Recent MPC Decisions are Crippling Manufacturing Activities in Nigeria – MAN

By Barnabas Esiet.

The Manufacturers Association of Nigeria (MAN) has expressed concerns over the recent decisions made by the Monetary Policy Committee (MPC), stating that they are negatively impacting manufacturing activities in the country.

In a statement issued by MAN’s Director General, Segun Ajayi-Kadir, the association urged the MPC to carefully consider the consequences of its actions on the manufacturing sector.

MAN emphasized the importance of collaboration between the MPC and fiscal authorities to support the industry, which plays a crucial role in creating jobs, boosting productivity, generating foreign exchange earnings, and driving economic growth.

While acknowledging the MPC’s efforts to address economic challenges such as inflation and exchange rate instability, MAN pointed out that the continuous increase in the prime lending rate over the past two years has not yielded the desired results for the manufacturing sector.

The statement called on the new administration at the Central Bank of Nigeria (CBN) to explore alternative measures to address the underlying causes of inflation, which are primarily driven by cost-push factors.

The association urged the MPC to assess the impact of its monetary policy decisions on the manufacturing sector and the overall economy, emphasizing the need to strike a balance between macroeconomic stability and industry growth.

In addition to recommending closer coordination between monetary and fiscal authorities, MAN proposed measures to enhance security in farming areas and business environments, including the passage of the Police Reform Bill and investments in surveillance systems and community policing.

The Association also advocated for measures to stabilize the value of the naira, improve liquidity and transparency in the forex market, prioritize forex and credit allocation to manufacturers, and expedite the recapitalization of the banking sector.

The manufacturers organisation stressed the importance of reducing reliance on imported products and raw materials by incentivizing investment in local production and sourcing, as well as improving infrastructure in industrial hubs and promoting investment in renewable energy to reduce logistics costs and enhance competitiveness.

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