The Ogun State Government has pledged its commitment to developing power infrastructure that will ensure a reliable electricity supply across the state. This development is set to benefit small and medium-scale enterprises (SMEs) and other manufacturing companies.
A Promising Announcement at Manufacturer’s AGM
Speaking as the special guest of honour at the 38th Annual General Meeting of the Manufacturers Association of Nigeria (MAN), Ogun State chapter, held at the Conference Hotel, Abeokuta, Governor Dapo Abiodun emphasized the government’s determination to address the issue of irregular power supply. The event was represented by the Secretary to Ogun State Government, Mr. Tokunbo Talabi.
Highlighting the significance of stable power supply, Abiodun stated, “We cannot ignore the fact that many manufacturing firms in Nigeria have folded up due to irregular power supply and the high cost of petroleum products, resulting in high unemployment and insecurity.”
In his address, the governor acknowledged the federal government’s efforts in deregulating the upstream sector of the oil industry as a solution to this long-standing challenge. Abiodun urged the Manufacturers Association of Nigeria (MAN) to collaborate with the federal government on initiatives that will have a positive impact on the manufacturing sector. He also called on MAN members nationwide to support the present administration at the federal level.
Expert Insights on Manufacturing Sector
As the guest lecturer at the event, Mr. Bismarck Jemide Rewane, a renowned economist and the Managing Director/CEO of Financial Derivatives Co. Ltd., provided insights into the underperformance of the manufacturing sector in the last five years. He cited factors such as the Covid-19 pandemic, the Russia-Ukraine war, and forex scarcity as contributing to the challenges faced by the sector.
Rewane emphasized the need for further market reforms, including institutional reforms, rescheduling of debts, increased private investment in the power sector, implementation of the 2023 Electricity Act, digital innovation, and the elimination of revenue leakages, among other catalysts for growth.
Challenges Faced by the Manufacturing Sector
Mr. George Onafowokan, the Chairman of MAN, Ogun State chapter, echoed the concerns of the manufacturing sector. He highlighted the negative impact of policies such as Naira devaluation and subsidy removal, which had not been accompanied by appropriate buffers for sectors of the economy. Onafowokan also pointed out high power costs, exorbitant loan interest rates, cumbersome customs procedures, and multiple taxes as further obstacles to growth in the sector.
Onafowokan called on governments at all levels to enact policies that support local survival of companies, facilitate exports, simplify loan processes for government financial institutions, and implement real-sector friendly fiscal and monetary policies to revive and strengthen the manufacturing sector.
