Finance Minister, Dr, Mrs Ngozi Okonjo-Iweala
Stakeholders in the manufacturing sector of the nation’s economy have blamed government policies on importation of raw materials and high interest charges by banks in the country as the bane of manufacturers.
Speaking at a media visit to Nosak Distilleries Limited’s ethanol plant in Lagos, Chairman and Group Managing Director, Mr. Toni Ogunbor, said delay of export rebate has overtime discouraged local manufacturers from exporting finished goods abroad.
Stakeholders in the manufacturing sector of the nation’s economy have blamed government policies on importation of raw materials and high interest charges by banks in the country as the bane of manufacturers.
Speaking at a media visit to Nosak Distilleries Limited’s ethanol plant in Lagos, Chairman and Group Managing Director, Mr. Toni Ogunbor, said delay of export rebate has overtime discouraged local manufacturers from exporting finished goods abroad.
He stated that government should revisit interest subsidy, tax reform and export rebate as a deliberate effort to revive the ailing manufacturing sector.
Ogunbor called on the Federal Government to increase the sector’s intervention fund with the Bank of Industry (BOI), so as to reduce the burden of high charges by banks stressing that no enterprise could survive with interest charges as high as 20 per cent.
He also urged the government to reduce the tariff on imported raw material for ethanol production from 10 per cent to 5 per cent because of its importance to the health sector.
Ogunbor argued that collecting tariff on exported goods whose imported raw material has already attracted a tariff of as much as 10 per cent is illogical, stressing that government should expedite action at reviewing the process.
He decried a situation where brown sugar, a raw material for making sugar attracts 5 per cent tariff while processed raw material for making ethanol attracts as much as 10 per cent.
Ogunbor who disclosed that his company had invested a whopping N300 million in providing electricity said such an amount would have been deployed into ventures that will generate jobs opportunities for the teaming unemployed youths in the country.
According to him, “Infrastructural challenge is one of the major problems we are facing. Roads are bad, you provide electricity, you provide water and you are expected to pay multiple taxes. The road through the Apapa port is barely motorable and all imported processed raw material and vital equipments comes through that road. How do you survive this kind of environment?
“As we speak I can tell you authoritatively that many companies have closed shop and jobs are gone as a result. This is a country where one job takes care of several dependants. Government will always preach policies but if there are no committed citizens, the policies will not make headway. The only way the manufacturing sector can grow is for government to give incentives that will encourage more entrepreneurs to invest in this country.”
He further stated that the situation in the country encouraged traders to take advantage of manufacturers stressing that the result was the mass unemployment in the country.
He said: “ The average manufacturer do not make as much as a trader in this country. This is because a trader does not need to invest in infrastructure, all they need do is go to China and import ready made products and sell.
“This is why it is reasonable for government to do everything it can to support the private sector to grow this country’s economy. As a company, we are proud to be part of the efforts at moving this country forward. Beyond what we are doing here we are looking at the future already. Our plan is to invest $30 million in the agro-allied sector to enable us source our raw materials locally.”
Ogunbor who said he had invested over N5 billion in the plant said the investment enabled it to retain the leadership position in the industry.
“We have increased our daily production capacity to 250,000 litters per day from 100,000 litters. To maintain our position in the industry, we will commission our third plan in October this year and that will bring the daily combined production capacity to 540,000 litters, “he said.
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