Analysis of the MCCI’s composite of 50 points from second quarter report shows that the sector is stagnant and below 50 points signifies that manufacturers are losing confidence in the economy and the performance of the sector is retracting.
According to the Second Quarter 2019 Manufacturers CEOs Confidence Index (MCCI) survey was conducted by the Manufacturers Association of Nigeria (MAN) report which showed the a fore-mentioned performances show that the industrial zones that recorded points below the 50 points thresholds urgently require special support from Government (including their respective state Governments). This support when provided would address observed challenges, especially those that are peculiar to these zones, guarantee the survival and improved performance of the firm.
“Conversely, six sub-sectors weakened below the minimum benchmark for good performance in the following order: Ikeja (49.4 points); Apapa recorded (47.1 points); Edo/Delta (45.2 points); Imo/Abia (42.5 points), Rivers/Bayelsa and Abuja both recorded 33.5 points apiece in the second quarter of 2019.
“Three other sub-sectors recorded below 50 points in the following order: Wood & Wood Products (48.0); Non-Metallic Mineral Products (47.5) and Basic Metal, Iron & amp; Steel, Fabricated Metal recorded 46.5 points in the second quarter of 2019.
“It is therefore pertinent to note that, even though majority of the sub-sector recorded fairly improved level of performance, there is still need for Government to initiate robust support measures that will not only stimulate better performance in all the sub-sectors but save those with performances below the 50-point threshold from imminent collapse.
“The report highlights top on the list of sub-sectors that at the moment require urgent attentions are the Basic Metal and Non-Metallic. Average Production level for the next 3 months Employment Condition for the next 3 months Current Employment Condition (Rate of employment) Business Condition for the next 3 months Current Business Conditions
The report also showed across industrial zones presented similar picture of mixed performance as seven industrial zones in the following order recorded above average performances: Kano strengthened to 63.6 points in the second quarter of the year; Kwara/Kogi increased to 62 points; Oyo/Ondo/Osun/Ekiti (58.9 points); Kaduna (58.7 points); Bauchi/Benue/Plateau (58 points); Ogun (55.6 points) and Enugu/Anambra recorded 53.6 points in the second quarter of 2019.
Further analysis of sectoral responses shows that seven (7) manufacturing sub-sectors performed slightly above the 50-point threshold of good performance in the following descending order:
Domestic/Industrial Plastics, Rubber & amp; Foam (54.5); Motor Vehicle & amp; Miscellaneous.
Others are Assembly (54.5); Food, Beverage and Tobacco (53.5); Pulp, Paper & Paper Products Printing,
Publishing & amp; Packaging (52.0); both Textile, Wearing Apparel, Carpet, Leather and Leather
Footwear and Chemical & Pharmaceuticals recorded 51 points; while Electrical & Electronics stood at 50.5 points.
“The Second quarter of 2019 MCCI with a composite index of 50.9 points presented a weaker manufacturers’ confidence on the economy when compared with the first quarter performance of 51.3 points; thus, indicating a shrinking manufacturing activity. The current MCCI revealed that more sub-sectors and industrial zones performed below the 50-point threshold as against what obtained in the first quarter. This therefore demands that Government should, as a matter of urgency, address the challenges responsible for the observed downward trend.
The Caption Photo: The President, Manufacturers Association of Nigeria (MAN), Engr Ahmed Mansur