In order to improve the performance of the manufacturing sector in Nigeria, the Manufacturers Association of Nigeria (MAN) through its CEO Confidence Index’s maiden edition said Government must make conscious efforts to address the following challenges which was identified by CEOs of various manufacturing companies in the country: The Manufacturers Association of Nigeria (MAN) have over 2500 CEOs of manufacturing companies as members
- Repair and expand the roads leading to Lagos Ports
- Make other ports outside Lagos functional so as to address the gridlock challenges and the associated cost;
- Make FX more available for purchase of manufacturing inputs that are not locally available/ convergence of the existing FOREX windows
- Expedite the process of issuing manufacturers the End Users Certificate through liaison with the MAN as it is being currently worked out;
- Continue to improve on the power supply and the general upgrade of the nation’s infrastructure;
- Capital Expenditure component of the National budget should be conscientiously implemented to bridge the infrastructure gap;
- Design and implement appropriate incentives for the struggling sectors;
- Oversight function of NASS should be coordinated through the supervising MDAs to obviate the incessant and unwarranted invitation of manufacturers to the National Assembly.
- Proper implementation of government laws and regulations;
- Resolve the issue of back-dating of the reclassification of manufacturers as strategic gas users;
- Ensure improved surveillance of the National borders to reduce the menace of smuggling and importation of goods on the prohibited list sold openly in supermarkets;
- Improve supply of natural gas to manufacturers;
- Create a flexible condition to improve manufacturers’ access to fund
- Ensure compliance of tiers of Government to the regulation on Harmonized taxes so that only the approved ones are implemented;
- Entrench better monetary policy management to reduce the currently high inflation in the economy;
- Ensure that NAFDAC & DPR agree on who inspects base oil used by the Petroleum Products Sub-group.
- Facilitate long term and low interest loan facilities to the real sector, at no more than 5%.
- Ensure conscientious implementation, monitoring and performance evaluation of Executive Orders 003 for improved patronage of locally produced goods by MDAs
- Pay particular attention to the development of railways around the national ports;
“The MCCI First Quarter of 2019 paints the picture of a manufacturing sector that is struggling. The confidence level of the CEOs in the sector, though not negative, is dwindling. The 51.3 points, being the outcome of the first quarter MCCI, will form the basis of gauging performance in subsequent quarters. It is evident that the performances of some sectors and industrial zones fell short of the 50 points benchmark; this informs the need to prioritize the solutions and do the needful to improve the perception and overall performance of the manufacturing sector.
According to the report by MAN, the data presented was generated from the responses of over 200 CEOs of MAN member-companies across the country focusing on their positions on macroeconomic and business operating environments as well as perception on the earlier mentioned diffusion factors. The computation of the Diffusion Indexes involved weighting the percentage “Positive” responses by ‘1’ and “Neutral” responses by ‘0.5’, then summing them up across Diffusion Factors. The MCCI result for the first quarter 2019, standing at 51.3 points, clearly depicts a manufacturing sector that is slightly above the minimum threshold.
The report disclosed that an aggregate or composite MCCI above 50 points signifies that Manufacturing sector is still struggling as operators have seemingly low confidence level but high expectation that manufacturing performance will improve. MCCI of 50 points shows that the sector is stagnant; below 50 points signifies that manufacturers are losing confidence on the economy and that the performance of sub-sectoral groups is retracting.