By Merit Ibe [email protected]
Inconsistency and lack of proper policy formulation by the government have been blamed for the sluggish growth and development in the manufacturing sector.
Operators also argue that the manufacturing sector has not attracted significant investments in comparism with those of other countries due to regulatory inconsistency. Frequent reversals of government policies, lack of implementation of the provisions in national policy documents and regulatory lapses are key factors that have affected the sector.
The Manufacturers Association of Nigeria (MAN) has also confirmed that apart from other hinderances in the sector, inadequate electricity supply and the high cost of alternative energy sources are the topmost challenges hampering the performance and growth of the sector.
Stakeholders in the sector note that in the past, several industrial policies have been reversed mid-way, eroding the gains that could have been obtained.
The Export Expansion Grant (EEG), for instance, was targeted at raising the competitiveness of Nigerian products at the global market. But the grant had been suspended several times.
Nigeria faces several hindrances in achieving its economic and developmental goals. But, one of the most profound is policy inconsistency and discontinuity. The lack of stability and continuity in programmes by succeeding governments have been the bane of Nigeria’s stunted growth and development. Very few policies have stood the test of time.
The uncertainty and irregularity of government policies also pose a problem for the macroeconomy. Foreign investors are not flooding into Nigeria regardless of the numerous opportunities in the country. Many investors have identified the lack of predictable policymaking as one of the reasons for keeping their distance. But, investors are not the only ones concerned.
Nigerians themselves do not trust the system and are reluctant to buy into national government agenda because of the long history of patchiness in government policy.
Stakeholdrs believe that the erratic nature of policy is also a financial sinkhole in the economy and leads to high costs, which can’t be recovered regardless of the outcome of the investment. Take for instance all the money the Nigerian government has poured into policies and projects that were never fully actualised – like the Ajaokuta steel factory; 41 years and billions sunk in the project, yet, the factory has failed to produce any steel.
President, MAN, Mansur Ahmed, faulted government over its inability to strengthen policies geared at boosting the productive sector.
Ahmed noted that to a large extent, hindrances experienced in the productive sector are largely caused by policy inconsistency and somersaults, which leave no room for proper planning and projection.
He observed that in spite of the several Central Bank of Nigeria (CBN) policies such as the Naira4dollar scheme, Ban of Sale of Forex to BDCs, the proposed RT 200 FX Programme which stands for the “Race to US$200 billion in FX Repatriation and others, much seems not have been achieved.
While he commended the good intention of the CBN for these policies, particularly to drive support for the real sector of the economy, MAN president stressed that there was need to establish mechanisms for robust monitoring and evaluation which ought to be part of the plan to ensure that the support to drive export really comes to fruition.
He said the association which represents the interest of manufacturers in Nigeria, has offered to be a part of this process, adding, “we shall continue to offer recommendations to the government that will increase manufacturing sector’s contribution to the nation’s GDP.”
Managing Director, Obsteel Management Limited, Kelly Feala, described government’s policies as necessary for orderly and rapid economic development.
According to him, what the country suffers is lack of policy direction and lack of appropriate policy guidelines.
He stated that the country’s slow development was due to the direction of government policies, adding that appropriate government policies and economic directions were needed for the private sector to come in and invest in any sector.
Oluchi Kome, Smoothies Class, described the attraction of capital inflow into the economy as a function of a credible government.
She said if policies of government were credible and consistent, it would be easy for people to invest their resources in the country.