Engineer Mansur Ahmed is the incumbent President of the Manufacturers Association of Nigeria (MAN). In this interview with Anozie Egole, he spoke extensively on the challenges the association is facing as well as on sundry issues affecting manufacturing and export.
“The more Nigerians consume made-in-Nigeria products, the more our market will expand and the more we can expand our operations and become more competitive”
How do you feel being elected recently as the 10th President of the association?
To me it is a honour and privilege to head this association, because I believe that our economy cannot grow impressively and provide the kind of life that citizens need without a strong productive sector and the manufacturing sector is in the heart of that. So we have every responsibility or a major responsibility to grow that sector. In many successful and emerging countries, the manufacturing sector contributes up to about 30% of the GDP of the country but our own manufacturing sector (I think) hardly contributes up to 10%, so clearly there is a huge gap that must be filled. And the only way we can fill that gap is to open up the economy, provide opportunities for investors to come and invest; particularly in the sector, develop policies and regulations that will assist and facilitate the sector to grow, particularly with regards to the use of locally and domestically grown inputs into the sector. Whether we are talking about raw materials, semi processed input or even manufactured inputs, it is important that the association grows by simply relying more on the resources already available in the country. And thank God Nigeria is rich in all these resources, we have a huge agricultural sector that can provide the necessary raw materials for a large number of manufacturing activities from food processing to pharmaceuticals, to industrial goods and all that.
So far, what can you say have been the challenges in the sector?
Manufacturing succeeds and grows on a strong market position and Nigeria has strong market and that is why today we are having a lot of problems with imports. Because the market is huge due to the large population and that is the reason the demand is high but the local production is low. So I think clearly this is an area that we in the sector must continue to work and push the federal government to introduce policies that will help the sector to use these local raw materials. And basically, there should be provision of adequate incentives for the local materials to be produced in the quantity required at the prices to make the manufacturing sector competitive, particularly with regards to imports.
Today, the trend in the global economy is for regional integration and expanded trade and counties have succeeded because they have exploited the opportunities of trade, via products and therefore generate foreign exchange. Unfortunately in Nigeria, the only foreign exchange that we depend on 90% is on the export of only one commodity which is crude oil. And that is why when the price goes up, we are happy when the price collapses we get into serious difficulty and foreign exchange availability simply becomes very volatile and for a country that depends on all sorts of imports it creates a double tragedy. You cannot rely on the foreign exchange and therefore your import capacity continues to fluctuate. So these are some of the challenges that the manufacturing sector faces.
What will be the policies and initiatives that MAN will pursue under your watch to address some of these challenges?
First, we do encourage the private sector to work effectively with the government to ensure that the government plays the role it should play to generate economic activities in the private sector. Government should be a strong facilitator, regulator and indeed a very strong formulator of activities or policies that will generate competitiveness in the sector. So there is advocacy for policies that are supportive of the manufacturing sector, policies that create more opportunities for our members, policies that limit the risk that our members take and therefore giving them the opportunity to exploit the opportunities they have. We will continue to explore this and pursue it vigorously and indeed this meeting today is a starting point because the Shippers’ Council is one of the major regulatory agencies of government and particularly a major focus on manufacturing activities, and also a major component of manufacturing activities in the area of imports of raw materials and export of finished goods and services. Secondly, as I said before, today, no economy can thrive except its manufacturing sector is competitive in terms of the cost, price, the way it operates and also its productivity. One of the issues that we will tackle is to continue to pursue competitiveness within the sector. So we will work with the government itself and the various agencies of the government that are involved in developing competitiveness in other to ensure that our members are becoming competitive. We will also within our self, ensure that we become more competitive, competitive in cost, price, quality, delivery and in service provision. And for this to happen particularly transport infrastructure is very vital and again we will continue to call on government to do more to modernize and expand the transport infrastructure in the country. Like the Executive Secretary of the Nigerian Shippers’ Council, has said- from the port infrastructure itself to the transport infrastructure in terms of rails, roads and waterways, we really need to strengthen the infrastructure. He also talked about making better use of the eastern ports. There will be need for the government to provide very strong incentives that will allow our importers especially raw material importers to operate the eastern seaport. But, that requires linking the ports with the various business hubs; otherwise you may import and spend more money tracking what you have imported.
You spoke on the issue of road infrastructure, how you think the issue of persistent gridlock on the ports access roads can be addressed?
First of all, we must agree that the government is now doing something, it’s a bit late but it has to be done and I think there is now some visible efforts on the part of the government to expand the area particularly the road network around the ports. But that really needs to be expedited, I think it is too slow, the work started about two years ago and it is going at a snail speed. I think we will like to see the work on the Apapa roads expedited but we also want it extended to Kirikiri and all that so that the cost of transporting both in an out of the ports will be significantly reduced. As we noted earlier that the cost of transportation in the manufacturing sector is between 30% to 40% and there is no country in the world that can be competitive with the type of cost particularly the transport sector. So that has to be worked on and I believe that there is visible effort by the government to work on that and also the development of the rail system, expansion of roads we will like to see that expedited as quickly as possible.
How do you intend to promote made-in-Nigeria products?
This is a major focus of the advocacy and the policy of the association, clearly the more Nigerians consume made in Nigeria products, the more our market will expand and the more we can expand our operations and become more competitive. And we are working in this regards with other partners for instance the Raw Materials Development Council, the Local Content Development and Management Board and other stakeholders to promote more made-in-Nigeria products and it is important that our trade policies do take account of this so that we will be able to produce the amount of the product we need. I am very excited that this is an issue that will be very critical especially as we begin to confront the prospects of this African Continent of Free Trade Agreement (AfCFTA). Because we want to make sure that every opportunity for all manufacturers to export is taken. And that means if you know, one of the key requirements or condition is through the rule of origin which states that if you are going to participate in this arrangement, there must be a clear justification that this product was indeed produced in an African country. And since we have the advantage of large market and also well-advanced manufacturing sector, most people don’t realize that the Nigerian manufacturing sector is one of the best in the African region. And so we should take advantage of this and also to promote export but to do that we also have to make sure that the local environment is competitive and the regulations and rules are all supportive and also we maximize the use of local materials. And I think part of the things you see when you came was that you can’t give what you don’t have, so using local products is extremely very important.
Talking about the AfCFTA, why is Nigeria foot-dragging?
I think the trade liberalization in ECOWAS has not worked successfully for three reasons. Firstly, I think there were no sufficient consultations and collaborations between the various stakeholders and with government and to a large extent, some of these agreements were signed without full consultations and full understanding of the key issues. Secondly, obviously, the agreement has suffered tremendously largely because Nigerian manufacturers that have tried to export their products within the regions have complained bitterly that the transit countries are not complying with the ECOWAS trade liberalization arrangement. So that is why it is so important that when we go into the continental trade agreement we recognize that it is not just signing an agreement, but making sure that the terms of the agreement are complied with by all the parties and particularly by all governments.
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