Address Constraints to Manufacturing Sector’s Growth, MAN Tells FG

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Dike Onwuamaeze
The Manufacturers Association of Nigeria (MAN) has warned that many of its members could close shop by January 2021, unless the federal government takes urgent steps to address challenges militating against the growth of the manufacturing sector.

The call was made by the President of MAN, Mr. Mansur Ahmed, at the weekend, when he spoke on the, “Effects of the COVID-19 on the Country’s Manufacturing Sector,” at the 2020 Workshop of the Commerce and Industry Correspondents Association of Nigeria (CICAN).

The president, who was represented at the occasion by the Acting Director General of MAN, Mr. Ambrose Oruche, also appreciated the Central Bank of Nigeria’s (CBN) N1 trillion intervention funds for the real sector.
Ahmed said: “I want to put on record our appreciation to the CBN for its interventions. But how far could those interventions go? Many that have been able to access the N1 trillion could not buy machines for their production because of foreign exchange scarcity and you know that most of our manufacturing depends on imported raw materials, spare parts and machinaries.

“We are appealing to the CBN to prioritise allocation of foreign exchange as it did in 2016 and 2017 recession. Then, the CBN prioritised forex to the manufacturing sector and that created growth as production came back to life.
“Why not do the same now by prioritising the allocation of foreign exchange to the manufacturing sector to be able to import needed raw materials and machineries.”

He also said the government has neglected the manufacturing sector by denying it the infrastructure require to be competitive.
“I am saying that many of the manufacturing firms will not open their shops in January unless something drastic is done by the government to alleviate the severe challenges hindering the manufacturing sector.

“There is need for intentional actions from the government to create an enabling environment that will enable investors to set up plants in Nigeria to manufacture industrial raw materials in a commercial quantity that can compete with the rest of the world,” Ahmed said.

He said the impact of COVID-19 was real and telling on the manufacturing sector especially during the lockdown as most countries stopped shipping raw materials to Nigeria.
So, “it will be difficult for some manufacturers to comeback after the Christmas holiday. Why? The raw materials are being exhausted and the foreign exchange to replenish them and purchase spare parts and machineries are not available due to low inflow of foreign exchange into the economy.

“Most of the sub-sectors in the manufacturing sector are operating at less than 10 per cent capacity utilisation because of the lockdown. The steel sector as we speaking now is operating at less than 10 per cent because COVID-19 came with its own challenge of social distancing with the implication that the production floors have to be reviewed. It means that many of our members have to invest in Artificial Intelligence to be able to produce if they have to adhere to the social distancing put in place by the Nigeria Centre for Disease Control,” he said.
The association also demanded for incentives from the government that would encourage local production of raw material as Nigeria is endowed with abundance human and natural resources.