MAN tasks FG to address electricity, hike in Diesel price, others for Nigeria to benefit from AfCFTA
Oredola Adeola
Despite the Federal Government’s strategic objective of doubling Nigeria’s export from tariff-free African trade to capture atleast 10percent of Africa’s imports by 2035, Manufacturers Association of Nigeria(MAN) claimed the objective is possible only if the government shows serious commitment to addressing the country’s electricity crisis and other macro economic issues.
Mr Mansur Ahmed, President of MAN, made this known at the 11th Business Luncheon of the Apapa Branch Council of MAN on Thursday in Lagos, themed: “Improving Nigeria’s Manufacturers Competitiveness Within the Context of the African Continental Free Trade Area (AfCFTA) implementation.”
Ahmed said that Nigeria lacks competitiveness in areas including infrastructure and electricity, which comes at a cost, citing that South African manufacturers have access to gas and electricity compared to those in Nigeria.
“Almost all manufacturers have to provide their own electricity. To provide electricity, they have to buy generators and fuel them.
“A company here will have to generate its own water and pay government for generating the water,” he lamented
He said, “There is no way any of our manufacturers can source 100 per cent of their inputs locally. There are still some things that need to be imported.”
This according to him was the feedback from members which indicated that production capacity utilization was going down due to the unsustainable cost of running daily production on diesel.
Ajayi-Kadir said that the rising price of Automotive Gas Fuel (AGO) otherwise known as diesel had become very worrisome following its negative impact on businesses especially the manufacturing sector of the economy.
He noted that the latest twist was caused by the scarcity induced by the war between Russia and Ukraine causing an increase in the price of crude oil in the international market which has now gone above $110 per barrel.
“Knowing also that diesel has been deregulated removes the question of a buffer to the cost.
The MAN DG stated that the percentage increase arrived at from the drop in 5,340MW electricity in the Year 2020 to 2,000MW in 2022, representing 63 percent change citing Pizza that is bought at N2,800 in 2020 now averaged N3500 in 2022, indicating 25 per cent increase.
The change in the price of Diesel averaged 294.7 per cent following the increase in its price from N190 in 2020 to N750 in 2022. while the price change of Petrol which rose from N145 in 2020 to N200 in 2022 represents a 37.93 percent change. As part of the effort to address the crisis on its part.
MAN therefore noted that the Association will continue to advance discourse that would stimulate a drop in the operating cost of production in Nigeria.
