By Christian Njoku
The Manufacturers Association of Nigeria (MAN), has asserted that manufacturers were not satisfied with the current naira to dollar exchange rate, but were happy with the stability.
This was disclosed by Dr Adoga Inalegwu, Chairman, MAN, Cross River and Akwa Ibom chapter of the association during an interaction with journalists in Calabar.
Inalegwu who is also the Chief Executive Officer (CEO), Champion Breweries Uyo, said they were not just happy with the stability in the exchange rate but the fact that dollar was also available and they were not struggling to source for Forex.
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The chairman said Pres. Bola Tinubu’s policies though tough were necessary because the nation could not continue living in deception and using palliative measures that never solved a problem.
“Some people have complained about his tax reform but I believe his tax reform has its pros and cons one of which is the shrinking of multiple taxation issues and improving disposable incomes of Nigerians.
“This has reduced the taxation burden for low-income earners and freed up disposable income in the hands of Nigerians, meaning they can buy more which favours my industry and others that produce goods considered to be non essential in classification.
“However, the negative side, of the new tax law is the issue of Value Added Tax (VAT) which was increased by 2.5 per cent; this is huge for manufacturers,” he said.
Speaking further, Inalegwu highlighted power as a major challenge to manufacturers in Nigeria when he said 40 per cent of cost in the manufacturing sector goes to power alone.
He said where there was no stable source of electricity, manufacturing and production becomes not only difficult and challenging but also very expensive
“Few years ago, we were buying diesel for less than 200 Naira to a litre, now, diesel is over N900, we’re talking about over 300 per cent increase.
Gas used to be cheaper; two years ago, I was buying a standard cubic meter of compressed natural gas at about N240, now, I am buying it at more than N600, the same Compressed Natural Gas (CNG).
“Meanwhile, not everybody can go into renewable energy like solar which itself requires huge capital expenditure,” he said.
According to him other challenges include lack of experts to fabricate and repair equipment, as engineers produced by Nigerian universities lack the requisite capacities, so, companies rely on very expensive expatriates.
He called on the Nigerian universities to rejig their curriculum to be in tandem with global practices to make more skilled manpower available.
