The Lagos Chamber of Commerce and Industry (LCCI), has said recent report that the Federal Government would import 100 rice mills from China for distribution to states which is the outcome of collaboration between the Federal Ministry of Agriculture, NEXIM Bank and the Central Bank of Nigeria, raises a number of concerns.
According to LCCI, the decision by the Federal Government to import rice mills into the country is a negation of the current policy thrust in economic management canvassed by the members of the economic team that government would concentrate on the provision of enabling environment to support the growth of private enterprises.
President of the Chambers, Mr. Goodie Ibru, in a statement on Tuesday, said such acquisitions should be done by the private sector with the support of government, and that this fundamental principle is also Vision 20 2020 document as an economic management philosophy that would guide the choice and direction of economic policy.
Explaining that the decision to import rice mills is a negation of this principle, the LCCI president said that the story of the Nigeria National Petroleum Corporation (NNPC), the petroleum refineries, NITEL, steel complexes, fertiliser plants, petrochemical plants, Nigeria Airways, the railways, paper mills amongst others illustrate the tragedy of state owned enterprises in Nigeria.
He lamented that these enterprises were managed by politicians and bureaucrats and that the cost to the economy was horrendous, adding also that similar scenarios played out in many states.
According to Ibru, this is not a model of government intervention that the economy deserves as had been proven by empirical evidence, adding such policies have not worked in most economies as it is typically marred by mismanagement and corruption.
He added that direct government intervention is desirable in infrastructures, security, environment, public schools and hospitals as well as other areas in which there are evident cases of market failure, while saying the proposed acquisition of rice mills raises a number of specific concerns such as how will the rice mills be distributed?, wow will they be managed?, and how will they operate alongside the existing rice processing mills owned by small scale operators without creating the challenge of unfair competition?
Copyright Ships & Ports Ltd. Permission to use quotations from this article is granted subject to appropriate credit given to www.shipsandports.com.ng as the source.