Taiwo Hassan 
The Manufacturers Association of Nigeria (MAN) has once again tasked President Muhammadu Buhari to urgently end foreign exchange (forex) and energy crisis in the country before end of his administration. The Director-General, MAN, Segun Ajayi-Kadri, gave the advice in Lagos recently, saying that forex scarcity and energy crisis were the two issues that have hindered the real sector of the economy from getting to the top.
He said that the real sector was having difficulties getting raw materials owing to stifling FX scarcity, while the high cost of diesel (AGO) has also hit its bottom line. According to him, currently, the naira exchanges for N500 to $1 at the Import& Export (I & E) window, while in the parallel market, it has plummeted to N780 to $1 at a period manufacturers need forex to sustain their businesses.
In addition, Ajayi-Kadir explained that the energy crisis was also suffocating the industry, which has continued to get diesel to power its machines at N800 per litre. These two issues have been a bitter experiencee, thus the association is yearning for the intervention of the government to bring succour to the country’s manufacturing sector before its exit next year. While speaking further, the MAN DG said inadequate foreign exchange and energy crisis had hugely challenged the sector, forcing a dip in the sector’s output from 5.8 per cent in the first quarter of 2022 to 3.0 per cent in the second quarter. Ajayi-Kadri said these challenges massively affected manufacturers that are already confronted by an unpleasant operating environment, caused by COVID-19 and the current Russian- Ukrainian war. He noted that manufacturing indicators such as capacity utilisation, contribution to real gross domestic product investment, employment, cost of production, competitiveness among others were also negatively impacted. He added that with the limited foreign exchange in-flow from crude oil sales, foreign exchange demand pushed over the bounds of supply and contributed to the depreciation in naira value.
Segun Ajayi-Kadir stressed that the challenges must be adequately addressed to arrest further degeneration in the performance of the sector. “In doing that, we consider the following measures critical such as the allocation of a significant proportion of available foreign exchange to the productive sector, particularly manufacturing. “Further investment in the electricity value chain must be carried out and the government must commit to adding 10,000 MW to the current electricity distributed in the country. “Also, we must embrace and support significant development of renewable energy mix as the country has huge potentials for solar and wind,” he said. Ajayi-Kadir added that the scope of road infrastructure should be expanded and the tax credit scheme developed and refurbished.
