The Manufacturers Association of Nigeria (MAN) has made some recommendations to the federal government on how to improve the performance of the real sector in 2024.
The director-general of MAN, Segun Ajayi-Kadir, issued a statement in Lagos on Thursday, urging the government to use the savings from the removal of fuel subsidy to implement production-focused policies and structural measures to tackle inflation caused by insecurity, energy and transport costs.
He also advocated for the reform of the power sector and the promotion of investment in renewable energy sources to increase electricity supply and reduce energy costs.
He advised sub-national governments and private investors to take advantage of the opportunities created by the Electricity Act 2023 to enhance energy security in Nigeria.
He further urged the government to lead by example and give priority to made-in-Nigeria products in all its procurement and contracts.
He said the government should compulsorily increase its patronage of local products and reduce its dependence on imported goods.
He said: "The three tiers of government should enforce the implementation of the Executive Order 003 in same for their ministries, departments and agencies. The government should encourage local sourcing of raw materials through comprehensive and integrated incentives to address the challenges of low productivity and imported inflation.
"They must utilise the 2024 Budget to sustain efforts at improving infrastructure developments, especially in strategic industrial hubs, to reduce operational and logistic costs and promote competitiveness."
He also emphasised the need to maintain liquidity and transparency in the official foreign exchange market as the backlog of $7 billion in foreign exchange obligations was being cleared.
He suggested that Nigeria should manage the floating exchange rate system within a reasonable range until it becomes a net-exporting economy. He called for giving preference to foreign exchange and credit allocation to manufacturers and limiting bureaux de change to large and reputable operators.
He said this would prevent their abuses and irregularities through effective management and supervision.
He said: "Nigeria should encourage inflow of foreign direct investments into pre-determined and domestic production-enhancing businesses. We should intentionally guide Diaspora remittances into non-oil sectors, especially manufacturing, to aid foreign exchange inflows and curb rising inflation.
"The Central Bank of Nigeria should intensify its collaboration with the fiscal authority, Federal Ministry of Finance, and, by extension, the Tariff Technical Committee. This is for proper policy alignment on the appropriate HS Codes for items that Nigeria has sufficient capacity to discourage importation and save scarce foreign exchange."
He added that the apex bank should allow foreign exchange access for the importation of essential industrial inputs that are not available locally and subject them to a backward integration policy that has a clear deadline.
He said MAN "offers to be part of a monitoring and evaluation team to ensure that the government gets value for incentives offered to achieve this objective."
He also appealed to the CBN to develop a sustainable framework to channel credit interventions into the manufacturing sector beyond the direct intervention.
He also said it should encourage commercial banks to provide long-term, single-digit interest loans to the manufacturing sector to accelerate the achievement of a $1 trillion economy.
(NAN)