Better days seem to be ahead for Small and Medium Scale Enterprises, SMSEs, and other manufacturing companies, as the Ogun State government said that it is committed to building power infrastructure that will guarantee stable electricity supply across the state.
The state governor, Prince Dapo Abiodun, stated while speaking as the special guest of honour at the 38th Annual General Meeting of the Ogun State chapter of the Manufacturers Association of Nigeria, MAN, which held at the Conference Hotel, Abeokuta.
Represented by the Secretary to the Ogun State Government, SSG, Mr Tokunbo Talabi, Abiodun said that the government is taking full advantage of its opportunity as the state with the widest gas reticulation in Nigeria to address the menace of irregular power supply, saying that when the issues of high cost of petroleum and irregular power supply is adequately tackled, it will forestall the high rate of unemployment and insecurity.
The governor said, “We cannot pretend not to be aware that many manufacturing firms hitherto operating in Nigeria have folded up due to irregular power supply and the high cost of petroleum products, a situation that has resulted in high unemployment and insecurity.
“It was with that determination to change the narrative and redirect the economy for greater performance in the real sector that the President Bola Ahmed Tinubu-led Federal Government summoned the courage to address the age-long conundrum in the upstream sector of our oil industry through the deregulation policy that led to the removal of subsidies.”
Enjoining MAN not to hesitate to interface with the Federal Government on initiatives they know will impact the sector positively, Abiodun appealed to members of the association all over the country to support the present administration at the federal level.
Speaking as the guest speaker at the event, a foremost economist and Managing Director/Chief Executive Officer, MD/CEO of Financial Derivatives Company Limited, Mr. Bismarck Jemide Rewane, said that the manufacturing sector has mostly underperformed in the last five years, highlighting some of the reasons to include the COVID-19 pandemic, the Russia-Ukraine war as well as forex scarcity.
Rewane said that the nation is at a crossroad as the naira is undervalued at 32 percent, but acknowledged that the new administration at the federal level has taken a bold step in implementing some key market reforms, reducing the level of market distortion in the economy, among others.
The renowned economist advised the Federal Government to continue on reforms, including the rescheduling its debts, institutional reforms, increase private investment in power sector, enumerating the catalyst for growth, road concessioning, implementing the 2023 Electricity Act, digital innovation, boost investment flows, pay at least N75,000 as minimum wage and block revenue leakages among others.
The Chairman of the Ogun State chapter of MAN, Mr George Onafowokan, in his address, noted that the immediate implementation of the dual policies of naira devaluation and subsidy removal without putting in place appropriate buffers for all sectors of the economy has caused inflation levels to sky rocket and has put immense strain on the manufacturing sector.
Onafowokan further commented on the high power costs, high interest on loans, post and custom related issues as well as multiple taxes as banes to necessary growth in the sector, urging government at all levels to be committed to engendering policies that promote local survival of companies and facilitate export, simplify the prices for qualifying for loans from government financial institutions coupled with other real sector friendly fiscal and monetary policies to revive and strengthen the manufacturing sector.
