Nigeria’s Manufacturers Call for Equal Level Playing Field on Electricity Tariffs

Nigeria’s manufacturers have expressed concerns over the disparity in the cost of electricity tariff across the Nigerian states.

The President of the Manufacturers Association of Nigeria, Mansur Ahmed stated in a statement released on Friday.

He said the difference in electricity tariff favours some parts of the country than the other.

According to him, the difference in some cases is around 25 percent, leading to unfair competition among manufacturers.

“…most worrisome is the fact that manufacturers who are made to pay higher tariffs sell their products in the same market and cannot afford resultant effects of wider gap in the prices of products as competitors in the industry,” MAN president said.

Therefore, the association called on the Federal Government to regularise the disparity in the cost of electricity tariff across various states of the nation.  This, Ahmed said has compelled some manufacturers under DisCos with higher tariff rates to sell at a loss in order to compete with the counterparts for market shares.

He, however, warned that if action was not taken urgently to address this cost differential, the affected manufacturers might start shutting down operations, a situation that could escalate the nation’s unemployment above 27.1 percent.

Ahmed also noted that electricity inadequacy is one of the major challenges hurting the competitiveness of the manufacturing sector in Nigeria.

He said manufacturers spent over 40 percent of their production overhead on electricity. This, he said was the reason the cost of operation and prices of made-in-Nigeria goods are generally higher when compared with prices of similar products from other nations.

“MAN therefore seizes this opportunity to commend the efforts of the Federal Government aimed at sustaining economic growth and the development of the manufacturing sector in Nigeria particularly the ongoing efforts at improving the quality of reliable and sustainable electricity supply in the country,” the statement read.