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CBN Must Review 41 Items Restricted From FX Market

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The Organised Private Sector, OPS, yesterday, insisted that the Central Bank of Nigeria, CBN, must review its policy on the 41 items restricted from official foreign exchange market.

According to the group, the decision is hurting the manufacturing sector in such a way that could no longer be ignored, having led to the closure of many companies and relocation of others from Nigeria to Ghana and other neighbouring countries. It has also led to the refusal to repatriate over $10 billion held offshore by Nigerian businesses. These views were expressed by the Manufacturers Association of Nigeria, MAN; National Association of Small and Medium Enterprises, NASME, and the Lagos Chamber of Commerce and Industries, LCCI, at a ‘Stakeholders’ Dialogue on the Manufacturing Sector in Nigeria’, organised by NOIPolls and the Centre for the Study of the Economics of Africa, CSEA, in Abuja.

Generally, MAN, NASME, LCCI and NOIPolls stated that about 272 manufactures are either ailing or have closed shop over the last couple of months, while thousands of jobs are being cut on a daily basis.

According to Mr. Vincent Nwani, Director, Research and Advocacy, Lagos Chamber of Commerce and Industry (LCCI), the CBN announced the 41-item list without consulting the sector and that the chamber has made several representations to the apex bank without the desired results.

“We did press releases; we did stakeholders engagement; we engaged with the CBN at all levels, at least three times; we met the directors twice–up to the CBN Governors on this same matter of the 41 items- giving them examples of product-by-product. There must be an urgent review of the CBN’s policy on the restriction of access to foreign exchange placed on 41 items, as about16 of the total items in the list, serve as critical raw materials for intermediate goods produced in Nigeria, especially as the country lacks the capacity for optimal production of the items.”

Specifically, he said the ban on oil palm has led to the loss of about 100,000 jobs over the last couple of months, with major blue chip companies in Nigeria relocating to neighbouring countries; while the ban on glass and glassware has led to the loss of 80,000 jobs mainly in the pharmaceutical industry, as companies in this sector now find it difficult to package their products.

He said: “Local production of oil palm is put at about 600 metric tonnes annually, but the total demand of the country is put at about 1.8 million metric tonnes. Today, Presco Oil has orders of up to December 2017 to fill, it is presently hard pressed with demands. Listing oil palms among the restricted items meant that we have a shortfall of about 1.2 million metric tonnes.

“Some of the items placed on the restriction list by the CBN should be reinstated until the country develops the capacity to produce them locally. Some of the items need a period of between three and seven years for the country to develop self-sufficiency in their production. For instance, it takes a minimum of five years for oil palm to be planted and for harvest. The CBN should have given us more time. The manufacturing and industrial sectors lost about N1.4 trillion as a result of foreign issues, while about 780 raw materials needed by the sector were affected by the restrictions placed by the CBN.

“I have talked about palm oil, I have talked about glass and glassware, I have talked about rubber and rubber ware. Glass and glassware, rubber and rubber wares you need about a 3 year gestation period. The palm oil, we need 5 years gestation period before we can have the local capacity to be able to supply the 1.2 million metric tons that is in deficit as we speak. I will not be able to remember all the items off hand but we have the list and I can simply make it available.

“We have sent it to CBN before, they put up resistance about it and we are ready to send it again. You know the challenge the organized private sector had initially was that we were not able to understand the magnitude of this challenge.

“We are making this demand on the basis that we don’t have local capacity for the affected items on the list. Even if we are having scarcity of foreign exchange some of these lists need to be supplied and because of that, few of our members who have been able to earn export credit or export income in dollars have refused to bring it in or repatriate it. We have about $ 10 billion stuck in one country or the other earned by our members. Some of them are not manufacturers; some are agriculturists or merchants of different products. They cannot bring it in because the business confidence, the manufacturing confidence, industrial confidence is negative.

“Until we do something to boost this confidence all of this money will be stocked abroad. Even Nigerians that are living in the Diaspora that was able to bring in $ 23 billion in 2013. Last year we saw about 5 billion dollars, this year it is going to be less than 3 billion dollars. This is what negative confidence can do to an economy.”

Speaking in the same vein, Executive Secretary of NASME, Mr. Eke Ubiji, stated that recently, about 222 of its members have either collapsed or are ailing, while he blamed lack of access to credit, foreign exchange challenges, high interest rate, multiple taxation and poor infrastructure, among others, for their woes.

MAN

Also speaking, Mr. Ambrose Oruche, Director, Economics and Statistics of the Manufactures Association of Nigeria, MAN, lamented that the unavailability of productive inputs is the major challenge confronting manufacturers, stating that this was as a result of the restriction placed by the CBN on certain items.
According to him, the current operating environment in the country is harsh for many manufacturers to continue to operate, disclosing that some economic policies churned out by the Federal Government and the CBN are conflicting and are retarding the growth of the manufacturing sector.

He argued that the manufacturers were not consulted by the CBN and other regulators before the restrictions were placed on the items, noting that many of the products under foreign exchange restrictions are raw materials needed by manufacturers.

He said, “Presently, about 50 manufacturers have closed shop, while some have downsized.

Some manufacturers are still producing due to their love for this country. Government policy on cement should have adopted in this case.

“In the case of cement, Nigeria used to be a net importer of cement, but the government set up a policy over a five-year period, which made it possible for us to be a net exporter of the commodity.”

MPR

Mr. Oruche further faulted the decision of the CBN to increase the Monetary Policy Rate, MPR, to 14 per cent, stating that it has made it difficult for manufacturers to access funds to finance t heir operations. According to him, the fact that the economy is technically in recession, the CBN’s effort should have been directed towards expanding the economy rather than contracting it.

He also listed high interest rates, poor patronage of local manufactured products, poor supporting infrastructure, such as poor power supply, policy somersault and policy inconsistency, among others, as the challenges confronting manufacturers. To address the declining fortunes of the manufacturers, Mr. Oruche called for the resuscitation of domestic refining, as this would ensure that certain chemicals imported into the country, can now be sourced locally.

He also stated that attention should be paid to developing the infrastructure base of the economy and also on energy generation and distribution, while the Federal Government should also grant incentives and concessions to businesses.

The Chief Executive Officer of NOIPolls, Mr. Bell Ihua, said that the organization’s survey covered all six geopolitical zones of the country and that urgent actions were needed by the federal government to save the sector.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

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Ellah Lakes Partner Ondo State Government to Develop Oil Palm, Cassava in the State

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The management of Ellah Lakes Plc said it has partnered with Ondo State Government to develop and manage 5000 hectares of land for the purpose of cultivating oil palm and cassava in Ondo State, Nigeria.

The company stated in a statement signed by Kenechi Ezezika, Company Secretary, Ellah Lakes Plc.

Speaking on the development, the Chief Executive Officer, Chuka Mordi said: “This is a significant landmark for the Company in the development of our landbank, & we are very excited to be working with ODSG.

I am delighted that we are fulfilling our strategic objective of progressively expanding our land bank & diversifying our portfolio and production base. I am also glad to say that the intercropping programme in Edo State is progressing steadily & we have achieved our first milestone of 100Hectares of Cassava with the participation of personnel of the Agricultural Development Program (ADP), in Edo State”.

The Special Adviser on Development & Investment to the Ondo State Governor/ Chief Executive Officer of Ondo State Development and Investment Promotion Agency (ONDIPA), Mr. Akinboye Oyewumi, who also spoke on the development said: “We are pleased with this collaboration with Ellah Lakes Plc., and we look forward to a mutually beneficial, valuable and fruitful venture.”

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Unilever Nigeria Appoints Mr Jaime Aguilera as a Non-Executive Director

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Unilever Nigeria Plc

Unilever Nigeria Plc announced it has appointed Mr. Jaime Aguilera as a Non-Executive Director of the company effective from January 2021.

The company stated in a statement filed with the Nigerian Stock Exchange.

Mr Jaime Aguilera worked with Coca-cola, Nestle and Procter & Gamble before joining Unilever as Executive Vice President Unilever Eastern Europe in September 2016.

Therefore, his experience spans from Europe, Americas and Asia.

His key expertise areas are “in Sales & Marketing and he has lead teams in Spain, Brazil, South Eastern Europe, Middle East, Mexico and Global teams.

“In 2009, he joined Unilever Spain as EVP & Chairman and then moved to his current role as Unilever Executive Vice President Africa, leading the Unilever business in Africa. Jaime is of Spanish origin and is an alumnus of the Universidad Pontificia de Comillas- ICADE. Jaime majored in Economic Sciences, Management & Business Administration.”

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MTN Nigeria, Gameloft Partner to Increase Access to Variety of Exciting Games

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MTN Nigeria announced it has partnered with Gameloft, a leader in the development and publishing of games, to increase access to a variety of fun and exciting games online.

The telecommunications giant in collaboration with its new partner, Gameloft announced the launch of MTN Gameworld, a new gaming platform for its subscribers.

According to MTN, the new platform will allow the Nigerian growing gaming community access to a lot of unique games online through an extensive premium catalogue from Gameloft and other renowned publishers.

Commenting on the partnership, Srinivas Rao, the Chief Digital Officer, MTN Nigeria, said, “We are constantly seeking to deliver innovative products that support the aspirations of our customers, whilst delivering superior user experience. This partnership allows us to provide our customers with access to a variety of exhilarating games from Gameloft and other leading publishers at an affordable rate.”

MTN Gameworld will allow subscribed customers access to a variety of games, which they can play at subsidised data rates through the MTN Gameworld app. Android, iOS and Windows phone users can subscribe via SMS, app, web, USSD menu (*447#), 131 USSD menu and any other MTN customer channel.

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