Manufacturing on upswing as local sourcing of inputs spirals

Merit Ibe

The Manufacturers Association of Nigeria (MAN) has admitted that there is now improvement in the local source of raw materials in the country and this is set to boost production capacity utilisation of manufacturers.

The Director-General of the association, Segun Ajayi-Kadir, in an interview in Lagos attributed this improvement on the Federal Government’s backward integration policy and the import substitution strategy which, according to him, is gaining traction among local manufacturers.

He said the level of local sourcing of manufacturing inputs has improved tremendously, affirming that government needs to sustain the implementation of the backward integration policy by properly funding relevant institutions.

The MAN boss explained further that government initiating policies that will give priority attention to the development of local raw-materials in commercial quantity and also creating more friendy environment for investment on the value-chains of these materials will go a long way in solving production challenges in the country’s industrial sector.

Ajayi-Kadir stressed that government also needs to strategically involve the private sector operators in the crafting and implementation of its backward integration policies to facilitate the creation of industry friendly and enduring policies that would not erode the little gains made so far in the nation’s industrialization drive.

He alluded to the fact that last year, President Muhammadu Buhari directed the Central Bank of Nigeria to stop providing foreign exchange for importation of food into the country, adding that members of the association were worried on the implication of the directive not affecting the progress made towards food sufficiency, conserving our foreign exchange and encouraging consumption of locally produced food.

“On local sourcing of raw-materials, no doubt, the backward integration policy and the import substitution strategy of the Federal Government is gaining traction as evidenced by responses from Chief Executive Officers of manufacturing concerns.

“We agree that the level of local sourcing of manufacturing inputs has improved. Therefore, Government needs to sustain the implementation of the backward integration policy by properly funding relevant institutions, initiating policies that will give priority attention to the development of local raw-materials in commercial quantity, creating more friendly environment for investment on the value-chains of these materials as well as ensure that adequate forex is made available for importation of vital raw materials that are at the moment, not available locally.

“Government also needs to strategically involve the private sector operators in the crafting and implementation of its backward integration policies to facilitate the creation of industry friendly and enduring policies that would not erode the little gains made so far in the nation’s industrialisation drive,” MAN director-general added.

On the Presidential directive to the Apex Bank, Ajayi-Kadir said, “As you are aware, MAN actively supports resource-based industrialisation, and this is based on our position that we should significantly improve our local sourcing of raw materials and develop sustainable value chains. We believe that value addition to products creates more jobs and wealth for the nation. Our mantra is clearly harped on patronage of made in Nigeria products as we believe the country can only experience development when we buy what we produce and produce what we consume.”