The Manufacturers Association of Nigeria (MAN) has called for effective implementation of key government policies and adoption of initiatives that woul tackel some challenges bedeviling the sector.
The Manufacturers observed that manufacturing performance is still below the mark, notwithstanding the marginal improvement in the operating environment during the quarter under review, as the sector is still plagued by numerous familiar constraints.
This assessment came on the heels of careful review of the sectors performance in the fourth quarter of 2021
According to the MAN, the fourth quarter of 2021 highlighted a gradual improvement in the macroeconomic economic and manufacturing operating environment buttressed by marginal recovery of some key manufacturing indicators.
Although, changes in almost all manufacturing indicators as measured in the report are still not as desired, the performance in the fourth quarter is better than what obtained in the preceding quarter.
The resilience of manufacturers, the seasonal transactions and passive policy support sustained manufacturing in the quarter despite the prevalence of familiar and emerging excessive tax related challenges faced by manufacturers.
Overall, the Association said the sector recorded a mixed grilled performance occasioned by meagre improvement in the operating environment indices and macroeconomic ambience evidenced by the high points, which cumulatively triggered the increase in the aggregate MCCI score for the quarter to 55.4 points from 54.0 points recording the preceding quarter.
To solve the challenges the Association appealed to government to further incentivize investment in the development of raw-materials locally through the Backward Integration and Resource based industrialization initiates.
Government should call for more investor to key into these initiatives with appropriate and definite incentives, for instance, there is need for urgent investment and production of Active Pharmaceutical Ingredients (API) in the country; investment and production of machines; iron and steel; petrochemical materials, etc to support manufacturing activities, said MAN.
It also appealed that specific attention should be given to the security of life and investment in industrial areas; properly delineate and upscale security infrastructure in the various industrial areas in the country, particularly in the northern part of the country for priority attention. Government should also quickly invest in modern security such as drones, camera, etc. for robust monitoring of the areas.
In addition, the Association requested for effective allocation of available forex to productive sectors, particularly the manufacturing sector for importation of raw materials and vital machine and equipment that are not available locally.
Government also needs to expressly direct the Central Bank of Nigeria, CBN, to consult with the Ministries of Industry Trade & Investment and effectively engage MAN on measures for improving forex supply to manufacturing concerns.
As part of its demand the Association urged the Ministry of Science Technology and Innovation to inaugurate the Secretariat that will implement the strategies for the Executive Order and SON to designate local manufacturers of LPG Gas Cylinders as priority provider of the 10 million Cooking Gas Cylinders to be procured by the Government for 12 States in the Federation.
Government was also asked to return milk and other Dairy Products to the National List in the Fiscal Policy Guidelines to maintain consistency with the Backward Integration Programme, which has spurred heavy investments in the diary production.
Equally, it sought for the unification of academic curriculum with industrial skill needs and requirements to guarantee sustainable development of skilled manpower for the industries and government should as a matter of urgency synchronize the curricular of tertiary institutions, particularly the Polytechnics with skills requirements of industries. The various government vocational and training centers should also be re-engineered to offer those skills that are needed by the industries.
Also, there is need to revisit the resuscitation of the existing national refineries to produce fuels locally, embark on the rehabilitation of major highway corridors, improve trade facilitation infrastructure and deepen the ongoing development of rails system to change narrative on operating environment from being high cost to low production cost environment while government should ensure that industrial policies in the country are allowed to gestate with proper monitoring and evaluation rather than jettisoning or altering them unduly frequently. The continuous infractions on the original EPZ and tariffs for the Motor Vehicle and Assembly sector should be quickly remedied to the development of the zones and motor vehicle assembly in the country.
Other recommendations include sustaining the Eligible Customer initiative to ensure that more electricity is supplied to the manufacturing sector , strengthening the Bank of Industry (BOI) and Bank of Agriculture (BOA) to adequately provide liberal finance for the manufacturing sector and monitor the implementation of Executive Order 003 to ensure compliance by MDAs so as to boost activities in the manufacturing sector.
Others include publication of the list of approved harmonized taxes and levies for the manufacturing sector by the Joint Tax Board (JTB) to address the issues of multiples taxes and levies; rationalization of Government Ministries, Departments, Agencies, parastatal and Commissions to resolve the issues of over-regulation and duplication and improve the time taken to clear machines and raw-materials at the national ports while making the link road accessible.