The Manufacturers Association of Nigeria (MAN), the umbrella body of all local manufacturers in Nigeria, has disclosed that insecurity in the country is severely affecting the prompt movement of their goods nationwide. MAN noted that this problem had made many of its members to be having challenges in increasing their revenue profiles, producing more goods and servicing debt repayment.
The association said that the country’s transportation and storage sector were adversely impacted by insecurity, thereby recording the most severe contraction of 21.89 per cent, principally driven by double-digit contraction in road transport sub-sector (-23.75 per cent) and aviation (-11.73 per cent) in the first quarter of the year.
MAN, in its in-house Newsletter for July 2021, pointed out that local manufacturers were yet to overcome the profound challenges of COVID-19, adding that currently, insecurity had worsened their businesses in the area of movement, with the country’s transport and aviation sectors being impacted severely in the process. According to the newsletter, the transport sector of the economy plays a critical role in the country’s manufacturing sector, especially the road sub-sector, in the movement of people, goods and services nationwide.
It stated that the worsening insecurity on Nigerian roads was alarming and worrisome, saying that some of its members’ goods loaded in trucks were being attacked and goods carted away by hoodlums, causing huge losses. Also, the insecurity has forced many local manufacturers to be producing at an average capacity since they cannot have easy access to raw materials for production. MAN said: “We attribute the underwhelming performance of the road transport sub-sector to the multidimensional impact of insecurity on movement of people, goods and services and that of aviation sector, to difficulties experienced by industry players in sourcing foreign exchange and fewer international travels due to lockdown restrictions in some parts of Europe and Asia.”
Moreover, it would be recalled that the Group Managing Director of Chemstar Paints Industry Nigeria Limited, manufacturer of Fine-coat Paints and Shield Paints, Mr. Adedayo Paseda, bemoaned the heightened insecurity level in the country, saying it had caused the company a huge loss. According to him, the company has, since last year, at the peak of COVID-19 outbreak and lockdown, as well as the heightened insecurity in the country, been operating below capacity of between 50 and 60 per cent of its production and output capacity. “Our operations cover the entire country, but there are several states and areas across the federation where we could not send our staff or vehicles with our products because of insecurity. There are places that our vehicles can no longer go even in the South-West to deliver our products,” he said.
Paseda, who lamented the huge losses, the global health challenge and lack of security in the face of incessant kidnapping and killing by bandits and Boko Haram insurgents, noted: “We have recorded losses in terms of man-hour and output, even when the COVID-19 lockdown was relaxed, our output was less than 50 per cent of what it usually be. “At least 30 per cent less throughout last year, except at the end of the years when it rose between 50 and 70 per cent of what we used to record before the outbreak of COVID-19 and high level of insecurity.”