As funding challenge continues to confront real sector players, the Manufacturers Association of Nigeria (MAN) has urged the Central Bank of Nigeria (CBN) to expedite action that will facilitate the disbursement of N300 billion Real Sector Fund launched earlier in the year.
Manufacturers in Africa’s largest economy face poor funding access, particularly long-term finance, which prevents them from producing to an optimum capacity and creating sufficient jobs.
Frank Udemba Jacobs, president, MAN, said this call had become necessary given the key role played by finance in propelling manufacturing and economy.
“The CBN should expedite actions that will facilitate the disbursement of the Real Sector Fund, as no loan has been granted under this financial window despite huge applications for it,” Jacobs said at a press conference held in Lagos.
“The CBN should also make operational the Development Bank of Nigeria launched early in the year by the former president, Goodluck Jonathan,” he said.
According to MAN’s president, the Federal Government should issue a statement on policy consistency to give confidence to the private sector that is propelling the economy, while bearing huge burdens.
He said the policy should be backed by appropriate gazette that would put the implementation into phases over a reasonable period of time to safeguard the huge capital investment associated with manufacturing.
“The CBN should remove raw materials that are not available locally from the list of items not valid for foreign exchange and allow reasonable time for affected manufacturers to embark on backward integration process before relisting the affected raw materials,” Jacobs said, in response to the apex bank’s exclusion of importers of 41 items from accessing foreign exchange from the Nigerian markets.
MAN helmsman further recommended an appropriate mix of monetary instruments to promote reduction in lending rates to single digit while also effectively managing exchange and inflation rates.
The association of Nigerian manufacturers’ president admitted that real sector players are aware of the need to arrest the dwindling value of the national currency and the role of the CBN in addressing the situation by taking deliberate steps to shore up the naira, but said it is also necessary that genuine cases presented by manufacturers be given some level of consideration.
“This is to avoid creating more socio-economic problems of unemployment and crime that could emanate from the closure of factories. If the productive sector continues to find it difficult to procure necessary raw materials and spare parts within the next few weeks closure and retrenchment may become inevitable,” he said.