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Duty-free industrial tools: Will the govt comply?

By Helen Ovbiagele

For some time, I had this feeling that the Manufacturers Association of Nigeria (M.A.N.), which is the mouth-piece of  manufacturers in Nigeria, had stopped functioning, since I’ve not been reading of  its reactions to government’s policies regarding the production sector in this country.

In the seventies and the eighties, the association held sway and it was a force to be reckoned with.  Foreign companies here at that time held it in high esteem, along with NECA., and they made it a point to join these organizations so that they could be part of  active bodies of manufacturers and employers.

When recently I saw the headline ‘MAN lists woes, wants production tools duty-free’ in the Guardian, I rejoiced; ‘At last, MAN has woken up from its slumber’, I told myself.  Maybe the body has not actually been asleep, who knows?

The piece  which was written on a workshop organized by the Ministry of Trade and Investment in Lagos, showed that the association was still alive to its role in this country. Thank God!  Part of it went, ‘Through the President of MAN, Chief Kola Jamodu, the industrialists particularly demanded the removal of duty or tariff on machinery and equipment, to stimulate activities in the manufacturing sector.

Chief Jamodu said there was need for the Federal Government to put in place measures that would expand domestic production, boost exports, generate employment and create a level  playing field. He lamented the high cost of providing independent power to factories by MAN members, stressing that power supply account for 40% of production costs in Nigeria, compared to 5-10% in countries with more stable electricity supply. “It costs twice to manufacture a product in Nigeria than in China,” he claimed, noting that “Nigerian firms are going through hard times.”’

Of course they are, and have been for quite some time and through several administrations. MAN’s president’s statements are in line with my thoughts on the state of our manufacturing sector, and its contribution to the high rate of unemployment in the country.

President Goodluck Jonathan

We all know that a high rate of unemployment without the cushion of unemployment benefits from the government, like in some western countries, leads to intense financial hardship in the land, a high rise  in criminal activities, unwanted pregnancies and abandoned babies. Everyone of us is affected by at least the effect of one of these; if not directly, then by proxy.

If you have a job or run a good business and are comfortable, criminal activities in one form or the other, could prevent the growth of your wealth/business, and stop you from enjoying the fruits of your labour in peace.  So, we all have to be concerned about the state of our industries, and anxious about the issue of  high unemployment in this country.

One doesn’t have to be an expert to reason that the establishment of industries is a plus for any country. Big ones; small ones – they are all important to our well-being.  Most Nigerians are enterprising and they would struggle to find a means of livelihood.  Look at the various ways our women who do not have much education eke out a living to sustain their families!.

They work on the farm if they’re in the rural area, cultivate cassava and engage in the back-breaking task of turning it into garri, fufu, lafun, etc.  Some are hunters of small animals; some gather fire-wood for sale; some fish; and others sell one thing or the other.

In the cities, those who can’t afford market stalls, become hawkers and roadside traders.  Fast going are the days when women could afford to be only home-managers, and rely on what the man brings in.  The reality these days is the man can lose his job at any time, so, the woman has to engage in something that would earn her some money so that the family can have something to fall back on.

Education, which used to be a sure ticket to good earning and a comfortable financial life, is no longer always that these days.  We have almost one hundred universities in the country, and each year they pour out graduates to join the unemployment market.  Only a small percentage have ready jobs of their dreams available to them.  The majority will roam about the streets job-hunting for quite a while.

In spite of this, most families still strive to send their children for higher education as they believe that this would increase their chances of landing good jobs which would help improve the financial status of these families.  So, they slave away to give their children university education.  Hopes are high when these children graduate.  For many of them, the mandatory national youth service job may be the only employment they may have for several years as they trudge the streets with their curriculum vitae, looking for jobs.

This is why, in spite of the risks involved in serving these days, (accidents,  attacks and murder by militants in hostile host communities), many graduates don’t want the service scrapped.  Prolonged job hunt means some graduates may become a financial burden to their families, instead of bringing the much expected financial succour to them.

Some,  out of desperation may even apply for jobs beneath their qualifications, but in vain.  Imagine the frustration, the dejection, the humiliation and the depression of these young people!  A few decide to end it all and commit suicide.

Am people-friendly government which is alive to its responsibility, knows that job provision is of utmost importance to its citizens; not only for the financial relief this brings, but also to sustain their self-esteem.  The first thing to go when there’s no hope of a job is your self-esteem.

Now, the government cannot give employment to everyone in its civil service, and frankly, I haven’t  heard of any government that has been able to run a successful business.  Whatever industry the government tries to set up usually ends up in smoke.  Think of  cement, rubber, palm oil, steel, cocoa, etc.  This means we need the private/manufacturing sector to create employment for our citizens. A responsible government would be aware of this and would ensure that it creates a conducive environment/atmosphere for this; instead of making policies that would destroy industries.

One doesn’t need to be an expert on trade and manufacturing to reason that for an industry to thrive, it needs affordable machinery and spare parts, a ready supply of affordable raw materials, and a steady supply of electricity, among other things.

All the small-scale manufacturers I spoke  to, lament that poor electricity supply and the extremely high duties that are charged on machinery, spare parts and raw materials are their major headache and the reason their products are priced high.

“Added to all these, madam,” said one of them, “the market for our products is flooded with cheap versions from the Far East.  We just couldn’t compete with their prices.  Even if we wanted to sell at production price, our product would still be much higher than the imported versions. Who would want to buy the local version when the imported one is much cheaper?”

I think the government should act positively on the recommendations from MAN, to save industries and jobs.


Comments expressed here do not reflect the opinions of vanguard newspapers or any employee thereof.