Financial Information Platform

Manufacturers task FG to fasten AfCFTA implementation, tackle FX supply issues

0 4

The Manufacturers Association of Nigeria (MAN) has called on the Federal Government to urgently fast track the implementation process of the African Continental Free Trade Agreement (AfCFTA) and open up the economy to attract foreign investment.

Free trade allows countries to specialize in the production of goods and services for which they have a comparative advantage. By specializing, nations can produce more, higher quality products and focus on the most efficient uses of their resources. The increased output and rising living standards that result from specialization through free trade clearly benefit consumers in both trading nations.

Many people fear that free trade will cause job losses in the industries that compete with cheap foreign imports, such as textiles and clothing, but this is offset by the need for more workers to transport, distribute and sell imported goods. If tariffs are reduced or eliminated across all sectors of an economy, even those protected by high tariffs do not suffer significant job losses because their workers have been protected from competition with low-wage foreign labor markets.

MAN Director General, Segun Ajayi-Kadir said this during a webinar organised by the association to enable its members make informed decisions regarding the initiative and other business issues in the country.

The Director General of Manufacturers Association of Nigeria, Segun Ajayi-Kadir, tasked the federal government to fasten the implementation of African Continental Free Trade Area (AfCFTA) and to tackle foreign exchange supply issues in a webinar organised by the association.

During the webinar which was held on June 18th, 2020, both manufacturers and members of MAN were given an opportunity to ask questions that would enable them to make informed decisions regarding the trade initiative.

Ajayi-Kadir said that the AfCFTA should be implemented as soon as possible while also tackling foreign exchange supply issues in order for manufacturers to take advantage of it. He added that although COVID-19 had disrupted global commerce and international trade, Nigeria still has a lot going for it as it is currently Africa’s biggest economy and third largest market.

He also urged the government to tackle Foreign Exchange supply issues, saying it had become critical for manufacturers given their low volumes production and declining sales due to the COVID-19 pandemic.

He also urged the government to tackle Foreign Exchange supply issues, saying it had become critical for manufacturers given their low volumes production and declining sales due to the COVID-19 pandemic.

“The poor supply of foreign exchange is a major challenge to our industry, as raw materials such as steel, chemicals and components are sourced from over 100 countries worldwide. The continued closure of land borders has worsened the situation for our members who need unprocessed materials for their operations.

“Also, we urge the government to look into how best they can support manufacturers by providing cheap loans at single-digit interest rates, with flexible repayment periods. This will enable them to sustain their businesses in this challenging period.

“The key issue is now how do we get FX. We’ve got to figure out how we can work with government because if government does not give us FX we will not be able to export our products. This is what has been going on for years,” Kadir said.

As FX supply remains a critical issue for manufacturers, Ogunye added that the situation was not only affecting manufacturers but also the whole country.

“We are all in the same boat together. We need to look at how we can get this economy to work again because, as you know, there is no industry that does not affect manufacturing. So it’s very important that we all sit down and figure out what needs to be done so that we can start operating at full capacity again,” he said.

He also noted that some manufacturers who used letters of credit to import raw materials were experiencing challenges in accessing the dollars needed to complete payments for those raw materials.

Leave A Reply

Your email address will not be published.