BusinessDay 26 Feb 2018

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26 BUSINESS DAY C002D5556 Monday 26 February 2018 REAL SECTOR WATCH Manufacturers make N4trn investment in 54 months ...as inventory of unsold goods stands at N160bn L-R: Toki Mabogunje, deputy president, Lagos Chamber of Commerce and Industry (LCCI); Babatunde Paul Ruwase, president of LCCI; Yemi Osinbajo, vice president of Nigeria; Michael Olawale-Cole, vice president of LCCI; and Agnes Shobajo, vice president of LCCI, during LCCI’s courtesy visit to the vice president in Abuja recently ODINAKA ANUDU Manufacturing investments from January 2013 to June 2017 stood at N4.12 trillion, according to data coming from the Manufacturers Association of Nigeria (MAN). The cumulative investments in the 54-month period indicate the level of contributions made by Nigerian manufacturers to the economy. Meanwhile, inventory of unsold finished goods in the manufacturing sector rose in the first half (HI) of 2017 to N159.59 billion, from 54.93 billion recorded in the corresponding period of 2016, indicating N104.66 billion or 190.5 percent increase over the period. This also signifies N124.17 billion or 350.6 percent jump when compared with N35.42 reported in the second half of 2016. “The increase in inventory of manufactured finished products was attributed to poor sales particularly in food, beverage and tobacco, non-metallic mineral products, and motor vehicle and miscellaneous assembly,” MAN’s report says. Sectoral analysis shows that 30.8 percent of total inventory (N159.59 billion), that is N49.13 billion, was recorded in the food, beverage and tobacco group. Also, 22.3 percent was reported in the nonmetallic mineral products, while 17.05 percent was observed in motor vehicle and miscellaneous assembly group in the review period. Inventory of unsold finished goods in food, beverage & tobacco sector increased to N49.13 billion in H1 of 2017, from N4.01 billion recorded in the corresponding period of 2016, indicating a N45.12 billion increase over the period. It also increased by N43.12 billion when compared with N6.01 billion recorded in the preceding half. Inter-zonal analysis shows that 41.6 percent (N66.36 billion) inventory of unsold manufactured products was recorded in Ogun zone. Thirty-six percent (N57.39 billion) was reported in Ikeja, while 9.6 percent (N15.26 billion) was noted in Apapa zone. These three zones (Ogun, Ikeja and Apapa) also recorded the highest production value in the period under review. Inventory in Ogun stood at N66.36 billion in the period under review, from N10.87 billion recorded in the corresponding period of 2016. This indicates a N55.49 billion increase over the period. It also increased by N60.29 billion when compared with N6.07 billion recorded in the preceding half. In order to reduce inventory of unfinished goods, MAN wants the Federal Government to monitor and enforce the recent Executive Order 003 on patronage of madein-Nigerian products in ministries, departments and agencies (MDAs). The association wants further construct a margin of preference (preferably 30 percent), which will be applied by MDAs in their procurement processes. It urges the state and local governments to embrace patronage of made-in-Nigeria products by toeing the footsteps of the Federal Government. “It is important to sustain, monitor and enforce that the Executive Order on micro, small and medium enterprises. There is a need to create a sustainable platform through which Nigeria’s general public will be continuously educated on the need to jettison the current penchant for foreign goods and patronize locally manufactured products,” MAN advises. The association calls for close monitoring of smuggling, adulteration and counterfeiting activities in the country with stricter penalty on those found culpable of the offences. MAN pledges support for SON’s fight against fake products The Manufacturers Association of Nigeria (MAN) says it will continue to support the Standards Organisation of Nigeria (SON)’s fight against fake and sub-standard products. Similarly, the SON has read riot act on adulterators of lubricants, warning them to desist from such unscrupulous activity to avoid prosecution. Speaking at a sensitisation workshop organised by SON in Yola, Adamawa State capital recently, Ahmed Jarma, chairman, North- East zone of MAN, said there was a need for collaboration between MAN and SON to tackle the influx of substandard products into the country. According to Jarma, the effects of substandard products in the country could be so devastating that only mutual collaborations could stop it. “Substandard products are everybody’s enemy, yet people engage in peddling them for selfish economic gains at the expense of national and individual economic interest. “It is only all of us as patriotic Nigerians that can collectively put a halt to this trend on both domestic and imported substandard ..as SON reads riot act on faking of lubricants products,” he said. Jarma noted that the objectives of MAN and the functions of SON indicated that both had the common goal of formulating and promoting policies that specifically promoted a healthy industrial development in the country for stable economic growth. Commending SON ACT 2015, the manufacturer said: “The Act sets out to sanitise the nation’s industrial, commercial, business and market place of substandard products. It is in tandem with the economic diversification, economic growth and recovery, industrial and agricultural revolution programme of the federal government. Therefore, using the instrumentality of the ACT, Nigeria could attain economic development via standardisation, quality assurance and control as well as monitoring and compliance”. Speaking earlier at the forum, Osita Aboloma, SON’s directorgeneral, represented by Sunday Galadima, Adamawa State’s coordinator of SON, assured stakeholders that the regulatory agency remained unrelenting in the antisubstandard products battle. “Within the last few months, we have confiscated fake and substandard products worth over N300 billion across the country. We have since embarked on arraignment and trial at the various courts- of some of the suspects linked with the impounded goods”. Meanwhile at another meeting with the Lubricant Producers Association of Nigeria last Wednesday in Lagos, Aboloma charged lubricant dealers to leverage the growing auto industry, pointing out that the industry was critical to Nigeria’s industrialisation drive. He read riot act to unscrupulous dealers faking genuine products and deceiving unsuspecting consumers to desist from that, as the SON had given the agency prosecutorial powers. “SON will not sit back and watch some unscrupulous people threaten the life of the industry. We will not sit back and watch these people pull down the investment of established brands. As long as you are law abiding, we will be there to protect you,” he said. He urged all stakeholders to always consult SON for minimum requirements of the Nigerian Industrial Standards (NIS) in order to produce in line with global standards. “We cannot do it alone and we need your assistance. The standards are there and they have been brought at par with international best practice. We will sit down and critically look at challenges you have now and fashion out a way to deal with them collectively and decisively,” Aboloma told lubricant makers. Mustapha Ado, chairman/CEO of Ammasco International Limited, said the industry was faced with a number of challenges, ranging from adulteration to faking of established brands, tasking SON to address the issue head-on.
Monday 26 February 2018 C002D5556 BUSINESS DAY 27 REAL SECTOR WATCH R-L:Wale Adegbite, chairman, Ogun State branch of Manufacturers Association of Nigeria (MAN); Bimbola Ashiru, Ogun State commissioner for commerce and industry; Babi Subair, special adviser on One-Stop-Shop and Jonathan Onajobi, permanent secretary of the Ministry of Trade at the 12th quarterly meeting of MAN and Ogun State government in Abeokuta weekend. Pic by Razaq Ayinla UK targets bigger real sector investments in Nigeria David Ibemere Exciting days lie ahead, as the British government says Nigeria remains a top priority on its push to increase more direct investment into Africa, and talks have already begun with the Ministry of Industry, Trade and Investment to achieve the target. The UK is interested in all sectors of the economy, but more importantly in Nigeria’s burgeoning real sector. Laure Beaufils, deputy British high commissioner said weekend, at an advocacy roundtable organised in Lagos by the Nigerian-British Chamber of Commerce(NBCC), entitled ‘The Ease of Doing Business in Nigeria’, that the government was starting a …puts Nigeria top on investments into Africa new project called ‘Overseas Direct Investment(ODI)’, specifically driven to promote more British- Nigeria trade. “The United Kingdom, the UK Trade & Investment, in collaboration, is working closely with Nigerian Investment Promotion Commission and other bodies to increase UK investment in Nigeria,” Beaufils said. BusinessDay checks on UK Office of National Statistics show that as of third quarter (Q3) of 2017, Nigeria exported goods valued at £17 million to the UK, while the import from the UK to Nigeria stood at £134 million. However, Beaufils stated top British companies already had deep footprints in Nigeria, importing and exporting various products. “In the coming years there will be positive growth figures on trade volume between Nigeria and the UK, as the commission is ready to champion various programs that will lead to a free, fair and inclusive trade with mutual benefit. “We are very ready to improve on trade relationship with Nigeria, and help attract U.K investors into Nigeria’s capital market, Nigerian Stock Exchange.” Beaufils recalled that the British Government on Feb. 9, through its export credit agency, UK Export Finance (UKEF), said it would accept naira payments from Nigerian business owners trading with the UK. She said the initiative was a monumental step that would deepen trade, open more opportunities, expand patronage and market scope of products from both countries. Commenting on Nigeria perception in the UK, she said Nigeria had more role to play in making the narrative change. “Nigeria must make it easy for investors to predict what to expect when they come into the country with their investment.” Okechukwu Enelamah, minister for trade and investment, in his presentation on ‘Ease of Doing Business in Nigeria’ reiterated government’s commitment to making Nigeria an attractive business destination. “The objective we are looking at is how we can make life easier for people, remove the bottlenecks and roadblocks and things that get in the way of people running their businesses efficiently, but this will need a collective responsibility both from the government and the private sector,” he remarked. He revealed that the government had earmarked airport concessioning, single window ports operation, deployment of scanners, and communication system to promote efficiency in the ports as some of the priority for 2018. For Akinola Olawore, president of the chamber, there was a need to continually sustain relationship in building sustainable plan to enable a more business-friendly environment. He noted that the forum was created to design, highlight and also propose direction to ensure sustained economic ties between the UK and Nigeria. 70 manufacturers expected at Waste Water Technology expo ANGEL JAMES Ov e r 7 0 manufacturers and water packagers are expected at this year’s West Africa Waste Water Technology expo and exhibition (Elan Expo) billed to take place between July 10 and 12 this year. According to Jude Chime, project coordinator of Elan Expo Nigeria, the event promises to rally all stakeholders in the water and waste management sector to see how they can increase participation in the areas of water supply, distribution, sanitation, and recent technologies in the waste water sector. “Seventy manufacturers and investors from other parts of the world and West Africa are expected. Lagos State Water Corporation, which is a key stakeholder, will tell us about the experience of water supply in the state so that other states can learn from that,” Chime said. He said some stakeholders from different parts of the world are aware of the event already and some have confirmed attendance. “We have heard from the embassies and they are all willing to cooperate and participate in this exhibition. We also have strong support from institutions related to water like the Nigerian Institution of Mechanical Engineers, and others. This RAZAQ AYINLA, Abeokuta As a response to the complaints coming from investors and manufacturers that are based in Igbesa-Agbara as well as other industrial areas across the state, Ogun State government has requested investors and entrepreneurs to put down 30 percent cost, while government contributes 70percent to fix decaying infrastructure such as roads within industrial estate. The request was borne out complaints and criticisms from investors which were published by some national newspapers, including BusinessDay, on the need for government to quickly fix decaying roads and infrastructure in order to sustain the tempo at which industries expand and locate their factories and businesses to Ogun state in recent times. Speaking at 12th Quarterly meeting of MAN, Ogun State branch, with the state government in Abeokuta weekend, Bimbo Ashiru, commissioner for commerce and industry, said the level is an exhibition that can provide solutions for 2020. It is a continuous process until we get all the aspects in the water sector right,” Chime stated. Muminu Badmus, managing director of the Lagos Water Corporation, stated the expo is important as it is difficult to separate water from waste water. “It is from water you get the waste water. It will be an opportunity for us to learn, innovative ideas and equipment out there and see how we can incorporate them into the service we are providing locally. It is something we need to take advantage of. We would love to partner with them and provide field trip to some of our facilities.” “We have gone a long way, so it will be an opportunity to showcase what we have done. This expo is an opportunity to talk to investors so we can bridge the gap and supply more safe water. We will continue to do our best to ensure that by 2020, every household is connected to water,” Badmus said. The organisers say there has been a lot of support from many government ministries, including the Federal Ministry of Water Resources, which is also willing to support the event, adding that various states water corporations have been visited, including those in the south-west and about 10 in the northern part of the country. Ogun partners MAN to fix decaying infrastructure in Agbara, other industrial areas of decaying infrastructure, especially roads, is worrisome and there must be urgent and cogent solutions to this ugly scenario, which must be initiated by both investors and government. He said although efforts were ongoing to fix Atan-Igbesa-Agbara roads to Badagry end with concrete road solutions, compensations are being paid to those whose properties were demolished. He said the fact remains that investors and government should use public -private partnership arrangements to fix and find solutions to perceived challenges that could inhibit production and distribution of goods. Ashiru also disclosed that 304 companies and 225,000 enterprises had opened for business in the state in the last seven years and cogent efforts must be done to sustain the tempo at which industries establish in Ogun through the fixing of decaying infrastructure, harmonisation of multiple taxation, among other things, which could improve ease of doing business in the state.
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