Rebound in oil prices not foreseeable – NECA

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Nigerian Employers Consultative Association of Nigeria (NECA) has warned that the price of oil is not expected to rebound in the foreseeable future.

NECA therefore called on the government to direct more effort in looking beyond oil to address the nation’s economic challenges.

The association said the government required about $3 billion monthly to function, but its receivable is about $1 billion per month, reflecting a drop of $2 billion.

‎NECA President, Larry Ettah, said gone were the days the price of oil was $100 dollar per barrel in the international market.

He said: “The oil price will not go up to $100 per barrel as we used to enjoy. Gone are the days when we used to buy it for $80, $90 or $100 per barrel. We have to be living in a restructured environment in which case we have to be looking into how to diversify the economy. And I think this is a painful opportunity for us which we have to take.”

Ettah said for the country to exit the recession, the government should work on the power  sector, saying it needed to generate between 15,000 megawatts and 20,000 megawatts (mw) for it to have stable economy.

“It is a shameful thing that while South Africa is talking of 40,000Mw, we are still celebrating 3,000Mw. The minimum we should be generating is between 15,000Mw and 20,000Mw. What it means is that there will be a lot of spending on power generation,” Etta said.

He pointed out that another area the government needed to address was policy formulation. Ettah said though the economy was in a mess when the administration came in, it had grown worse because of wrong policy.

“For instance, if we are talking of deregulating, the foreign exchange (forex) market, imagine if we have done this one year ago, the foreign capital inflow would have  fared better,” adding that we should not forget that the problem of the Niger Delta, which has also affected our production, is there,” he added.