Manufacturers Query Pricing of Gas for Local Consumption in Dollars

June 26, 2023
Francis Meshioye manufacturers association of nigeria

By Dipo Olowookere

The President of the Manufacturers Association of Nigeria (MAN), Mr Francis Meshioye, has questioned the rationale behind the pricing of gas generated for electricity in the country in Dollars rather than in Naira, the nation’s legal tender.

Mr Meshioye, who was a guest on Arise TV’s flagship programme, The Morning Show, which was monitored by Business Post on Monday, said it was absurd for Nigeria to compel its citizens and business owners to purchase gas in a foreign currency, stressing that this is affecting his members and hurting the country’s economy.

The MAN leader was reacting to the planned hike in electricity tariff from July 1, 2023, by the country’s energy distribution companies (DisCos) by about 40 per cent.

He argued that this price increase would affect manufacturers in the country as they would pass the cost on to the consumers, who are already grumbling due to the hardship brought upon them by the removal of fuel subsidy by the government of President Bola Tinubu.

“The gas is paid in Dollars, and manufacturers have asked why can’t we pay in Naira because we consume it (gas) here, and our currency is the Naira.

“So, if our currency is Naira, and we are going to price in Naira, why do we have to pay for gas that we generated and have in Nigeria in a foreign currency?” he queried.

Speaking further, he said, “The exchange rate of Dollar is not stable, it has been galloping upward for many years, and this makes manufacturers’ businesses unpredictable; you cannot predict your cost and what will happen. You run a multi-flexible budget every time, and we have complained about this.”

He suggested that to make things easier for all; the government should “make the gas pipelines available [to manufacturers] all over the country so we have access to it.”

“[The government must also] stop making manufacturers pay [for gas] in Dollars and make it possible to pay in Naira, which is the national currency,” he added.

Dipo Olowookere

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan.

Mr Olowookere can be reached via [email protected]

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