.

…makes case for S-west govs to institute effective mechanism to ensure sustenance of existing manufacturing companies

By Adeola Badru

The Manufacturers Association of Nigeria (MAN), yesterday, urged the Federal Government to remove the 7.5 per cent Value Added Tax (VAT) on Automotive Gas Oil (AGO) also known as diesel, pending the normalisation of internal supply system and quick resolve of the complexity surrounding the seamless implementation of the Eligible Customer Initiative.

This, the association said, would enable manufacturers to take the advantage of the stranded electricity.

The President of MAN, Mansur Ahmed, made the appeal, while speaking at the 39th Annual General Meeting, AGM, of Oyo, Osun, Ondo and Ekiti States branch of the association with the theme: “Sustainable Public Private Partnership: “Disruptive Innovation for Inclusive Growth,” held in Ibadan.

Ahmed, who was represented at the event by the Vice-President, Lagos branch, Otunba Francis Mesioye, called on government to urgently convene a strategic meeting with key operators in the Nigerian economic space to deliberate and craft a national strategic response to the disruptive impact of the ongoing Russian-Ukraine war on the global supply value chain and its debilitating impact on the economy.

He said: “Government should remove the 7.5% VAT on the AGO pending the normalisation of the international supply system and quickly resolve the complexity surrounding the seamless implementation of the eligibility customer initiative to enable manufacturers to take advantage of the standard electricity.”

“We believe that this will help to identify viable options to ameliorate the impact of the disruption, agree on ways to assuage other pain points on the business environment, activate innovative solutions to familiar and emerging macroeconomic and infrastructure challenges and generally point the director for resilience in the economic ecosystem.”

“The government should prioritise allocation of foreign exchange to the manufacturing sector and that the CBN should direct commercial banks to transparently and diligently process forex applications by manufacturers. It is also important to improve the time taken to clear container/cargo at the ports to reduce the various port charges and remove demurrage for unduly delayed clearance.”

While the association called on the government to prioritise allocation of foreign exchange to the manufacturing sector, it also made it known that owing to the lackluster performance of the nation’s economy, it has become imperative for MAN to rethink the country’s development strategy in order to avoid the unpleasant consequences of the economic recession and reversal of the modest progress the association has recorded since the recent setback occasioned by the COVID-19 pandemic.

“To this end, it is again necessary that the Federal and state governments, together with their agencies, work in synergy, carrying along relevant stakeholders, in fashioning appropriate strategies to improve and stabilise the economy,” he posited.

Ahmed, however, called on the governments of Oyo, Osun, Ondo and Ekiti States to institute a more effective and efficient consultative mechanism with the association to ensure the sustenance of existing manufacturing companies, some of which he said, were on the verge of collapsing under the weight of overwhelming infrastructural and other challenges.

“We urge you to harken to the need of businesses for appropriate incentives and infrastructure that would ameliorate the business constraints and encourage new investors. In this regard, we request that you carry out a system check on the regulatory functions of certain agencies and organs of government that negatively impacts manufacturing and discourage would-be investors.”

Earlier in his address, the Chairman of the Oyo, Osun, Ondo and Ekiti States branch of the association, Mr. Lanre Popoola, bemoaned the inability of the government to harmonise the taxes of local, and state ministries, departments and agencies, which he noted, posed another challenge for manufacturers to budget effectively.

He lamented that despite all economic policies introduced by various arms of government and their agencies, businesses are still struggling and environment still very challenging and toxic.

“Multiple issues like hike in petroleum prices, unstable power, forex are still very prevalent and these issues make economic planning very complicated, not to mention over zealous consultants set on reaching targets to the detriment of manufacturers who have been classified as ‘cash cows’ and ‘golden geese,” he said.

Speaking on behalf of the Oyo State government, acting Governor, Bayo Lawal, charged members of MAN to strengthen their vibrance in providing employment for Nigerian graduates, saying relevant agencies should be interested in positivity.

He, then, promised the state’s readiness to continue to create an enabling business environment for human and material capital to thrive.

Subscribe for latest Videos

Disclaimer

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