*Demands bailout to save sector collapse.
*Urges FG intervention over closure of coys, soaring diesel price
By Emma Okereh and Chidinma Ihegazie (Abuja)
The Manufacturers Association of Nigeria (MAN) has urged the federal and state governments to rescue industries from the current epileptic power supply and hike in price of diesel across the country.
The chairman Kwara/Kogi states branch Pharm Bioku Rahmon said there was the need to urgently rescue players and investors from the imminent orgy of unemployment and mass closure of Companies currently looming.
A statement issued by Rahmon on Monday, said while the manufacturing industry was yet to fully recover from the monumental strangulations it suffered from the COVID-19 pandemic, the ongoing energy crisis is the exact antithesis of what the industry can’t contain at this time.
It explained that the National Grid-Supplied Electricity has recorded no improvement which is greatly affecting activities of MAN.
The Association called on the state and federal government to bail it out and saved the manufacturing sector which contributes a great chunk of percentage from total and immune college which would unless a major catastrophe to the already bad economy. It therefore asked that interest rates on industrial loans be reduced by commercial banks, widen the window of Foreign Exchange (FX) to industries and a drastic reduction of interest rates as done with the covid-19 era palliatives to 2.5 percent.
According to the statement, “Renewed wave of Inflationary pressures further plunged the buying masses into extreme depths of poverty with concomitant erosion of customers’ Disposable Income (DI) and hence culminated in low patronage of our industrial finished products.
“Foreign Exchange (FX) Scarcity has worsened significantly, even as Industry players continue to experience a sharp and growing shrink in the FX windows. This has led to major downturns and stress in the purchase and acquisition of foreign components for production.
The above have long resulted to sharp depletion in the Key Performance Indicators (KPI) of the Manufacturing Industry such as capacity utilization, unsold goods inventory, and sector contribution to National Gross Domestic Product (NGDP) especially since 2020.
” In 2021, the unfriendly operating environment and inconsistent business and investment policies of government further paralyzed the manufacturing Industry leading to weak results in the sector, all of which were further exacerbated by the COVID-19 pandemic”
Rahmon, therefore appealed to the government to evolve measures that will address the challenges.
“We appeal to the Federal Government of Nigeria and the Kwara State Government to rise to our urgent rescue to cushion the effect of this Crisis on Industries. We therefore recommend the following as vital matters and measures of utmost necessity and urgency:
“A Gas-Powered Energy Distribution Plant exclusively supplying power to Industries should be installed in a State like Kwara State.
“The Central Bank of Nigeria (CBN) should give directives to Commercial Banks to reduce interest rates on Industrial Loans.
“The Central Bank of Nigeria (CBN) should further widen the window of Foreign Exchange (FX) to Industries.
A significant and drastic reduction of the Interest rates charged on Industrial Loans and other Loans released as COVID-19 interventions or palliatives to 2.5% will be apt, because the challenges arising from the ongoing energy crisis are far more biting than during the COVID-19 period.
The Bank of Industry (BOI) should approve and urgently roll out further reductions in the Bank’s lending rates to Industries.
“An Executive Task-Force should urgently be constituted with the mandate and power of State machinery to deploy aggressive measures of manhunt against saboteurs in the Oil and Gas Industry and halt the spate of indiscriminate hiking of A.G.O. (Diesel) price and mindless extortion of end-users of the product. Others already constituted and mandated should be so empowered for action” it said.
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