In 2023, the Nigerian manufacturing sector faced a significant blow, with 767 manufacturers shutting down their operations and 335 others facing distress. The Manufacturers Association of Nigeria (MAN) Director General, Ajayi Kadiri, expressed concern over the challenges faced by manufacturers in the country, exacerbated by the recent introduction of the Expatriate Employment Levy (EEL) by the Federal Government.
President Bola Ahmed Tinubu unveiled the EEL handbook last week, imposing a levy ranging from $10,000 to $15,000 on employers who hire expatriates in Nigeria. MAN strongly criticized this move, citing the already existing hardships caused by soaring inflation in the country.
The Association highlighted the detrimental impact of the EEL on the manufacturing sector and the economy as a whole. With the manufacturing sector already facing numerous challenges, the additional cost burden imposed by the EEL could not have come at a worse time. The inventory of unsold finished products has surged to N350 billion, while real growth has plummeted to 2.4 per cent.
Since the removal of fuel subsidies and the floating of the Naira in June last year, Nigeria has been grappling with a staggering inflation rate of 29.90 per cent as of January 2024. The economic landscape remains challenging, with manufacturers bearing the brunt of the crisis.
The introduction of the EEL has further exacerbated the woes of the manufacturing sector, leading to closures and distress among companies. MAN’s plea for reconsideration of the levy underscores the urgent need for supportive policies to revive the ailing manufacturing industry in Nigeria. As the country navigates through these turbulent times, the resilience of its manufacturers will be put to the test.
