The COVID-19 pandemic has caused a sharp decline on investments in the manufacturing sector, a survey from the Manufacturers Association of Nigeria (MAN) has revealed.
MAN CEOs Confidence Index (MCCI) for the first quarter 2020 showed an MCCI of 44.4 points representing a significant decline from 51.9 points recorded in the Fourth Quarter of 2019.
This according to the survey, shows that manufacturing performance was dismal as the index fell below the 50 points benchmarks for the first time since the first edition of the report which was published in 2019.
“The pandemic has left no stone unturned in the manufacturing sector as investment recorded a sharp decline. A massive 75 percent of CEOs interviewed (50 percent declining and 25 percent severely declining) reported decline in investment on account of this pandemic and largely on the associated anxiety and uncertainty surrounding the global and national economic dynamics.
“Volume of production being a twin component also revealed a massive decline as 86 percent of CEOs interviewed (54 percent declining and 32 percent severely declining) reported decline in production volume on account of this pandemic.
“Thus, confirming that the pandemic has negatively affected both the demand and supply side of the economy. The reason for an effective collaborative framework for Government and Private Sector operators to rub minds on suitable stimulus packages that would enable the manufacturing sector ramp-up production to effectively meet domestic consumption requirements and in readiness for export.”
The manufacturers’ recommendations include; “a state of emergency in the manufacturing sector of Nigeria in order to be acquainted with the status of the sector and craft strategies for quick recovery backed with sustainable stimulus packages.
The report also added that “the government should establish a special bailout fund for the manufacturing sector with set deliverables on the number of jobs to be created, the volume of export, quantum of locally raw materials utilized and projected revenue.
“Grant manufacturers waivers from all demurrage payable between February and July 2020, especially those occasioned by the lockdown directives of Government and others associated with COVID-19 pandemic.
“Fastrack the provision of basic infrastructure, especially accessible road network and functional rail networks along the corridor of vital domestic trade hubs for raw materials, finished products and export routes.”
It also called on the government to support the manufacturing sector to guarantee its continuous survival by considering recommendations contained in the report.