free zone to further build export capacity; and lastly South Africa diversified into manufacturing and tourism with a national Industrial Policy Frame work.