Members of the Organised Private Sector (OPS) have described as unprecedented, the institution and implementation of some economic policies of the Federal Government which have helped in reviving the hitherto moribund manufacturing sector of the economy.
They said that the commitment to the effective implementation of the policies has led to phenomenal increase in the local production of commodities which before now are imported into the country.
For instance, the manufacturers ascribed the success so far recorded in the cement sector to the investor friendly policies of the government as contained in the national cement production, which it said encourages local production not only to meet domestic demands but also for export.
The group under the auspices of the Manufacturer Association of Nigeria (MAN) gave kudos to the government of President Goodluck Jonathan for putting in place some broad based incentives generally geared towards reviving the moribund manufacturing sector, encourage industrialization and create jobs.
MAN in a statement signed by it President, Kola Jamodu said that government’s incentive policy, which is designed to encourage industrialization, has been effective as it has been encouraging new investments and creating jobs and now benefitting the larger economy.
Jamodu also commended the government for agreeing to the broad base incentives for the manufacturing sector instead of narrowing them, adding that “an important reform in the incentive policy, as sought by MAN, was to broad base the incentives to a whole sector rather than issuing discretionary waivers for individual firms. This has brought transparency in the policy and created a level playing field for all players.
“There is a clear evidence of the positive impact of the sector based incentives. Incentives and concessions given to the Cement industry have contributed to the phenomenal increase in national cement production from less than two million tons in 2002 to over 20 million tons in 2013. As a result, from being a net importer, Nigeria has become a net exporter of cement. This was achieved in less than a decade thanks to the enabling environment fostered by government policies.”
According to him, the incentive policy has been in place through several administrations but the President and his Economic Management Team deserve credit for streamlining the policy to leverage it for attracting investment in the priority sectors.
Jamodu added that special intervention funds of the Central Bank of Nigeria (CBN) disbursed through the Bank of Industry (BOI) have also helped revive a good number of ailing industries and SME’s. Incentives are also helping to boost trade and investment in the non-oil sector and generating employment in agro-allied industries.
Explaining how the incentives are impacting positively on manufacturing and the economy, he said, “Incentives are needed to generate investment in the productive sector – manufacturing and agriculture. Waiver of customs duty and VAT on import of plant and machinery is required to make our industries competitive. Duty and VAT exemption on equipment used in gas production has contributed to reduction in gas flaring and growth in gas-to-power initiative aimed at boosting power supply.”
Meanwhile, the OPS leader decried the cost of doing business in Nigeria which he said remains very high noting that due to the prevailing infrastructural disincentives, companies have to generate own captive power and build surrounding facilities.
He pointed out that incentives and waivers are required not only to attract investments but to also compensate for the public infrastructure-deficit. “Most developing companies give incentives to attract investment in priority sectors where they have a comparative advantage and Nigeria cannot be an exception”, the MAN boss argued.
MAN equally affirmed its support for the implementation of the recently launched Nigerian Industrial Revolution Plan and called on well-meaning Nigerians to be prepared to make their positive contributions to ensuring the success of the programme.