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Bimbola Oyesola
The Manufacturers Association of Nigeria (MAN), has blamed high electricity price majorly for the poor performance of the sector in the first quarter of 2019. The Association in reference to the latest report of National Bureau of Statistics (NBS), said the performance of the Manufacturing Sector standing at 0.81 per cent for Q1 2019, fell by 2.59 percentage point when compared with 3.4 per cent of Q1 2018 and by 1.54 percentage points when compared with 2.35per cent of Q4 2018.
“The performance of the sector in the first quarter of 2019 was largely predicted by the Manufacturers CEOs Confidence Index (MCCI) report of the Association which showed the picture of a sector with dwindling performance”, MAN said. It noted that the CEOs of manufacturing concerns expressed an uninspiring confidence on the economy (51.3 points which is slightly above the minimum benchmark performance of 50 points). It further stated that by this report, government needs to pay more attention to the challenges hindering optimum utilisation of the capacity in the sector and the economy at large.
According to MAN, the challenge of inadequate electricity supply persisted and was made worse by the steadily high electricity price.
It added, “Inadequate electricity supply remains a major driver of the cost of production, as it constitutes between 30 per cent to 40per cent of the cost of production. “This is not manufacturing friendly and does not support competitiveness as in addition to other challenges hindering production efficiency in the sector ranging from overregulation, multiple taxation, dilapidated port infrastructure and low purchasing power of the citizenry due to high inflation amongst others.”
