MAN, seeks friendly monetary policy from government to prevent total collapse of industries.

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The CBN hasn’t done much in this area

The manufacturing and steel industry are facing lots of problems, regarding accessibility to foreign exchange to buy raw materials and spare parts.


Sir Afam Mallinson Ukatu, Managing Director of NISPO who delivered his speech Presented At The Commerce And Industry Correspondents Association Of Nigeria (CICAN) End of Year Workshop /Media Awards noted that these two important things are what keep manufacturing going or manufacturing working. According to him, if you are not able to have access to forex, in order to buy those items, you are collapsing the factory.

“The CBN hasn’t done much in this area. MAN has been advocating that the CBN should create a window that can help genuine manufacturers access forex with ease but to no avail.


The Commerce and Industry Correspondents Association of Nigeria (CICAN) End of Year Workshop /Media Awards on Thursday 16th December, 2021, With The Theme: Impact of Forex Crisis on the Real Sector and MSMEs



The Managing Director of NISPO and also a member of Organized Private Sector (OPS) stated that We are appealing to the government to make an investment friendly monetary policy to prevent the total collapse of industries. It is becoming so obvious that it has affected so much industries, basically because of the high exchange rates of which some have to go out of the way to buy from the parallel market to continue in production, he added.


“Moreover, If you have a loan running with the commercial banks, and Bank of Industry (BoI) for example, there is no way you will allow your factory to shutdown, because you must service the loan facility, so you have to find a way or the other to get your spare parts and raw materials. But when you are not getting forex from CBN windows, definitely, you have increased your cost of production by 25% – 30%. So, if it is a business that has a small margin, all your projections you have done for the year would be gone, he stressed.


“We are still pleading and asking government to do something to help finance raw materials and spare parts.


“Furthermore, we have been advocating for a means of unification of gas prices, in terms of paying in local currency, or pegging it at a fixed rate because it is meant to be for manufacturers. Anytime manufacturers are getting gas at a fixed rate of ₦400 per Dollar for instance, we can plan with it, but as at today, the devaluation of Naira and with dollar continuously going up, the rate of gas has increased and the Manufacturers are at the receiving end.


“Therefore, there is need to have a system whereby we pay for gas consumption in Naira at fixed price and not by conversion to CBN official exchange rates.


“But if the government can give it as a rebate to the manufacturers, it will be a welcome decision. The truth about this is that not all the gas concessioners are getting it at the same rate. Some are getting it cheaper based on the arrangement they have made over time.


“We the manufacturers are trying to see how we can get a cheaper source of gas and a cheaper means of production.


Ukatu urged CBN and government to find out how genuine manufacturers are paying for gas and to compare it to what other people are paying. There is the need to have a level playing field; otherwise Nigerian manufacturers would be worse off, he suggests.


“How about the issue of variation in taxes and multiple taxes? I have been fighting the issue of double taxation, but yet to yield the required result.


“Unfortunately, the government failed to understand that the size of factor does not determine the size of tax you pay.


“The government agencies and revenue generators will see the size of the factory that is about to close down, and slam it with the amount of tax that you cannot afford.



“The government should understand that these manufacturers have done the investment by themselves, build the road themselves, generate power themselves, yet the government wants us to pay all forms of taxes.



MAN, Member said we have had a lot of issues, including that of revalidation of our C of O, which we were asked to pay a very high percentage of what we had paid for over years on a titled document that have been certified long ago. According to him, I ask do we still have to pay for what we have paid for in the past 10 years. It is not done anywhere in the world. This is policy that is taking people out of business, he stressed.


“We have pleaded that it is not viable. This is bad, for a government that have been in office for 8 years to have issued Certificate of Occupancy (CofO), and another one comes into the office and start requesting for revalidation, asking for the amount you could not even pay when you were acquiring that property.


“The policy is frustrating. Abuja and couple of other places did their validation at little or no cost. We are begging the government of the western states to reconsider such policies.


On the African Continental Free Trade Area (AfCFTA), Managing Director of NISPO said this will be an eye opener to MAN, NACCIMA and other members of the Organised Private Sector (OPS) to see what other countries are doing and come up with blue print to be our facilitators to the government to work in line with what is obtainable in other competitive markets we are into now.


“If our businesses will remain, we have to revisit our policies; we need to understand what is going on in South Africa, the support they are giving to manufacturers.


Competition is good when there is a level playing ground, if this is not done, that means manufacturing may be a thing of the past in Nigeria, he said.


“We are praying that now that there is open door policy to export and to buy where you can, so we have to do some other things that others are doing in their own country to support manufacturing to be able to compete in AfCFTA.

“It is not about going to South Africa for trade fair, looking for investors.


Ukatu reiterated that Investors will come if there is a fair whether ground to do the business that must be free of insecurity, there must be good roads to ply, there must be friendly gas prices and if all these are put in place, then we are ready for business, because the cost of labour in Nigeria is cheaper than other countries.


He concluded by commend CICAN for this laudable occasion; it would not have come in a better time than this. The theme is apt, and we have to continue to advocate for proper policy implementation that will enhance manufacturing positively, he added.

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