Manufacturers in Nigeria have asked the Federal Government to subside the production industry as a way of addressing the adverse effects of the rising costs of production and help businesses grow.
The Manufacturers believe that, rather than taking the available resources and give it out just as a one-off palliative and the people become poorer afterwards, the Government could re-channnel it as incentives for local producers in Nigeria, to encourage local productions and boost the economic fortune of the country.
They made this call at the stakeholders engagement forum, organised by the Manufacturers Association of Nigeria (MAN), in Anambra state, where they also discussed how small businesses can access funds for growth.
With the theme, ‘Access to Finance and Cheaper Funding for SMEs in Nigeria’; the Forum, comprises of African Export – Import Bank (AfrExIm Bank); Small & Medium Enterprise Development Agency (SMEDAN); Bank of Industry (BoI); Commercial Banks; State Government; Captains of Industry and stakeholders in manufacturing sector; identified lack of access to finance, poor infrastructure, insecurity, high taxation, policy inconsistencies and others, as some of the major challenges affecting businesses in Nigeria.
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In her opening remarks, the Chairman of MAN in Anambra, Enugu and Ebonyi zone in South East region, Lady Ada Chukwudozie, said, it was better to give incentives to manufacturers that will enable them produce more, saying, when they produce more, they create wealth, they create jobs and the economy will now boost; they will have enough finished products for exports; that way, inflation will crash and naira will begin to appreciate against the dollar.
She said, “the current ways of trading via heavy importation of finished goods and exportation of commodities has expired. We should embrace industrialization and export finished products while importing more of raw materials.
“Our very successful traders should be encouraged to partner with their suppliers overseas as their local content drivers and manufacture products in the region in order to take the advantage of the AfCFTA , this big market that it has created in order to create more wealth, more jobs and inadvertently bridge the gap of transfer of technology.
“Our subsidizing consumption should be discouraged and instead, provide subsidies for production. Government should also provide investment incentives, such as land, tax breaks, grants, or subsidies to manufacturers who invest in upgrading their machinery, technology, and processes to boost productivity and competitiveness.
“Currently the trajectory of the discussions are on productivity, about industrialization, about the need to make the economy a productive economy than a consumption based economy. How to transform the economy from one which exports commodities and imports finished goods, to one which exports finished goods and imports raw materials. DFI should encourage Government to subsidize production more than consumption”.
Chukwudozie also stressed on opening more opportunities for Manufacturers to have access to funding, saying, “access to information and access to cheap funding remains the nucleus and at the center of productivity and industrialization in Nigeria”; while urging stakeholders to register with AfrExIm Bank MANSA platform, to take their business to the next level.
On his part, the Director-General of SMEDAN, Dr. Charles Odii, said the agency had started some interventions at ensuring local manufacturers have access to soft loans.
Odii said, “we are here in Anambra state and special thanks to His Excellency, the Governor of Anambra state, who has signed a memorandum of understanding to the tune of one billion naira, where manufacturers and small businesses in Anambra state can access funds from, as little as 250,000 to 2.5 million naira at a single digit interest”.
Speaking on how the manufacturers in Nigeria could access the loans being provided by Afrexim Bank via MANSA Initiative, Mrs. Maureen Mba, Head of Afrexim Bank MANSA Initiative and former Executive Director, Compliance, urged the stakeholders to get certain code that would qualify them as MANSA entities.
“I thank God, SMEDAN has come to join forces with us to ensure that all entities they are giving out the loans to are MANSA verified. What do I mean by that? They have their AEI code which is the African Entity Identifier code. That code allows those institutions to actually assess the fund of SMEDAN”, Mrs. Mba said.
