…N4.12trn in 5 years — MAN
By Naomi Uzor
Manufacturing sector may have recorded a rebound in investment flows in the first half of 2018, H1’18, with a total of N305.56 billion new investments, a huge 72.9 percent jump over N176.69 billion recorded in the preceding half, H2’17.
The sector had witnessed a huge dip in investment in H2’17 against H1’17 which had recorded a N329.28 billion investment, indicating that the rebound in H1’18 was still behind the corresponding period of 2017 by about 7.2 percent.
These are contained in the Manufacturers Association of Nigeria (MAN) H1’18 review obtained by Vanguard, which also put investments in Nigeria’s manufacturing sector between 2013 and 2017 at N4.12 trillion, based on data generated from its surveys over the period.
In the survey report, MAN stated: “Assets under Construction ranked highest with investment worth N149.14 billion; investment in Plant and Machinery was N110.47 billion; Land and Building was N32.84 billion; Motor vehicle was N9.93 billion; and Furniture and Equipment was N4.18 billion in the first half of 2018.
“Sectoral group analysis shows that the highest proportion of total manufacturing investment in the first half of 2018 went to Food, Beverage and Tobacco group. Investment in the sector stood at N86.94 billion, N4.13 billion (4.5 percent) lower than N91.07 billion of the corresponding half of 2017 and N14.2 billion (19.5 percent) of N72.74 billion of the preceding half.”
The analysis of the report showed that a the biggest chunk of the manufacturing investment (N95.31 billion or 31.2 percent) in the H1’18 went to Ogun zone.
It showed that Apapa zone recorded investment worth N93.67 billion (30.7 percent); while investment worth N54.80 billion (17.9 percent) went to Ikeja zone in the period.
“Investment in Ogun zone stood at N95.31 billion in the first half of 2018, up by N1.55 billion (1.7 percent) from N93.76 billion recorded in the corresponding half of 2017. However, it shows an increase of N44.2 billion (86.5 percent) from N51.11 billion recorded in the preceding half”, stated the report.
The report also indicated that the performance of manufacturing sector in the first half of 2018 was strongly influenced by macroeconomic developments in the period.
Generally, macroeconomic indices slightly improved in the period given the deceleration in inflation rate, growing External Reserves, stable foreign exchange market and the steady high crude oil price in the international market.
However, MAN stated: “Consumption continued to dampen due to high commodity prices strongly induced by unfavourable exchange rate parity, its impact on cost of production and the general consumer real disposable income. Moreover, over-regulation and the attendant multiple charges, and non-synchronic commercial policies affected activities in the sector negatively within the review period.”