Manufacturers’ suggestions for economic turnaround

CONCERNED by the economic woes of Nigerians and the apparent helplessness of the federal government, the Manufacturing Association of Nigeria (MAN) last week made a number of suggestions to turn the situation around. The association lamented the impending collapse of more manufacturing companies in the country and called on the federal government to take 10 measures to rescue the manufacturing sector and correct the economy’s lackluster performance. Speaking at the association’s 39th Annual General Meeting in Ibadan, Oyo State, Ahmed noted that the manufacturing sector has been hampered recently by challenges such as the high cost of diesel and other petroleum products, acute shortages and high cost of forex, uncertainty , high cost of raw materials, inconsistent government policies, high regulatory compliance costs, stalemate and inadequate infrastructure in ports, claimed it was important for the government to prioritize the allocation of forex to the manufacturing sector and empower the Central Bank to Nigeria (CBN) to instruct commercial banks to transparently process forex applications by manufacturers.

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Among other things, MAN called on the federal government to abolish the 7.5 percent value added tax (VAT) on diesel pending the normalization of the international supply system. It also asked the government to quickly resolve the complexities of seamlessly implementing the Eligible Customer Initiative so that manufacturers can take advantage of the stranded electricity. Again, it demanded a reduction in port charges and the elimination of demurrage for unnecessarily delayed customs clearance. In addition, it noted the need to improve the time needed to clear containers/cargoes in ports by ensuring that proper trade facilitating equipment such as scanners is available, and by monitoring the implementation of Implementing Decree 003 to ensure compliance by ministries, ministries and agencies (MDAs), and convening a strategic meeting with key players in the Nigerian economic space to deliberate and formulate a national strategic response to the disruptive impact of the ongoing war between Russia and Ukraine on the global supply value chain and its debilitating impact on the Nigerian economy.

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We think many of the suggestions are sensible as they aim to revive production in the country. In light of the disruptions caused by the war between Russia and Ukraine, it makes sense to devise strategies “to reduce the impact of the disruption, agree on ways to alleviate other pain points in the business environment, innovative solutions for known and emerging macroeconomic and infrastructure challenges.” There is really no alternative to deal with the declining production capacity in the country, if carefully assessed and properly implemented, the suggestions have the potential to increase production and production capacity within the economy, and that would be extremely good news for Nigerians who currently have little or no cause for celebration This is especially important because a continuation of the mercenary attitude that has always governed and characterized the course of events in the Nigerian economy can only lead to greater misery for the vast majority of Nigerians who are, as it were, caught up in the setbacks that continue to unfold across the country Significantly, MAN’s recipe for economic turnaround also touches upon the issue of insecurity, an area in which the government consistently paints a picture of surrender. and the ubiquitous uncertainty across the length and breadth of the land resolutely, taking the fight to the bandits rather than waiting for them to strike before launching clearing operations.

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We urge the government to listen to those directly responsible for production within the economy and put their suggestions to work to boost production. An economy characterized by mass production will guarantee jobs and maximize the contribution of Nigerians to national development. It will also guarantee the influx of investment and facilitate the government’s ability to reduce social discontent. As we have said time and again, there is no other path to economic turnaround than manufacturing. The sooner the government addresses this with MAN’s suggestions as a template, the better for the health of the Nigerian economy.

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