A survey carried out by the Manufacturers Association of Nigeria (MAN) covering manufacturing activities in the first quarter of 2019 (Q1’19), has revealed that the sector was stressed further, even as the confidence level of operators was low, though with high expectation of improvement down the year.
Manufacturers’ CEOs Confidence Index (MCCI), a quarterly survey of CEOs of MAN member-companies across the six geo-political zones of the country and the ten Sectoral Groups of the association, was designed to measure the pulse of the manufacturing sector.
In the report made available yesterday, MAN stated: “The aggregate MCCI for Q1’19 stood at 51.3 points which is slightly above the 50 points benchmarks of good performance. A performance which substantiated the need to pay attention to myriads of operating challenges hindering the sustenance of growth of the sector despite numerous policies designed to incentivize real sector of the economy.
“The indexes of Current Business Condition (45.5 points) and Current Employment Condition (38 points) were not very encouraging owing to the inability of manufacturers to operate at close to full capacity. “However, based on the responses of manufacturers, indexes of Business Condition in the next ‘3’ months (54.5 points); Employment condition in the next ‘3’ months (52.5 points); and Production Level in the next ‘3’ months (65.5 points) suggests that manufacturing CEOs have confidence that the operating environment will improve, leading to increase in manufacturing employment and production level in the second quarter of the year.”
Responses from the CEOs revealed a number of challenges confronting the sector which ranked power supply and cost of energy first, closely followed by multiple taxations and over regulations; High interest rate/Difficult condition in accessing loans in Nigeria and Poor accessibility to ports/Gridlock at the national ports/High Demurrages; Poor economic infrastructure/Bad roads/Poor rail transport systems and; Difficulty in sourcing Forex/Multiple Forex widows/No Special treatment of manufacturers in sourcing Forex.
The data presented in the report, according to MAN, was generated from responses of over 200 CEOs of MAN member-companies across the country focusing on their positions on macroeconomic and business operating environments as well as perception on the earlier mentioned diffusion factors. MAN said the MCCI Q1’19 is the maiden edition that took into account manufacturers’ perception on a set of factors which include: Current Business Condition, Business Condition for the next three months, Current Employment Condition, Rate of Employment, Employment Condition for the next three months and Production Level for the next three months.