BudgIT, on Tuesday in Abuja urged states in the country to strengthen areas of revenue generation and collaborate on exploiting their economic potentials.
Chief Executive Officer, BudgIT, Mr Gabriel Okeowo, gave the advice at the presentation of the organisation’s 2021 report on “State of States”.
He said the states should diversify their economies by promoting agriculture, tourism and solid minerals.
Okeowo further recommended that states should focus more on capital rather than recurrent expenditure.
“We advise states to build structures that will outlive whatever current government each state have.
“Beyond internally generated revenue that is mostly driven by taxes, we want to see states go into production and avenues that create jobs for people.
“When we have jobs for people GDP is increased and it is easy for livelihood and tax consumption to also increase, we can have more revenue and fiscal conditions from there,” he said.
Okeowo explained that focus should be on how the economy would bounce back after recent shocks caused by COVID-19.
“This year’s edition of the State of States is focused on how the sub nationals can rejuvenate their economies after the shock from Covid-19,” he said.
According to him, states should go into collaboration, as each has one mineral or natural resources to utilise.
“We have recommendations for each state, if the states can implement some of these recommendations and work together, their IGR will increase.
“States needs to mutually come together to grow, some states go out saying they are sustainable which they are not, every state in Nigeria needs to look inward.
“Lagos and Kebbi came together and did the lake rice, Lagos had the market and Kebbi had the land space for cultivation. We would love to see such collaboration among other states,” he said.
Okeowo explained that states that were ranked top five in the report based on their capital investments, and ability to meet their operating expenses and loan obiligations with their revenues.
He listed the states as Rivers, Ebonyi, Anambra, Lagos and Kebbi.
Mr Laoye Jaiyeola, Chief Executive Officer, Nigeria Economic Summit Group, who is the keynote speaker, said that the productive driver of the economy was at the sub national level.
According to him, most states are surviving on the massive loans they obtained from the Federal Government.
He advised states to take advantage of the resources in their areas in order to develop. “North West and North Central have expanse of land area and accounts for 90 per cent of crop production.
“The South South with access to oil and gas accounts for 91.5 per cent of oil production.
“South west, the point of Lagos accounts for 60 per cent of trade and investment.
“The serene South East has coal deposit and an industrial technology as well as an entrepreneurial skill. There is no region in this country that is not well endowed.
“States that sustain their growth process will continue to get richer while those that are outside the growth process will remain poor,” he said.
Jaiyeola noted that states focus more on income shared than income generation, and paid no significance to derivation.
“We are not seeing efforts to increase what the states have.
“Looking at the impact of COVID-19 on the nation, many states now rely on the Federal Government, and it is not sustainable, because the debt level is high and the financing of debt is worrisome,” he said.
He advised against increase in tax rate, saying instead, there should be tax efficiency by expanding the tax base.
“They should look at the property tax, modify the Land Use Act, make it efficient and use geographic information. They should also explore the financial market and interstate collaboration.
“States like Rivers can look into palm oil production, Edo and Lagos can collaborate and work on furniture production, this will improve Nigeria,” he said.
