INDUSTRIAL CAPACITY UTILIZATION MAY TUMBLE THIS YEAR - OPS
M embers of the Organized Private Sector (OPS) under the aegis of the Manufacturers Association of Nigeria (MAN) and the National Association of Small Scale Industrialists (NASSI) have predicted that capacity utilization of the manufacturing sector may fall drastically this year.
In two separate interviews with Daily Sun in Lagos yesterday, MAN and NASSI expressed disappointment on the parlous state of infrastructure in the country, submitting that infrastructure growth and development which is to drive capacity utilization on an upward trend remained a missing link. Specifically, the Chairman, Infrastructure Committee of MAN, Mr. Reginlad Odiah, argued that capacity utilization in the manufacturing sector cannot witness significant growth because nothing has really changed over the years.
According to statistics released by MAN late last year, capacity utilization stood at 42.5 percent, a figure described by stakeholders as grossly abysmal to move the manufacturing sector forward. Indeed, the Chairman of NASSI, Lagos Chapter, Mr. Tayo Kuti -George posited that the recent withdrawal of fuel subsidy has further dealt a debilitating blow on the real sector as a result of increased cost of production, which, he said, cannot be passed onto the customers and is further capable of affecting capacity utilization as a result of low production occasioned by less demand.
Besides, he said government has not really provided the enabling environment for manufacturers to produce and employ more as a result of the high level of insecurity in the country, which has thus forced many operators to scale down their level of production. Also, the NASSI Chief said the proceeds from subsidy withdrawal, which government has promised to invest in power and other areas of infrastructure is a medium to long term expected result, adding that, what manufacturers need from governments at the moment is an urgent intervention move to save the sector from imminent collapse.
Though Odiah was quick to admit that as a step towards the realization of infrastructure development, government, he said, is now more open and transparent with its policies by subjecting it to debates and scrutiny by stakeholders, adding that, this is not enough to bring about the needed change, unless the implementation of such policies are strictly adhered to.