Experts see efficient infrastructure stimulating Nigerian industries

Nigerian industries require efficient and effective infrastructure to boost the economy, according to experts.

“Increased spending in-country on infrastructure projects injects significant liquidity into the economy, provides the enabling environment for investments and manufacturing and eventually also provides the needed employment and growth,” said Chuma Ezedinma, officer in charge of UNIDO Regional Office, Nigeria in an interview with BusinessDay.

Nigerian industries are hard hit by energy crisis,which has shot up production costs. Nigerian manufacturers spent N59 billion on gas, diesel, inverters and other forms of energy in 2015, as against N25 billion spent in 2014, according to the Manufacturers Association of Nigeria (MAN). This represents 135.28 percent spike from N25 billion spent by manufacturers on alternative power sources in 2014.

Thirty to forty percent of manufacturers’ expenditure goes to alternative power sources. Large-scale manufacturers use mainly gas because it is cheaper, while medium-scale players operate majorly on diesel. Small-scale players use more of fuel to power their operations.

Manufacturers also battle high gas price, poor road network as well as decrepit and inefficient rails.

The sector is also challenged by the poor state of roads leading to major ports in Nigeria.

The Lagos Chamber of Commerce and Industry (LCCI) says the state of Apapa roads leads much to be desired, calling for repair of the infrastructure to ease movement of goods and raw materials in and out of the country, as the case may be.

Nigeria’s infrastructure gas is estimated at $300 billion.

NAN quoted Olu Ajakaiye, executive chairman, African Centre for Shared Development Capacity Building (ACSDCB), as saying that infrastructure deficit in the rural areas was a major challenge to achieving industrialisation in Nigeria.

Ajakaiye had told NAN that infrastructural development had been skewed in favour of urban areas leaving out the countryside to develop at a very slow pace.

He said that this had caused a huge gap in the industrialisation process as it was not east to evacuate farm produce to industries located mainly mostly in urban areas.

“So we need a highly integrated infrastructural programme which will break the divide between the rural and urban areas,’’ he was quoted as saying.

 

ODINAKA ANUDU with agency report