Posted on April 27, 2018
The automotive industry, pulp and paper publishing industry and others declined by over 44 per cent in 2017, the Manufacturers Association of Nigeria said.
The manufacturing sector as a whole went into recession in the third quarter of 2017 after witnessing a slight recovery in the first quarter.
But the National Bureau of Statistics in its full year 2017 report of the manufacturing sector indicated that the manufacturing sector grew slightly by 0.14 per cent from -2.85 per cent in Q3 2017 and -2.54 per cent in Q4 2016.
A further breakdown of the performance of activities in the sector by MAN showed that food, beverage and tobacco grew by 57.1 per cent; textile, apparel and footwear grew by 60.02 per cent; wood and wood products by 55.5 per cent; chemical and pharmaceutical grew by 57.9 per cent; domestic/industrial plastic and rubber grew by 63 per cent; electrical and electronics grew by 55.6 per cent; with iron, metal and steel growing by 59.2 per cent.
Sectors that witnessed decline are pulp, paper and publishing, which declined by 39.5 per cent; non-metallic products -45.3 per cent and motor vehicle and miscellaneous assembly, which dropped by 48.8 per cent.
The Director, Economic and Statistics Department, MAN, Mr. Segun Osidipe, noted that 2017 and the beginning of 2018 presented mixed fortunes for the sector, adding that while some grew, others had continued to struggle.
Experts have however said that the decline in the growth of these sectors is attributable to the lack of local content, poor infrastructure, among others.
According to the Director-General, Lagos Chamber of Commerce and Industry, Mr. Muda Yusuf, the major challenge of the paper publishing industry is the high operating cost stemming from imported raw materials.
He said that in addition to the cost, there was diminishing patronage as most people could read content online.
He said the patronage in the educational sector using a lot of the printed paper was getting weaker.
He suggested interventions by the government to remedy the situation as well as reviving the ‘dead’ paper mills in the country to make available raw materials locally.
For the automotive sector, the government in 2013 established the National Automotive Industry Policy aimed at increasing the number of local vehicle assembly plants.
With the policy came increase in tariff on imported cars and the ban on importation of used vehicles through the land border.
Critics of the policy have noted that rather than aid the growth of the industry, it is limiting revenue generation to the government as ports in neighbouring countries where tariffs are lower now benefit.
The policy, they maintained, had not stopped smuggling of vehicles into the country since vehicles assembled locally were too expensive for average Nigerians.
A senior lecturer at the Covenant University, Ota, Ogun State, Dr. Oscar Odiboh, expressed worry over the state of the industry, lamenting that the industry could collapse unless the government and stakeholders in the sector came up new measures that would favour the nation and the people.
According to him, the economic downturn, uncertainties and government inaction have crippled the growth of the industry despite concerted efforts to turn the country to a vehicle manufacturing nation.