MAN warns 32% interest rate, energy costs threaten manufacturing sector 

Manufacturers Association of Nigeria (MAN) has warned that a 32 per cent interest rate and energy costs are seriously threatening the manufacturing sector in Nigeria.
 
The association lamented that no manufacturer could survive in the country under the present high energy costs and lending rates of 32 to 36 per cent.
 
MAN President, Ifeanyi Okoye, stated this yesterday in Port Harcourt, Rivers State, at the 42nd Annual General Meeting, Conference and Exhibition of the Rivers/Bayelsa Branch.
 
Speaking on the theme, ‘Manufacturing for National Development: Integrating Education, Skills, Investment and Tax Incentive’, he described education as the foundation of industrial growth, while skills, as the bridge, converts education to productivity.
 
He described investment as the fuel of manufacturing, stating that investment could not survive in darkness.
 
“With electricity at N285, maybe up to N230 per kilowatt-hour, diesel at about N2,000 per litre, and lending at about 32 to 36 per cent, no manufacturer can, of course, exist,” he said.
 
The MAN president recounted his experience at the Nigerian Economic Summit Group (NESG) meeting in Abuja and in Paris, where the Managing Director of the Bank of Industry (BOI) claimed that interest rates for manufacturers had been dropping for about one year.
 
“I was shocked. I stood up as a discussant and told him, I cannot agree with you. For the past one year, interest rates have been going up irrespective of bank recapitalisation,” he said.
 
Okoye also faulted the disparity between financing available to Nigerian manufacturers and foreign investors, noting that Chinese investors access funds at as low as three per cent interest while Nigerian manufacturers are offered nine per cent by BOI, only for purchase of machines under strict monitoring.
 
“Give me three per cent interest. Forget the type of industry I will build. Can any bank in Nigeria give you 10 per cent interest?” he queried.
 
On tax incentives, he said tax must reward those that create jobs, export and use local raw materials.
 
He commended the Rivers State Governor, Siminalayi Fubara, for improving ease of doing business through the establishment of the Investment Promotion Agency and reduction of harassment in Trans Amadi and Eleme, as well as maintaining peace and keeping Trans-Amadi and Onne industrial areas functional.
 
He also commended Bayelsa State Governor, Douye Diri, for improving ease of doing business through an open-door policy via the Ministry of Trade, Industry and Investment, and for efforts to resolve power challenges, including the installation of a 600-megawatt gas generator in Yenagoa.
 
However, he expressed disappointment over the absence of any commissioner from Rivers and Bayelsa States at the AGM.
 
Earlier, while commending the outgoing leadership of the Rivers/Bayelsa Branch for improving the institutional image and acquiring a bus, he charged the incoming Chairman, Nosakhare Agana, to keep the flag flying and surpass the achievements of his predecessor, Vincent Okuku.
 
On his part, Okuku called governments of the two states to sustain dialogue with MAN to address the challenges manufacturers face.