Boycotting industrial stage may deter import substitution – Yemi Kale

The Managing Director of the National Bureau of Statistics, Yemi Kale, said at the 2016 Standard Bank West Africa Investors conference, that ignoring the industrial stage over the years has resulted in the huge industry deficit in the country.

This further explains the impracticability of import substitution in Nigeria at a time where the imports are not produced locally.

However, Kale said he is convinced that foreign investors can offer a helping hand to the government in bridging it considerably by partnering on the huge capital projects to be embarked on in 2016.

Kale stressed that unless FDI is attracted local industries may be incapable of boosting production capacity to meet demand for their products.

“Countries transform from the agricultural stage to an industrial stage and end up in the service stage. Nigeria took a different path and went from agriculture to services, ignoring the industrial stage. Now we are going back to the industries”, he asserted.

The transition from an import dependent economy to an export oriented one would require the industries to function efficiently, analysts have stressed.

“Do we ban goods we can’t produce or encourage the companies that produce those commodities to come and set up in the country?” Kale asked rhetorically.

The government’s stand on the valuation of the currency has translated to bearish investors who are uncertain of an exchange rate policy regime that threatens the foundations of macroeconomic stability.

“Investors do not like heightened uncertainty because it confronts them with questions that they cannot answer and successfully explain”, said Atedo Peterside, Chairman Stanbic IBTC.

Consequently, the investment that ought to suffice for the deficit in industries which portends an increase in local production has been hampered considerably.

Bridging the industry deficit is pertinent in the clamour for economic diversification, he opined, because the industries ought to be resuscitated if production rate is to soar above local demand to compete globally.

 

LOLADE AKINMURELE & CHIGOZIE EGWUATU