…1.3bn market penetration disrupted
The Director-General, Manufacturers Association of Nigeria (MAN), Mr. Segun Ajayi-Kadir, has said that manufacturers in Nigeria spent more than N72 billion for alternative sources of power in 2021 as a result of outages and epileptic supply.
In an interview with New Telegraph on Monday, he stated that the financial commitment retarded the profit efficiency, employment, and wealth generation as well as the competitiveness of the industrialists.
He lamented that uncompetitiveness with other challenges retarded the propensity of the manufacturers to penetrate the 1.3 billion continental market across 54 countries in Africa under the African Continental Free Trade Area (AfCFTA). The African Continental Free Trade Area (AfCFTA) is a free trade area founded in 2018, with trade commencing on 1 January 2021.
Ajayi-Kadir said: “I do know that we spend more than N72 billion on alternative energy or providing power for ourselves in the past year. “N72bn spent by manufacturers as a result of outages affected their profit, efficiency, employment and wealth generation propensity, more importantly, competitiveness.
All of these were affected negatively, especially because we were at the threshold of commencement of active trading under the African Continental Free Trade Area, AFCFTA.
“This uncompetitiveness that is occasioned by these challenges and others have reduced our chances of penetrating the 1.3 billion continental market or people in Africa that this agreement would have allowed us to penetrate with our product. Our being non-competitive jeopardises the chances of our members in this free trade area.”
The MAN DG urged the Federal Government to boost the competitiveness of manufacturers in Nigeria by upscaling power generation and distribution. He also appealed to the government to improve efficiency in the ports, adding that the gridlock at the ports inhibits exportation and importation.
He also said the intervention by the Central Bank of Nigeria (CBN) in foreign exchange management had not yielded the desired result as, according to him, manufacturers still have not been able to access the required quantity of forex.
He, in addition, revealed that the reintroduction of excise duties and an increase in the existing excise of some products in Nigeria had adversely affected manufacturing in the country.
He raised the alarm that there would be an increase in prices of goods and services when the reviewed policy is implemented from June.
According to him, the reintroduction of the policy is ill-advised and came at the wrong time. He also identified the alleged multiplicity of taxes and levies by different levels of government as another impediment.
Ajayi-Kadir said: “The gridlock at the ports makes import and export an herculean task, which is not good for our export. It is not also good for our productivity because it takes, for instance, virtually the same amount to import a 40-foot container from Singapore to Apapa than to take it from Apapa to Agbara, which is just 27km away. So this is seriously impacting businesses. “There is the mention of power, and foreign exchange.