Adedapo Adesanya
By Adedapo Adesanya
The current energy crisis in the country and the world at large has made the Manufacturers Association of Nigeria (MAN) appeal to the government to support businesses with 2.5 per cent interest rate loans.
Chairman of the Kwara/Kogi branch of the association, Mr Bioku Rahmon, said this would avert imminent retrenchment of workers and mass closure of companies.
He expressed concerns that the manufacturing industry was yet to fully recover from the effects of the COVID-19 pandemic, adding that skyrocketing cost of energy is not what the industry needs at the moment.
Mr Rahmon lamented that electricity generated from the national grid had recorded no improvement and was hampering the activities of MAN.
In a statement, he asked that interest rates on industrial loans be reduced by commercial banks to 2.5 per cent.
“Renewed wave of inflationary pressures further plunged the buying masses into extreme depths of poverty with concomitant erosion of customers’ Disposable Income (DI) and hence culminated in low patronage of our industrial finished products.
“Foreign Exchange (FX) scarcity has worsened significantly, even as industry players continue to experience a sharp and growing shrink in the FX windows. This has led to major downturns and stress in the purchase and acquisition of foreign components for production,” he stated.
The MAN executive noted that the epileptic power supply has long resulted in sharp depletion in the key performance indicators (KPI) of the manufacturing industry such as capacity utilisation, unsold goods inventory, and sector contribution to the National Gross Domestic Product (NGDP), especially since 2020.
Mr Rahmon, also appealed to the government to initiate measures that would address the challenges, noting that last year the unfriendly operating environment and inconsistent business and investment policies of the government further paralysed the manufacturing industry leading to weak results in the sector.
At the state level, the association urged the Kwara State government to rescue manufacturers by installing a gas-powered energy distribution plant that will exclusively supply power to industries while the CBN should give directives to commercial banks to reduce interest rates on industrial loans.
