TheCable

Pat Utomi, a professor of political economy and former presidential candidate, says regulatory risk is the biggest challenge to any business operating in Nigeria.

Utomi made this claim on Tuesday while speaking at the Regulatory Conversations 4.0 themed ‘Foreign Exchange Restrictions on Food Imports and Implications for Regulating and Growing the Nigerian Economy’.

Utomi said many companies had collapsed in Nigeria due to regulatory risk and lack of national strategy.

“We should have a clear national strategy that we want to become global leaders in this one, two, three areas,” he said.

“We can do isolated industrial policy to those areas of which our endowments allow us to become competitive globally and dominate that value chain.

“The biggest risk in doing business in Nigeria is a regulatory risk. The regulator is more likely to kill a company than any market risk.”

Utomi said certain sectors of the economy had been wiped out by an unthinking regulator’s actions

He said the government needs to think through the consequences of its policies before implementation, noting that restrictions would not take the country anywhere.

Utomi explained that players in the industry should educate each other on the consequences because the economy belonged to everyone.

“Part of our duty as players in this, is to say to ourselves, look this economy belongs to all of us; can we begin to educate ourselves on the consequences,” he said.

In his comments, Muda Yusuf, the director-general of Lagos Chamber of Commerce and Industry (LCCI), said that the regulatory environment is one of the biggest challenges being faced currently in business in the country.

Yusuf said that regulators meant well for the country but the problem was in strategy and how to achieve it.

“Unfortunately, we don’t have regulators who are in government, who actually listens or engages so that you can have the right kind of strategy to achieve the desired result,” he said.

“There are too many regulations in the country and the damage it is doing to the economy is enormous.

“To do business with integrity in Nigeria today is a tall order.”

He said that many businesses had gone under because of challenges of regulatory compliance adding that many have transited to become informal sector players.

The LCCI boss said that smugglers had taken over businesses in Nigeria, adding that the country was losing because smugglers don’t pay taxes.

He explained that the emphasis should be on building domestic capacity for the development of the country.