Follow Us on Google
By Merit Ibe, [email protected]
The Manufacturers Association of Nigeria (MAN) has expressed deep concerns over the increasingly stringent regulatory environment in Lagos and across the country, highlighting the heavy financial burdens these regulations impose on manufacturers. The association is advocating for significant improvements in infrastructure within industrial areas, emphasizing the need to bolster domestic industries, enhance their competitiveness, and ensure that the manufacturing sector thrives.
At the 57th Annual General Meeting (AGM) of the Ikeja branch, themed “Improving Productivity in Nigeria’s Manufacturing Sector: Monetary/Fiscal Policy, Infrastructure, and Competitiveness,” industry leaders voiced their frustrations and charted a course for the future. Robert Ugbaja, Chairman of MAN’s Ikeja branch, underscored the relevance of the AGM’s theme as the manufacturing community grapples with the complexities of a challenging business environment. He acknowledged the critical role of the manufacturing sector as a barometer of economic health but lamented that the harsh operating conditions are severely undermining productivity and competitiveness.
Ugbaja pointed out that while the manufacturing sector’s contribution to the real Gross Domestic Product (GDP) has been significant, driven by various initiatives, persistent challenges such as inflation, regulatory complexities, and unemployment continue to plague the sector. He detailed the myriad of obstacles manufacturers face, including the high cost of raw materials, insecurity, inadequate skilled labor, exorbitant transportation costs, frequent policy changes, exchange rate instability, high interest rates on loans, poor infrastructure, and overregulation.
Despite these challenges, Ugbaja noted that the association has made considerable strides in advocating for a more favorable business environment. He praised the Governor of Lagos State, Babajide Sanwo-Olu, for his cooperation and efforts to create a more enabling environment for manufacturers in the state.
MAN President, Francise Meshioye, echoed these sentiments, noting that the theme of the AGM was timely given the current challenges and opportunities within Nigeria’s manufacturing sector. Meshioye emphasized the importance of focusing on business sustainability and enhancing productivity through sound fiscal policies, robust infrastructure, and strategies that boost global competitiveness as Nigeria navigates a period of significant economic reforms.
Meshioye also extended appreciation to Governor Sanwo-Olu for past collaborations and urged the governor to further improve infrastructure in industrial areas, harmonize taxes—particularly local government and road-related levies—and take additional steps to simplify compliance for MAN members. He reassured members that the association would continue to prioritize issues affecting their businesses, striving to ensure that the government provides the necessary enabling environment for their substantial investments.
“We recognise the significant setbacks the manufacturing sector has faced in recent times,” Meshioye remarked, “due to challenges such as the high cost of diesel and other petroleum products, acute shortages and the high cost of foreign exchange, widespread insecurity, the rising cost of raw materials, exorbitant regulatory compliance costs, and the recent hike in electricity tariffs. Nevertheless, we remain committed to engaging with government ministries, departments, and agencies (MDAs) to advocate for policies that will positively impact the real sector’s performance.”
In his report, Femi Gbadegun, Executive Secretary of MAN’s Ikeja branch, highlighted the constrained operating environment caused by the global economic slowdown and domestic policy uncertainties. He noted that the sluggish GDP growth rate, hovering around 2.5 percent, coupled with consistently high inflation rates above 15 percent, has severely impacted purchasing power and increased production costs. Gbadegun pointed out that while Lagos State continues to attract a significant portion of the nation’s industrial activities, its economic potential is hampered by infrastructural deficits, regulatory bottlenecks, and inconsistent government policies.
“Economic uncertainties, including fluctuating foreign exchange rates and inconsistent power supply, compound these challenges,” Gbadegun said. “Additionally, the lack of clarity in regulatory requirements and frequent changes in laws create an ambiguous operating environment, making it difficult for manufacturers to plan and execute their strategies effectively.”
Speakers at the event emphasized the need for operators to continuously remodel their business operations, adopting a culture of collaboration that aligns with the current realities. They identified several key drivers for growing Nigeria’s manufacturing sector, including creating a synergy between monetary and fiscal policies, involving stakeholders in the policy formulation process before the release of new regulations, and improving infrastructure in industrial areas.
Representing Governor Babajide Sanwo-Olu, Oluwagbemiga, the Permanent Secretary of the Ministry of Commerce, Trade, and Investment, reiterated the state’s commitment to boosting its economic potential. He highlighted ongoing efforts to create jobs and increase the state’s GDP through policies that support the manufacturing sector. The governor assured MAN members that his administration would continue to domesticate policies tailored to the needs of manufacturers, ensuring a more conducive business environment.
