Manufacturing key to Tinubu’s $1trn economy — Onafowokan

….Says Nigeria must create millions of jobs

Managing director of Coleman Technical Industries Limited, George Onafowokan, has declared that manufacturing remains the “missing link” in Nigeria’s quest to achieve President Bola Tinubu’s ambitious $1 trillion economy target by 2030.

Onafowokan said the target would remain difficult to achieve unless the Federal Government aggressively supports local manufacturing, value addition, affordable financing and reliable power supply, stressing that industrial expansion is also critical to tackling Nigeria’s unemployment crisis.

Speaking on the administration’s economic agenda, the industrialist said Nigeria could not depend on agriculture or the export of raw materials alone to transform its economy, insisting that the country must develop the capacity to process its resources locally.

According to him, turning agricultural and mineral resources into finished products would create jobs across the entire value chain, increase export earnings, reduce dependence on imports and strengthen the naira.

“You cannot separate manufacturing from agriculture. We don’t want to remain exporters of raw materials. Processing agricultural produce such as cocoa, palm products and shea butter adds value, creates employment and strengthens the economy,” Onafowokan said.

He explained that value addition would generate employment not only in factories but also in farming, transportation, logistics, packaging, distribution, engineering and other support services, making manufacturing a major vehicle for creating sustainable jobs for Nigerians.

Onafowokan said policies promoting local processing were already producing results, pointing to growing investments in cocoa processing and increased exports of processed shea butter. He disclosed that about $140 million had been invested in a cocoa processing plant, while exports of processed shea butter had increased significantly following policies encouraging local processing before export.

The Coleman boss also stated that Nigeria’s non-oil exports had risen from about 17 per cent to 23 percent, attributing the improvement to deliberate fiscal measures aimed at promoting domestic manufacturing and value-added exports.

Despite the progress, Onafowokan warned that Nigeria must urgently tackle high cost of funds and unreliable electricity if the country wants its industries to expand rapidly enough to drive double-digit economic growth and jobs.

He said available projections indicated that Nigeria could grow its economy to between $700 billion and $800 billion by 2030 under current trends, but achieving the $1 trillion target would require annual GDP growth of more than 10 percent.

Onafowokan commended the Central Bank of Nigeria for efforts to stabilise the foreign exchange market and moderate inflation, saying improved macroeconomic stability had helped businesses plan better. However, he warned that stability at the macro level would achieve little if manufacturers could not access affordable long-term capital.

“The challenge today is that there is stability at the macro level, but manufacturers still lack long-term financing. You cannot borrow at commercial interest rates above 20 per cent and expect industries to expand,” he said.

He also took aim at the rising lending rates of the Bank of Industry, saying the institution should return to its core mandate as a development finance bank by providing cheaper and longer-term funds to manufacturers rather than lending at rates that make industrial expansion difficult.

According to him, affordable financing would enable manufacturers to acquire modern equipment, expand production lines, establish new factories and employ thousands of additional workers, thereby making manufacturing a major weapon against unemployment.

Onafowokan identified the high cost and unreliability of electricity as another major obstacle to industrial growth, noting that power accounts for nearly 40 per cent of production costs for many manufacturers.

He said manufacturers had invested millions of dollars in independent power plants to keep their factories running but were still burdened by high gas prices, putting Nigerian industries at a disadvantage against competitors in other countries.

The industrialist therefore urged the Federal Government to urgently reduce gas prices for manufacturers, arguing that cheaper energy would lower production costs, make Nigerian goods more competitive and encourage companies to expand and hire more workers.

Beyond government intervention, Onafowokan called for a deliberate policy to nurture indigenous companies into billion-dollar enterprises, insisting that Nigerian businesses must be at the forefront of the country’s economic transformation.

“No foreigner can grow Nigeria for us. Nigerians must grow Nigeria. Government should deliberately support local companies to become billion-dollar enterprises across manufacturing, agriculture, mining and other productive sectors,” he said.

Onafowokan maintained that Nigeria could unlock its economic potential if government remained consistent with its reforms and gave manufacturers the necessary support to expand, stressing that stronger industries would translate into increased production, higher exports, more investment and millions of sustainable jobs.

He urged the Federal Government to see manufacturing not merely as another sector of the economy but as the engine room of Nigeria’s transformation, saying a combination of value addition, affordable credit, reliable energy and deliberate support for indigenous businesses could put the country firmly on the path to the $1 trillion economy target.