FG To Support Local Manufacturers With N75bn

Nigeria’s Vice President Kashim Shettima has said the federal government will support local manufacturers with N75 billion by March 2024 to strengthen the manufacturing sector. Shettima said this while declaring open the second National Conference on non-oil export organised by the Nigerian Export Promotion Council (NEPC) in Abuja. Represented by Dr Jumoke Oduwole, Special Adviser on Presidential Enabling Business Environment Council (PEBEC) and Investment, Shettima said N75 billion was earmarked to support 100,000 start-ups and Micro Small and Medium Enterprises (MSMEs) at single digit interest rates. The two-day conference is with the theme, “Building a Sustainable National Economy Through Non-Oil Export.” According to him, the federal government is also committed to providing necessary infrastructure that will support increased export of non-oil commodities. “There can never be a better time to envision a conference of this nature than now; a time to reflect on non-oil export. “Over the years, the nation’s major source had been 80 per cent dependent on oil revenue. “It is clear that as a nation, we can’t afford to work on this uncharted path. “Today, we find ourselves in protracted situation and challenges. All indications point to the fact that we have to prioritise our non-oil export. “And this administration will give every support to boost non-oil export,” he said. While pledging support towards made-in-Nigeria products, he assured of federal government’s commitment to provide infrastructure that would facilitate export trade. “We will prioritise capacity building for MSMEs, we will invest in human capital development. “We need to work diligently to utilise opportunity provided by African Continental Free Trade Area (AfCFTA) by deepening our existing values and expanding our forex earnings,” he said. Earlier, the Minister of Industry, Trade and Investment, Dr Doris Uzoka-Anite, expressed concern that Nigeria operated a mono-economy for long. The minister, however, expressed joy that government’s diversification efforts were beginning to yield positive results. “Nigerian non-oil exports grew by almost 40 per cent in 2022, reaching 4.820 billion dollars. “Semi-processed and manufactured products accounted for almost 37 per cent of these exports, surpassing agriculture’s 30 per cent. “This is a big step in the right direction. We no longer have the luxury of business as usual when it comes to the business of making sure Nigeria succeeds. “We can no longer afford to export raw materials cheaply and import finished products at premium prices. “That train has stopped and will not be starting again. Our focus for exports is locally manufactured value-added products that create both business and employment,” she said. Dr Ezra Yakusak, the Chief Executive Officer of NEPC, said the Council had significantly increased the contribution of the non-oil sector to the Nigerian economy. According to him, for first time, the performance of the non-oil export grew by 39.91 per cent in 2022 to 4.820 billion with about 214 different products exported, ranging from manufactured, semi-processed, solid minerals to raw agricultural products. He said Nigerian products were exported to 122 countries, and appealed to the federal government to address the strange disease afflicting ginger farm in Kaduna State. “I will not do justice to this address if I do not present the challenges being faced by farmers and exporters of ginger in Nigeria. “It is a known fact that Nigeria’s ginger has been adjudged as the best in the world due its unique aroma, pungency and high oleorosin content. “This makes Nigeria one of the largest exporters of ginger in the world.  However, the Council received several complaints of the outbreak of a strange disease ravaging ginger farms in Kaduna State. “So far, about 2,503.9 hectares of farmland have been affected with an estimated loss of over N8 billion,” he said.

MAN lists high energy costs as major challenge

The Manufacturers Association of Nigeria (MAN) CEOs Confidence Index (MCI) for the second quarter of 2023 has revealed that rising energy costs remain a major challenge facing manufacturers in the country. Challenges facing manufacturers according to the survey includes, energy costs; high cost of credit/inadequacy of loanable funds; multiple taxes/charges/levies/same tax policy for local producers and importers; unavailability of raw materials/delay in receiving imported raw materials; high cost of raw materials and scarcity of forex/high exchange rate/poor allocation of forex. According to the survey, about 63.1 per cent of manufacturers enumerated disagreed that government capital expenditure encourages productivity in the manufacturing sector; 23.9 per cent of those enumerated agreed, while about 13.1 per cent were unsure. MAN said the aggregate index score of MCCI in the second quarter of 2023 declined by 1.4 points to 52.7 points from 54.1 points obtained in the first quarter of 2023, which is also 2.3 points less than 55.0 points recorded in the fourth quarter of 2022. According to the survey findings, manufacturers within the country continue to grapple with the reverberations of the Naira Redesign policy, which was implemented during the tenure of Godwin Emefiele, the former Governor of the Central Bank of Nigeria (CBN).  Furthermore, manufacturers lament the hindrance caused by two concurrent factors, among which is the upswing in motor vehicle insurance expenses, which continues to add to the operational burden of manufacturers. Additionally, the escalation in logistics costs is a concern that stems from the heightened pricing of premium motor spirit (PMS), commonly referred to as petrol. This is of particular significance as manufacturers need to distribute their goods extensively across the various states of the country, entailing substantial transportation expenses. The survey’s observations underscore that the second quarter of 2023 witnessed a substantial uptick of 17.3 per cent in both production and distribution costs for manufacturers. This surge in costs further accentuates the challenges faced by the manufacturing sector and calls for a comprehensive examination of strategies to mitigate these adverse effects. Director General of MAN, Segun Ajayi-Kadir, in the report said government’s capital expenditure should address the issues of economic infrastructure such as roads, electricity, water, etc. that support industrial sector businesses. “The absence of economic infrastructure contributes significantly to the high cost of operating environment which obstructs the development of manufacturing in Nigeria. “It is highly expedient that the government strives to ensure the harmonisation of fiscal and monetary policies that will pave the way for a stable macroeconomic environment needed to promote productivity in the manufacturing sector and improve the ease of doing business,” he said.

Bear the temporary pains, have faith in us, Tinubu tells Nigerians

*Promises to review civil servants salaries *Says he’ll acquire 3000 CNG-fuelled buses for mass transit *To fund 75 manufacturers companies with N75bn President Bola Tinubu has acknowledged the challenges that Nigerians are facing due to the economic policies implemented by his government. However, he called upon them to have faith in the government’s ability to turn things around. Speaking via a nationwide broadcast on Monday night, Tinubu assured the citizens that he has devised palliative measures to alleviate the impact of removing fuel subsidies. He said that while he recognizes the immediate difficulties caused by the subsidy removal, Nigerians must focus on the bigger picture and the positive plans that are currently in progress. Tinubu admitted that there was a gap between the removal of subsidies and the implementation of these plans but assures the public that the government is actively working to close this gap. According to him, his genuine concern for the well-being of the people is evident in his appeal for their trust in the government’s capacity to deliver. Among the initiatives, Tinubu pledged to acquire 3000 Compressed Natural Gas (CNG)-fuelled buses for mass transit across the states and local governments. This move aims to make public transportation more accessible and affordable. To fund this project, the government has allocated N100 billion, earmarked for investment between now and March 2024. The CNG buses will be shared with major transportation companies, and these companies will have access to credit at 9% per annum with a 60-month repayment period. In addition to public transport improvements, Tinubu said he is actively collaborating with Labour unions to introduce a new national minimum wage for workers. He assured workers that their salary review is on the horizon, and once an agreement is reached, budget provisions will be made for immediate implementation. The President further commended private employers in the Organised Private Sector who have already taken the step to implement salary reviews for their employees. Furthermore, Tinubu said he aims to boost the manufacturing sector by allocating N75 billion between July 2023 and March 2024. The funds will support a minimum of 75 enterprises with great potential to stimulate sustainable economic growth, structural transformation, and improved productivity. Each of these manufacturing enterprises will have access to N1 billion credits at a maximum of nine per cent per annum for long-term loans and 12 months for working capital. The President emphasized that these actions align with the executive orders he signed earlier in the month, which aimed to address friendly fiscal policies and multiple taxes that have been stifling the business environment. By suspending and deferring certain taxes, the government aims to create a conducive environment for businesses to flourish and expand. In conclusion, President Bola Tinubu’s message to Nigerians is one of hope and perseverance. Despite the temporary pains caused by economic adjustments, he implored the nation to look ahead and trust in the government’s commitment to improving the overall welfare of its citizens. The plans to improve public transport, review civil servants’ salaries, and support the manufacturing sector demonstrate the government’s determination to create a brighter future for Nigeria. Full text of President Tinubu’s address to Nigerians My fellow citizens, I want to talk to you about our economy. It is important that you understand the reasons for the policy measures I have taken to combat the serious economic challenges this nation has long faced. I am not going to talk in difficult terms by dwelling on economic jargon and concepts. I will speak in plain, clear language so that you know where I stand. More importantly, so that you see and hopefully will share my vision regarding the journey to a better, more productive economy for our beloved country. For several years, I have consistently maintained the position that the fuel subsidy had to go. This once beneficial measure had outlived its usefulness. The subsidy cost us trillions of Naira yearly. Such a vast sum of money would have been better spent on public transportation, healthcare, schools, housing and even national security. Instead, it was being funnelled into the deep pockets and lavish bank accounts of a select group of individuals. This group had amassed so much wealth and power that they became a serious threat to the fairness of our economy and the integrity of our democratic governance.  To be blunt, Nigeria could never become the society it was intended to be as long as such small, powerful yet unelected groups hold enormous influence over our political economy and the institutions that govern it. The whims of the few should never hold dominant sway over the hopes and aspirations of the many. If we are to be a democracy, the people and not the power of money must be sovereign. The preceding administration saw this looming danger as well. Indeed, it made no provision in the 2023 Appropriations for subsidy after June this year. Removal of this once helpful device that had transformed into a millstone around the country’s neck had become inevitable. Also, the multiple exchange rate system that had been established became nothing but a highway of currency speculation. It diverted money that should have been used to create jobs, build factories and businesses for millions of people. Our national wealth was doled on favourable terms to a handful of people who have been made filthy rich simply by moving money from one hand to another. This too was extremely unfair. It also compounded the threat that the illicit and mass accumulation of money posed to the future of our democratic system and its economy. I had promised to reform the economy for the long-term good by fighting the major imbalances that had plagued our economy. Ending the subsidy and the preferential exchange rate system were key to this fight. This fight is to define the fate and future of our nation. Much is in the balance. Thus, the defects in our economy immensely profited a tiny elite, the elite of the elite you might call