The Nation Newspaper

Category: Industry

Push for policy ventilator to salvage manufacturing

The manufacturing sector is in a precarious state. No thanks to losses inflicted on operators by the COVID-19 pandemic. To salvage the sector, manufacturers are pushing for a declaration of a state of emergenc to place the sector on an integrated policy ventilator, through the provision of comprehensive support systems and stimulus packages to return the sector to the path of growth. Assistant Editor CHIKODI OKEREOCHA reports.

The manufacturing sector is severely battered. It is gasping for breath following the the coronavirus (COVID-19) pandemic ravaging the world and the containment measures put in place to halt its spread, which have inflicted incalculable losses on manufacturers.

And with the attendant precarious state of the sector, nothing will, perhaps, gladden the hearts of manufacturers than for the government to, among others, declare a state of emergency in the sector.

This, according to them, will place the sector on what they described as “an integrated policy ventilator”, through the provision of comprehensive support systems and stimulus packages to return the sector to the path of sustained production.

They pointed out that the extension of a holistic stimulus to manufacturers would minimise manufacturers’ losses, particularly, the sub-sectors that could not operate because of the lockdown.

The manufacturers added that a lifeline would facilitate quick resumption of full post-COVID-19 lockdown manufacturing and enhance the contribution to the Gross Domestic Product (GDP).

They emphasised that declaring a state of emergency in the sector would help acquaint policy makers with the sector’s status so they could craft strategies for quick recovery backed with sustainable stimulus packages.

The manufacturers’push for a policy ventilator in the form of a state of emergency to salvage the sector was contained in the first quarter Manufacturers Association of Nigeria (MAN) Chief Executive Officers (CEOs) Confidence Index (MCCI) released over the weekend.

The MCCI was created by the MAN as a quarterly instrument for measuring changes in macroeconomic trends, operating environment and selected diffusion factors relevant to the sector.

CEOs of manufacturing concerns are the respondents to MCCI survey, and the index seeks to measure their pulse on the economy to ascertain their level of confidence in the prevailing economic policies, regulatory guidelines and manufacturing operating environment in Nigeria.

The first quarter 2020 MAN CEOs Confidence Index (MCCI) is the fifth of the publication. And it was restructured to accommodate exigent developments in the quarter, particularly the effect of the pandemic on the sector.

CEOs of manufacturing concerns said fundamentally, the first quarter 2020 MCCI aggregate Index and the indexes of the various diffusion factors fell below the 50 points benchmark. “The first quarter of 2020 presented an MCCI of 44.4 points, representing a significant decline from 51.9 points recorded in the fourth quarter of 2019.

“Most disturbing is the fact that manufacturing performance was dismal as the index fell below the 50 points benchmarks for the first time since the first edition of this report was published in 2019,” the CEOs said. They attributed this to the lull in the economy; absence of synthesised fiscal and monetary policies.

Others are poor performance of key macro-economic fundamentals; the ever-increasing cost of production occasioned by unfriendly operating environment; heavy disruptions in the global value chain triggered by the trade war between two leading economies and the outbreak of COVID-19.

The outbreak of the Covid-19 pandemic in Wuhan, Central China, last December, and its subsequent spread across continents from mainland China, its roots, to Asia, Europe, America and Africa, including Nigeria, caused unprecedented disruption in business, economic and financial activities.

Since February 27, last year, when the deadly virus found its way into Nigeria, manufacturers have been thrown into confusion. Containment measures put in place by the Federal and state government to halt the spread of the ,including partial and total lockdown across the country forced a shutdown of many manufacturing concerns.

Why manufacturers are hurting

The Director-General, Lagos Chamber of Commerce and Industry (LCCI), Mr. Muda Yusuf, who captured the plight of manufacturers, said: “Many manufacturers and service providers in the country are experiencing acute shortage of raw materials and intermediate input.

“This has implications for capacity utilisation, employment generation (and retention) and adequacy of products’ supply to the domestic market. There is also an implication for inflation and the pressures are mounting.”

As the LCCI chief explained, the global supply chain has been deeply disrupted as China, which is the second largest economy in the world, is a major supplier of inputs for manufacturing firms around the world, Nigeria inclusive.

Indeed, more than 70 per cent of manufactured goods in Nigeria are said to be imported, with China representing Nigeria’s biggest trading partner, with about 19 per cent of its imports sourced from the Asian giant.

Other reliefs sought by manufacturers

As part of the stimulus packages being canvassed by manufacturers under the proposed state of emergency to return the sector to the path of sustained production, manufacturers specifically called for the establishment of a special bailout fund for the sector.

This, according to them, will come with set deliverables on the number of jobs to be created, the volume of export, quantum of local raw materials utilised and projected revenue.

It wasn’t the first time manufacturers called for one form of financial lifeline or the other. Before the release of the findings of the MCCI over the weekend, MAN President, Mansur Ahmed had called on the Central Bank of Nigeria (CBN) to extend its financial support to the supply of Foreign Exchange (forex) to the manufacturing sector at pre-COVID-19 rates.

Ahmed, in a statement made available to The Nation, said as part of the Federal Government’s efforts to mitigate the impacts of the pandemic on the economy, the CBN should also consider directing commercial banks to freeze interest charges in view of a lock down.

The MAN chief also urged government to consider the introduction of fiscal measures, such as waivers on import duties on Active Pharmaceutical Ingredients (APIs), and other essential products; and extend tax holiday to firms on corporate tax.

He also wants the government to waive the Value Added Tax (VAT); reduce the burden of personal income tax to increase the disposable income of an average worker.

Manufacturers are also requesting a reduction of the financial pressure on firms occasioned by COVID-19 by compensating manufacturing concerns that are forced to shut with 60 per cent of employees’ salaries for at least three months. This, according to them, will prevent the layoff of workers.

With the gradual easing of the lockdown, manufacturers have also urged the government to support manufacturing concerns with existing loan facilities by reviewing the terms, especially reducing interest rates to five per cent with two years moratorium.

“For manufacturers that are investing in order to scale up production, they should be granted loans at five per cent interest rate for a period of five to seven years. This measure will, no doubt, improve liquidity and ramp up productivity in the manufacturing sector in a manner that will cover up for obvious losses due to COVID-19,” MAN CEOs said.

May 14, 2020
How to avert post COVID-19 food crisis

Even before the first phase of the easing of the lockdown to contain the spread of the Covid-19 pandemic began on Monday, the twin shocks of the scourge and sharp fall in oil prices had set the stage for an imminent food crisis. While the containment measures against the pandemic affected domestic food supply chains by constraining farmers, tumbling crude oil prices worsened the nation’s fiscal woes. Now, Nigerians are in for a long-drawn battle with food insecurity. Assistant Editor CHIKODI OKEREOCHA reports.

A strategy to ensure that the impact of the coronavirus (Covid-19) pandemic on this year’s farming season is minimised is being worked out. Indication to this emerged penultimate week when President Muhammadu Buhari, as part of the government’s response, directed the setting up of an ad-hoc committee “to ensure the impact of this pandemic on our 2020 farming season is minimised.”

To make this happen, the president, who conveyed this response via his April 13 address announcing the extension of the Covid-19 pandemic lockdown, directed the Minister of Agriculture and Rural Development, the National Security Adviser, the Vice Chairman, National Food Security Council and the Chairman, Presidential Fertiliser Initiative to work with the Presidential Task Force on COVID-19.

Buhari also went a notch higher, informing Nigerians that to ensure the economy adapts to the new reality forced by the pandemic, the Ministers of Industry, Trade and Investment, Communication and Digital Economy, Science and Technology, Transportation, Aviation, Interior, Health, Works and Housing, Labour and Employment and Education have been directed to develop a comprehensive policy for a “Nigerian economy functioning with Covid-19”.

However, while these interventions are necessary, timely and highly commendable, some policy analysts and agricultural experts are doubtful if they can halt the contraction of agricultural production in this year’s farming season and even next year, let alone help position Nigeria to become a self-sufficient food producer post-Covid-19.

They argue, for instance, that the policy responses were belated; that the dislocation of the agricultural production and food supply chain caused by containment measures against Covid-19 would probably not have been this devastating if the authorities had heeded earlier calls to match increasing population growth rate with enough food production.

The rampaging virus was first identified last December, in Wuhan, Central China. The pandemic eventually found its way into Nigeria on February 27. But, before then, the United Nations (UN) had projected that Nigeria, with an estimated 200 million population, will hit 400 million by 2050.

The UN said at the 3.2 per cent population growth rate, Africa’s largest and most populous nation will overtake United States by 2050. Expectedly, the projection jolted experts from diverse sectors hence they renewed their call on the authorities, working with operators in the agricultural sector, to boost food production to ward off the unsavoury consequences of food insecurity and poverty.

Unfortunately, their wise counsel failed to hit the right chord in the ears of the economic managers, especially those in the agric sector. They obviously did not see the need to address the myriad challenges facing agricultural productivity, such as insufficient farm mechanisation, and lack of electricity supply to support value addition and prolonged shelf life of perishable produce.

Others issues hurting the attainment of food sufficiency and food security include post-harvest losses caused by poor handling and lack of modern processing facility, high cost of farm inputs, such as fertiliser and other agro-chemicals. Persistent calls for interest-friendly loans for farmers appear to have also gone unheeded.

Although the Central Bank of Nigeria (CBN) said it created several lending programmes and provided hundreds of billions to smallholder farmers and industrial processors in several key agricultural produce, many farmers are still agonising over lack of credit facilities to embark on large scale farming.

Now, the chickens have come home to roast. The twin shocks of the pandemic and the associated sharp fall in oil prices have combined to set the stage for an impending food crisis in Nigeria. This came as measures put in place by the Federal and state governments to contain the spread of the pandemic dislocated the domestic food production and supply chain by constraining farmers from planting, managing and harvesting critical crops.

The Lagos State Government and a few other states first responded to the spread of the pandemic by announcing partial restriction of human and vehicular movement. But the rising number of confirmed the virus cases compelled President Muhammadu Buhari to announce a shutdown of Lagos, Ogun states, as well as the Federal Capital Territory (FCT).

Other states followed suit with either total or partial restriction of movement to contain the spread of the virus. But, in doing so, the nation’s food production and supply chain took the hit. Small holder farmers had limited access to inputs such as fertilisers, just as input providers were unable to reach farmers in their locations. Farmers who manage to have access to input could not access their farms to plant or harvest. Their access to markets was also impeded.

Also, importers of farm input contended with rising prices because of the rise in dollar compounded by the Covid-19 crisis. Price of farm input went up by as much as 24 per cent, which overall, impacted on cost of production, leading to increase in food prices. Farmers who could not afford the necessary input for their production were hit by lower yield.

African Development Bank (AfDB) Director of Agriculture and Agro-industry Dr. Martin Fregene and Director of Agricultural Finance and Rural Development Atsuko Toda observed that anti-pandemic measures like nationwide lockdowns and border closures compounded food shortages, especially of nutritious but perishable foods like fruit and vegetables.

The experts noted that restrictions on movement and quarantine measures impeded farmers’ access to markets. They pointed out, for instance, that in Nigeria, rice prices were 30 per cent higher than in January, thanks to panic buying, transport restrictions and rising global prices.

The situation was critical to the extent that the management of the National Agricultural Seeds Council, Nigeria’s seed industry regulator, had to liaise with the government to grant permits to agricultural workers to address some of the farmers’ needs in terms of seed supply, as the farming season commences. The Council’s spokesperson, Folarin Okelola, even admitted that getting to his office was challenging.

The gravity of the food crisis staring Nigerians in the face after the relaxation of the lockdown is not lost on the Minister of Agriculture, Muhammed Sabo Nanono. “There is no question about it that there is an imminent problem of food insecurity, not only in Nigeria, but also in nations all over the world,” he said.

The Minister, however, noted that Nigeria had at least 38, 000 tonnes of grains in government-controlled strategic reserves, but looking to replenish with 100, 000 additional tonnes.

According to the Minister, movement restrictions of people and goods impacted on food processors, traders, trucking and logistics in the food supply chains hence, it was necessary to work out solutions that would facilitate easy access to food supply chain in the country as the disruptions of economic activities caused by the COVID-19 pandemic were glaring and threatens the domestic food supply chains.

“More worrisome is the fact that the Covid-19 crisis could potentially spark a food security crisis in Africa, with agricultural production potentially contracting in 2020 and 2021,” he said. This is so considering that the stay-at-home order, which is being gradually relaxed, stopped pepper, tomato, Okro, and fluted pumpkin farmers, among others, getting to their farms to harvest their crops and supply to various markets.

Nanono expressed concern about the restrictions in the rural areas where the chunk of Nigeria’s agricultural produce came from. According to him, the rural areas are dependent on access to input to produce crops and access to markets for their output across the country. “If enough foodstuffs were not produce in the rural areas, it would increase in costs of food items in urban areas,” he stated.

Heartache over crashing oil prices

Oil prices have dipped to historical lows, hitting as low as $17 per barrel at a point. The demand for oil reduced significantly as a result of the outbreak of Covid-19. China, the epicentre of the Covid-19 pandemic, is the world’s second largest consumer of oil and its demand for oil alone reduced by 20 per cent. The spread of the covid-19 dampened demand from China and and European refiners.

However, the dramatic dip in oil price is not entirely caused by the pandemic. Oil production is said to have outpaced demand due to the impasse between Organisation of Petroleum Exporting Countries (OPEC) and OPEC + (Russia) in a bid to rein in threats from the surge in the US on oil production.

It is easy to see the connection between tumbling oil prices and food insecurity. Oil revenue accounts for about 50 per cent of government revenue and about 85 per cent of foreign exchange earnings. With the scenario of tumbling oil price, a drastic reduction in the revenue of government has become inevitable.

Already, Nigeria has reduced her projection of 2.1 million barrels daily of oil production to 1.7 million and has cut a record $35 billion budget for the year based on an oil price of $57 a barrel, down by about 15 per cent. This means that budget implementation has been constrained; infrastructure financing will be affected; borrowing may increase, and the capacity to fund capital projects has been severely constricted.

It also means, by extension, that the government’s ability to continue to fund the nation’s huge food import bill has been seriously constrained. Beyond the fact that the increase in the cost of food importation has become unsustainable, several countries are said to have resorted to export restrictions of critical agricultural produce.

Citing the International Food Policy Research Institute (IFPRI), CBN Governor Godwin Emefiele recently said, for instance, that about 37 countries have enacted various forms of food export restrictions in response to Covid-19, even in countries where average production exceeds domestic consumption.

Emefiele said, for example, that Vietnam, the world’s third largest exporter of rice, suspended granting rice export certificates until the country “reviews domestic inventories”. Russia, the world’s largest wheat exporter, also announced a 10-day ban on the export of buckwheat and rice due to concerns over panic buying in local supermarkets.

Apparently worried by the situation, the CBN boss raised some posers: “What if these restrictions become the new normal? What if the Covid-19 pandemic continues in a second wave or another pandemic occurs in which all borders are shut, and food imports are significantly restricted?”

He said although these developments were troubling, they presented an opportunity to re-echo a persistent message the apex bank has been sending for a long time, and at this time, even more urgently so: Nigeria must look inwards as a nation and guarantee food security….

“For a country of over 200 million people, and projected to be about 450 million in a few decades, we can no longer ignore repeated warnings about the dangers that lie ahead if we do not begin to depend largely on what we produce locally, because the security and well-being of our nation is contingent on building a well-diversified and inclusive productive economy,” Emefiele said.

To address the food crisis, Toda and Fregene recommended some short-term measures, including the creation of a “green channel” for the free flow of food and agricultural input, creation of strong demand for agricultural inputs of fertiliser, seeds and agro-chemicals through smart input famer subsidies.

They also said there was the need for measures to prevent food price hikes by releasing food from government grain reserves and implementing anti-hoarding policy; rapid scale up of food production technologies, including high-yielding, early-maturing, drought-tolerant, disease- and pest-resistant staple crops, livestock and fish.

The experts also recommended medium to longer-term food security interventions including provision of recovery strategy support to key supply chain players like logistics companies and anchor farmers; strengthening food supply chain resilience via efficient production, processing and value addition; enforcing food safety, improved food quality and traceability policies in the post-coronavirus period.

May 7, 2020
World Bank: COVID-19 could push 49m people into extreme poverty

Our Reporter

World Bank Group has said COVID-19 pandemic could push 49 million people into poverty in the year.

The bank in a report said: “The coronavirus (COVID-19) is a crisis like no other the world has faced in recent decades in terms of its potential economic and social impacts.

We estimate that the pandemic could push about 49 million people into poverty. A large share of the new poor will be concentrated in countries that are already struggling with high poverty rates, but middle-income countries will also be significantly affected.

Almost half of the projected new poor (23 million) will be in Sub-Saharan Africa, with an additional 16 million in South Asia.

The number of extreme poor in the poorest countries that are served by the World Bank’s International Development Association is projected to increase by 17 million.

“At the same time, 22 million of the projected new poor will be in middle-income countries. There are projected to be 10 million new extremely poor people in fragile and conflict-affected economies.

The measures taken to contain COVID-19 will affect households in many ways, including job loss, loss of remittances, higher prices, rationing of food and other basic goods, and disruptions to health care services and education.

While the impacts will be felt by most households almost immediately, they will likely be deeper and longer-lasting among the poor, who are more vulnerable for several reasons:

According to the bank report, “The poor live primarily in rural areas. While this could minimise their exposure to the disease, it also means they have limited access to health services.

Read Also: How I survived COVID-19, by El-Rufai

Moreover, since rural households tend to depend more on domestic remittances from urban migrants, economic shutdowns in urban areas will hurt them too.

The poor in urban areas, on the other hand, live in congested settlements with low-quality services, which would significantly increase their risk of being infected by the contagion. Disruptions in food markets could be more severe in urban areas.

“The poor work largely in the agriculture and service sectors and are usually self-employed or informally employed, mainly in micro and family enterprises. Those employed in the informal service sector in urban areas are likely to bear the most severe initial impacts.

In addition, many of the vulnerable non-poor, who are increasingly employed in the gig economy, particularly in middle-income countries, will also be at risk of slipping into poverty.

Those engaged in agriculture may be able to cope, at least initially, with potential disruptions to food supplies or price spikes, but are likely to be affected by a decline in demand in urban areas over time. In the immediate term, limited access to high-quality and affordable health services can have devastating impacts in the event of an illness in the family, while school closures can lead to a decline in food intake among children of poor families who rely on school feeding programmes.’’

In the long term, the impacts of lost months of schooling, early childhood interventions, health check-ups, and nutrition can be particularly high for children in poor families, adversely affecting their human capital development and earning potential.

This, in the absence of adequate safety nets, can force the poor to rely on coping strategies with potential long-lasting negative effects, such as the sale of productive assets or diminished investments in human capital.

April 30, 2020
AU, Ecobank to support MSMEs

The African Union Development Agency (AUDA-NEPAD) and Ecobank Group have agreed to collaborate on a continental initiative to support African Micro, Small and Medium Enterprises (MSMEs) as they face challenges posed by the Covid-19 pandemic.

AUDA-NEPAD Chief Executive Officer Dr. Ibrahim Assane Mayaki and his Ecobank Group counterpart Mr. Ade Ayeyemi, said one of the objectives of the initiative was to create a one-stop platform which will address the challenges of MSMEs during and post-Covid-19.

It will also be an all-encompassing, flexible and comprehensive one-size-fits-all tool for MSMEs in the formal and informal sectors across the continent; identify opportunities and innovative ways to support and protect MSMEs and job opportunities, especially in food and agribusinesses, technology startups, health specialised entities and those operating along with supply chain operations.

Noting that MSMEs account for an estimated 90 per cent of businesses in most African economies, they added that the framework will help coordinate and harmonise initiatives and ongoing efforts that support MSMEs to gain access to information, finance, and fiscal stimulus during the outbreak.

The platform also aims to ensure that MSMEs have continuous access to national, regional and continental markets, recommending to policymakers, solutions on domestic debts as they are projected to face challenges due to the economic difficulties that the member states will face.

On the initiative, Mayaki said: “The COVID-19 pandemic while affecting global economies, will have a devastating effect on African economies and businesses.

Read Also: CBN resumes dollar sales for SMEs, school fees

“AUDA-NEPAD and Ecobank Group intend to jointly build a continental platform based on our initial ‘100, 000 SMEs by 2020’ campaign, which will provide an immediate response to the potential impact of Covid-19 on SMEs and job creation on the continent.”

Mayaki added that AUDA-NEPAD will leverage on its existing instruments, networks, and programmes to gather stakeholders around a digital platform that showcases and monitors the progress made.

Ayeyemi said the fragility of some of the African economies is more pronounced with the impact of Covid-19. He, therefore, said a continental coordination was essential to support national measures by governments to curb the spread of the virus on the continent.

He further underscored that MSMEs, which form a large part of individual economies in Africa, have little or no absorption capacity to the effect of the pandemic.

“As a long-time partner of AUDA-NEPAD, we welcome the opportunity to work with the agency to co-lead this continental platform that will empower MSMEs with knowledge, resources, mentoring, technical expertise and financial support to ensure the sustainability of their businesses during and post-Covid-19.

“The objective of the continental platform is indeed, aligned with the Ecobank vision of contributing to the economic and social development of Africa, our home,” Ayeyemi added.

April 30, 2020
PZ: soap vital to COVID-19 fight

By Busola Aro

Manufacturer of personal healthcare products and consumer goods, PZ Cussons, has said affordability of detergents/soap to wash hands is also a critical element in the fight against COVID-19 pandemic.

The Chairman, PZ Cussons Foundation, Prof Eyitayo Lambo, who spoke during the donation of soap to over 40,000 people towards controlling the spread of the pandemic in the country in six cities across the country, said it was on this realisation that the Foundation in collaboration with Foundation for Refugee Economic Empowerment (FREE), took the step to promote healthy living.

FREE is a UK and Nigerian charity that aims to provide high quality, timely, accountable, and inclusive humanitarian assistance to displaced persons towards enabling them to return to normal and sustainable productive lives.

Lambo said: “We have since learned that one of the simple ways to stay protected against the coronavirus is by consistent handwashing with soap. Sadly, however, not everyone can afford to do this.

Read Also: NCDC targets two million people for COVID-19 test in three months

‘’So, the PZ Cussons Foundation has partnered with FREE to ensure that even the most vulnerable communities are catered for at such a time as this to support the on-going efforts to stem the spread and contain the virus in Nigeria.

“The PZ Cussons Foundation has been a major advocate for proper sanitation and hygiene standards and has, for the past five years, partnered successfully with United Purpose in increasing awareness and understanding about the importance of handwashing with soap as an easy, effective, and affordable way to prevent diseases and save lives.

We, therefore, encourage everyone to stay at home and stay protected by washing their hands with soap, among other preventive measures,” Prof Lambo said.

Launched in 2007, PZ Cussons Foundation has been helping Nigerian communities by supporting projects in areas of roads, and other infrastructural improvements such as water, sanitation, health and education. The Foundation has completed over 100 projects in different parts of Nigeria.

April 30, 2020
FrieslandCampina WAMCO donates N500m

By Chikodi Okereocha

FrieslandCampina WAMCO Nigeria Plc, makers of Peak and Three Crowns brands of milk, has donated N500 million to the Private Sector Coalition Against Covid-19 (CACOVID) fund.

The donation, which came as part of the firm’s Corporate Social Responsibility (CSR), followed the company’s recent donation of N100 million worth of Peak and Three Crowns milk products to support over 100,000 families.

The beneficiaries of the products are those in low-end communities and vulnerable groups who are at risk of compromising their nutritional needs..

The Chairman of the Board of Directors, FrieslandCampina WAMCO Nigeria Plc, Mr. Moyo Ajekigbe, said: “The novel coronavirus pandemic is a global disaster that has cost the world thousands of lives and threatens its economic well-being.

“At FrieslandCampina WAMCO, we believe that everyone must come together to make a difference. If we join hands with government and credible associations to provide substantial palliatives, critical medical supplies, and with the cooperation of every Nigerian through the adherence of precautionary measures, we will defeat the Covid-19 hence, our donation of products and funds.”

The Managing Director, FrieslandCampina WAMCO, Mr. Ben Langat, said: “We have made several donations to support meaningful initiatives in the fight against the Covid-19 pandemic; this indeed, represents the confidence and care we have for Nigeria.

“As we encourage Nigerians to unite to defeat the pandemic and reach for their peak again, FrieslandCampina WAMCO Nigeria will continue to take responsible actions that ensure we make nourishing dairy nutrition accessible for Nigerians.”

April 30, 2020
How Finance Act 2019 resolved ambiguities in tax laws

Before the passage of the Finance Act 2019 into law in January, certain of its provisions were ambiguous. They were, therefore, subjects of litigation at various courts and tribunals across the country. But the Act introduced changes to seven major federal tax laws to bring clarity to the laws and provide certainty to tax payers. Assistant Editor CHIKODI OKEREOCHA looks at how the Finance Act 2019 amended the ambiguous and outdated provisions in the principal federal tax laws.

For professional services company PricewaterhouseCoopers (PwC Nigeria), amending ambiguous and outdated provisions in the principal federal tax laws was one of the major achievements of the Finance Act 2019.

President Muhammadu Buhari had on January 13, last year, signed the Finance Bill into law.The core objective of the Act was to bring the law into conformity with the Federal Governments’ policies and to generate, in the short term, revenue to fund the 2020 Budget.

PwC said it is expected that a finance act would be passed annually to reflect government policy, bring the federal tax laws in line with modern business realities and raise revenue to fund yearly budgets.

It noted that the Act contains 57 sections and amends seven major federal tax laws – the Companies Income Tax Act (CITA), Petroleum Profits Tax Act (PPTA), Personal Income Tax Act (PITA), Capital Gains Tax Act (CGTA), Value Added Tax Act (VATA), Customs and Excise Tariff Etc. (Consolidation) Act (CETA) and Stamp Duties Act (SDA).

PwC, however, pointed out that before the passage of the Finance Act 2019 into law, certain ambiguous provisions of the tax laws were subjects of litigation before various courts and tribunals across the country. It, however, said the Finance Act 2019 introduced changes to these provisions to bring sanity to the law and provide certainty to taxpayers.

PwC in its “Tax Controversy & Dispute Resolution (TCDR) Insight Series” released on April 8, looked at ambiguous provisions in four federal tax laws pre-Finance Act 2019, highlighted some of the implications of these provisions, discussed the related case law and the changes introduced by Finance Act 2019 to cure the ambiguities in the laws.

The four federal tax laws were PwC said there were ambiguous provisions include Companies Income Tax Act (CITA), Personal Income Tax Act (PITA), Value Added Tax Act (VATA), and Stamp Duties Act (SDA). For instance, Section 19 of CITA imposed a tax commonly referred to as Excess Dividend Tax (EDT).

According to PwC’s analysis, a literal construction of section 19 suggested that where a company pays dividends, which exceed its total profits, the company would be subject to additional tax of 30 per cent on the excess dividends it distributes, as though they were profits.

“The literal application of section 19 meant that companies which fail within the ambit of the section were potentially exposed to a total tax charge of 62 per cent,” PwC’s tax expert and lead author of the report, Taiwo Oyedele, said, pointing out that there were other problems with applying section 19 literarily.

He said, for instance, that Section 19 of the Act does not consider circumstances where company pays out dividends from its retained earnings (profits which have suffered tax in prior years), or companies which earn tax exempt income (such as income from government bonds and treasury bills) and have no taxable profits but pay dividends from the exempt income.

Read Also: Fed Govt switches to local loans to finance budget 2020

Noting that disputes arising from section 19 of the CITA are before the Supreme Court, with the Federal Inland Revenue Service (FIRS) winning all through the lower courts, the report co-authored by Folajimi Akinla said the Finance Act 2019, interestingly, addressed the shortcomings of applying section 19 literally.

For instance, Section 7 of the Act exempts from EDT the following categories: dividends paid from retained earnings which have been subject to tax under any of the income tax laws; dividends from exempt profits; franked investment income including distributions from real estate investment companies to its holders.

“The amendments are far-reaching given the way and manner section 19 had been previously interpreted. Now, from a tax perspective multinationals and domestic companies can set up holding companies in Nigeria without the fear of a potential 62 per cent tax charge.

“In addition, other laws such as the Exemption Order can now, considering their objectives, be given full effect and are no longer rendered redundant by the operations of section,” the report, which was made available to The Nation, said.

Other ambiguous provisions in the other three federal tax laws identified by PwC, but resolved by the Finance Act 2019 include taxation of gratuities in Third Schedule to PITA; definition of “imported services” in Section 2 of VATA.

There is also registration of non-resident companies in Section 10 of VAT Act; definition of “goods” and “services” in Section 46 of VATA; definition of exported services in Section 46 of VATA.

The report also said the provision for duty on receipts in Section 89 of the pre-Financial Act 2019 Stamp Duties Act (SDA), which imposed a duty of N1.50 on any receipt for money, bill of exchange or promissory note of a sum not exceeding N40, was ambiguous.

Concluding, PwC observed that many of the disputes arising from the tax laws were caused by inelegant drafting, which resulted in ambiguities, while others arose because of outdated provisions of the law.

It, however, pointed out that “With the Federal Government committing to annual reviews of the laws, it is expected that similar disputes can be avoided.”

April 30, 2020
Power privatisation: Why private operators renewed push for review

But for the adverse effects of the COVID-19 pandemic, a new electricity tariff regime would have been in place from April 1, 2020. Although the Nigerian Electricity Regulatory Commission has shifted the implementation of the tariff review for three months till June 30, 2020, private sector operators, particularly manufacturers, are vehemently opposed to the plan, in view of the prevailing inadequate electricity supply. They are calling for a suspension of the plan, as well as a review of the power sector privatisation. Assistant Editor CHIKODI OKEREOCHA reports.

A major crisis is brewing in the Nigerian Electricity Supply Industry (NESI). And it took a proposal by the Nigerian Electricity Regulatory Commission (NERC) to increase electricity tariff in the face of the perceived prevailing inadequate power supply to set the stage for a possible confrontation between it and members of the Organised Private Sector (OPS), particularly manufacturers.

The NERC literarily touched the raw nerves of private operators when it released its March 31 “Order on the Transition to Cost Reflective Tariffs in the Nigerian Electricity Supply Industry” signed by NERC Chairman, Prof. James Momoh, and the Commissioner in charge of Legal, Licensing, and Compliance, Mr. Dafe Akpeneye.

Under the Order, which has pitched the Commission against private operators, a new electricity tariff regime was supposed to have been in place from April 1, 2020. However, the rampaging COVID-19 pandemic and its consequential impacts on Nigerians, coupled with wide metering gap forced the NERC to suspend its implementation.

The suspension of the tariff review is for three months, which means that the new electricity tariff regime earlier scheduled for April 1, now has a new takeoff date of June 30, 2020.

Private operators kick

Regardless of when the implementation of the new electricity tariff regime kicks off, the proposed upward review will surely be met with stiff resistance by private operators, particularly manufacturers. They voiced their concern about the potential impacts of the proposed tariff increase on the economy, particularly as it affects private sector businesses.

The Organised Private Sector in Nigeria (OPSN), in a statement said, it is “not in support of any minor, major and extra-ordinary tariff review, or the proposed upward review in electricity in an economy that just came out of recession and currently experiencing fragile growth.”

While the OPSN said it appreciated the NERC’s efforts to sustain improvement in electricity supply and seamless operations of the NESI for the benefit of the country and private businesses, it, however insisted that an upward review of tariff will be counterproductive on consumption and productivity.

It said any form of increase in electricity tariff in the face of inadequate electricity supply, high electricity tariff and exorbitant cost of self-generated electricity, will further spike the cost of doing business with consequential upward spiral effects on unemployment rate.

At moment, electricity outages average about 10 hours per day; electricity expenses still constitute about 40 per cent of total cost of production, with the cost of self-generated electricity averaging N119 billion in 2019 alone.

“Most worrisome is the fact that private sector operators, especially manufacturers bear the burden of commercial and technical losses through very high monthly electricity bill that is largely estimated,” OPSN said.

The OPSN comprising Manufacturers Association of Nigeria (MAN), Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), Nigeria Employers Consultative Association (NECA), Nigerian Association of Small and Medium Enterprises (NASME), Nigerian Association of Small Scale Industrialists (NASSI) made its position known in a statement released on April 2, 2020.

The statement, which was made available to The Nation, said private operators are already plagued by high cost operating environment arising from poor regulatory environment, macroeconomic asymmetries and high cost of energy, adding that this unfriendly operating environment was responsible for the oscillatory performance of the sector in the past few years.

The OPSN also said the planned increase in tariff was coming at a time that private businesses, especially MSME are groaning under the pain of injuries inflicted on them by the last economic recession, the prevailing harsh operating environment and the increasing burden of taxes.

Besides, the state of readiness in terms of competitiveness for the African Continental Free Trade Area (AfCFTA), which takes off July this year, is currently at the lowest ebb.

That is not all. The private operators argued that the trajectory of continuous increase in electricity tariff without commensurate improvement in electricity generation, transmission and distribution is not sustainable and would have catastrophic impact on the real sector.

“The proposed increase in electricity tariff is coming also at a time that the NESI is pervaded with high level of inefficiency, low investment in strategic electricity infrastructure; majority of consumers are not metered and the billing system is still largely estimated,” they added.

They further argued that an upward review in electricity tariff will worsen the already precarious position of the critical mass of small and medium businesses. Also to feel the heat of the proposed increase in tariff, according to the group, are strategic private sector businesses with high electricity intensity processes.

Lending his voice to the growing outcry by private operators against the proposed increase in electricity tariff, MAN President Engr. Mansur Ahmed said modern industry competitiveness depends to a great extent on provision of adequate and efficient infrastructure especially electricity supply.

Ahmed, who spoke at the “2020 MAN Annual Media Luncheon” held in Lagos, said, for instance, that electricity is a vital input for manufacturing process to the extent that it constitutes up to 40 per cent of the cost of production.

He, therefore, said increasing the tariff of this core input will have drastic negative effect on the Gross National Product (GNP), GDP, disposable income, consumption, consumer price index, employment, and government revenue from corporate taxation etc.

The MAN chief said similar to this is the uneven pricing of this commodity (electricity) across DisCos, which if not corrected, will lead to uneven development in certain parts of Nigeria as the percentage increase in tariff differs.

While stating that a reduction in electricity tariff for industrial purpose is more ideal, he said even if it cannot be reduced, “I should not be increased. Any increase on the tariff will reinforce the already high cost manufacturing environment and further depress productivity in the sector.”

Ahmed, therefore, said: “Our appeal is that government, being a major stakeholder in the electricity industry, should concentrate on developing processes and polices to attract significant investment to encourage large scale generation and significant improvement in transmission and distribution.

“It is also important for government to ensure adequate and appropriate consultations with stakeholders in the private sector on such decisions with far-reaching implications.

Push for suspension of tariff increase

Against the background of the aforementioned concerns, private operators have kicked their heels in, insisting that “The proposed tariff increase should be suspended in the best interest of the Nigerian economy.”

They stated that even if electricity tariff cannot be reduced, it should not be increased, reiterating that “Any increase in tariff will reinforce the already high cost of doing business for the private sector and further depress productivity in the manufacturing sector.”

Instead of contemplating an increase in electricity tariff, the OPSN suggested that government, being a major stakeholder in the electricity industry, should concentrate on developing processes and polices to attract significant investment to encourage scale generation with improved transmission and distribution infrastructure in the industry.

Renewed agitation for review of power privatisation

The Federal Government had in November 2013 unbundled the defunct Power Holding Company of Nigeria (PHCN) into 18 successor companies and subsequently handed over the power assets of the successor companies to private investors. It was expected to set the stage for a major transformation of the power sector to guarantee uninterrupted electricity supply to the manufacturing sector and Nigerians in general.

But seven years after, this has not happened. Rather than enjoy significant improvement in electricity supply, Nigeria’s electricity generation capacity has been wobbling between 4, 500 Megawatts (Mw) and 5, 000 Mw, leaving sour taste in the mouth of consumers. Nigerians are still groaning in darkness, lack of metres, dearth of power infrastructure and high tariff, among other issues.

While manufacturers and Nigerians are agonizing over the alleged failure of the privatisation exercise to address these issues and ultimately, turn the power sector around, arbitrary and startling increases in tariff and other discomforting developments such as fixed charges and unwarranted disconnections by Electricity Distribution Companies (DisCos) appear to rob salt to injury.

Against the background of the foregoing, the OPSN drew attention to some obvious questions that readily come to mind, one of which was whether any increase in electricity tariff should be approved by the NERC in the face of the prevailing inadequate electricity supply, despite the privatisation.

The group raised other pertinent questions: “Why has NERC not addressed the issue of current exploitative tariff structure that is skewed against the private sector but increased liquidity in the coffers of the Discos? Is the level of improvement in electricity distribution and associated infrastructure commensurate with previous upward reviews in electricity tariff?

“What is the level of investment and achievements made by the DisCos in reciprocation for previous reviews? Is NERC satisfied with the current high-level inefficiency that pervades the operations of the DisCos? Are the prevailing macroeconomic fundamentals including the backlashes of Covid-19 congenial to an upward review in electricity tariff?”

While it is not clear if and when private operators will get answers to these questions, what is, however, undeniable is that manufacturers’ productivity and competitiveness have nosedived despite the power sector privatisation. And the resultant frustration has reignited operators’ age-long agitation to a review of the privatisation.

The OPSN did not mince words when it said “Government should review the privatisation/unbundling of the electricity industry in the best interest of the over two hundred million of Nigerians.”

However, private operators are not alone in such call. Recall that early this year, Senate President Ahmad Lawan also called on the Nigerian Government to review the privatisation of the country’s power sector.

“I think the privatisation has not worked. It has failed because the essence of privatisation is to create efficiency,” Senator Lawan, who spoke when he addressed the Executive Committee of MAN, in Abuja, said, noting:w “It appears most of the DisCos have no sufficient capital and probably the same thing with the GenCos.”

However, despite the renewed agitation for review of the power privatisation, the NERC has continued to caution against a review or reversal of the privatisation. The Commission argued, for instance, that the Federal Government may not have money to buy back the power utilities.

April 23, 2020
Rattled by covid-19, manufacturers push to mitigate shocks

The advocacy focus of the Manufacturers Association of Nigeria (MAN) has shifted, in response to the dislocation forced on the manufacturing sector by the Covid-19 outbreak. From its usual focus on issues around infrastructure deficiencies, patronage of made-in-Nigeria products, regulatory and trade facilitation, the emphasis is on what the government, working with industry operators and stakeholders should do to help manufacturers weather the storm. Assistant Editor CHIKODI OKEREOCHA examines some of the measures and policy responses put forward by manufacturers.

No one saw it coming. And if anybody did, it is highly improbable that he anticipated the global scale and ferociousness of the Covid-19 outbreak. Like wildfire, the deadly virus, which was first identified last December, in Wuhan, Central China, has since spread across continents from mainland China, its root, to Asia, Europe, America and Africa. The pandemic eventually found its way into Nigeria on February 27, through an Italian who travelled from Milan to Lagos, in a Turkish Airline.

Since then, it’s been a tale of woes for Africa’s largest and most populous economy, particularly the manufacturing sector. For instance, as the Director-General of Lagos Chamber of Commerce and Industry (LCCI), Mr. Muda Yusuf, put it, the global supply chain has been deeply disrupted as China, which is the second largest economy in the world, is a major supplier of input for manufacturing companies around the world, Nigeria inclusive.

According to him, “Many manufacturers and service providers in the country are already experiencing acute shortage of raw materials and intermediate input. This has implications for capacity utilisation, employment generation (and retention) and adequacy of products’ supply to the domestic market. There is also an implication for inflation and the pressures are already mounting.” This is so because China represents Nigeria’s biggest trading partner, with about 19 per cent of its imports sourced from the Asian giant.

In all, over 70 per cent of manufactured goods in Nigeria are imported. And with the unprecedented spread of the killer virus across the globe, the implications are not lost on local manufacturers.

This is why manufacturers have shifted the focus of their advocacy to underscore the imperativeness of appropriate policy responses to mitigate the impacts of the rampaging coronavirus on their operations and by extension, the economy.

For instance, even before the decision by various state governments to lock down business, economic and financial activities and the eventual national declaration by President Muhammadu Buhari, manufacturers had, as one of the coping measures, requested the Federal Government to ensure reasonable access to industrial supplies and input. i.e. gas, electricity supply, fuel and other essential infrastructure needs.

In a statement made available to The Nation, MAN President Mansur Ahmed also said as part of the Federal Government’s efforts to mitigate the impacts of the Covid-19 pandemic on the economy, the Central Bank of Nigeria (CBN) should extend its financial support to the supply of Foreign Exchange (Forex) to the manufacturing sector at pre-Covid-19 rates, and also consider directing commercial banks to freeze interest charges in the event of a lock down

Ahmed also wants the government to consider the introduction of fiscal measures such as waivers on import duties on Active Pharmaceutical Ingredients (APIs), and other essential products; extend tax holiday to companies on corporate tax, and waive the Value Added Tax (VAT); reduce the burden of personal income tax as a way of increasing the disposable income of an average Nigerian worker.

That is not all. MAN said as the voice of manufacturers’ interest in Nigeria, it will gladden the hearts of its members if government ensures that all regulatory agencies, such as Nigeria Customs Service (NCS), Nigeria Ports Authority (NPA), Standards Organisations of Nigeria (SON), and National Agency for Food, Drugs Administration & Control (NAFDAC), will treat all requests from manufacturers expeditiously and with the required sensitivity to the prevailing situation.

The MAN president further urged the government to prevail on relevant agencies to comply with the provisions of Executive Orders 001, 003 and 005; ensure its agencies do not act contrary to its directive of permitting essential manufacturing sectors to operate; and also take into consideration the inclusion of the logistics and distribution arm of manufacturing to make possible delivery of manufactured items to the final consumers.

Vice President Yemi Osinbajo, then Acting President, signed the Executive Order 001 on May 18, 2017. It was expected to help change the ways the government’s business and operations are conducted in the country. This is by entrenching measures and strategies to promote transparency and efficiency in the business environment.

The Executive Order 003 requires Ministries, Departments and Agencies (MDA) of government to grant preference to local manufacturers of goods and service providers in their procurement of goods and services.

It was a shot in the arm of manufacturers who have long been clamouring for local content in public procurement by the Federal Government, particularly increased patronage of made-in-Nigerian goods and services.

On the other hand, Buhari signed into law the Executive Order 005 on Monday, February 5, 2018, to demonstrate the Federal Government’s efforts at promoting the application of science, technology and innovation within Nigeria. The Order recognised the role of science, technology and innovation in national economic development and to increase the quantum of value created in the Nigerian economy via local content in public procurement.

But, as potentially game-changing and promising as the executive orders were, perceived shoddy implementation has continued to limit their capacity to help entrench a regime of efficiency and transparency in the way businesses are conducted in the country. There have been concerns over the level of compliance with the orders, as agencies charged with implementation the orders allegedly fail to do so.

That manufacturers are urging the government to prevail on all relevant agencies to strictly comply with the provisions of Executive Orders is seen as confirmation that government needed to walk the talk on the implementation of the executive orders. This is so particularly now that their full implementation is needed as wedge for a manufacturing sector severely hit by the Covid-19 pandemic.

Experts have also weighed in on the need for government to take urgent steps to mitigate the shocks associated with the Covid-19 lockdown on the nation’s manufacturing sector and the economy. This is so considering that the dislocation of business, economic and financial activities caused by the Covid-19, coupled with tumbling oil prices causing significant havoc on the 2020 budget has triggered fears that the economy may slip into another recession.

For instance, Partner, KPMG, Mr. Ajibola Olomola, said some of the imperatives for the Nigerian Government and corporates to mitigate the obvious impacts of the lockdown include intensifying efforts towards building domestic capacity across critical sectors such as manufacturing, increasing investment in technology that would optimise existing business processes (e.g. digital and online presence).

The KPMG tax expert also advised the government to ensure that tax enforcement practices do not stifle business growth. Olomola, who spoke at a recent forum organised by the LCCI in Lagos, also said there was the need to increase investment in public health infrastructure while experimenting on the possibility of large-scale remote working for employees and its impact on productivity.

For Yusuf, appropriate policy choices are needed to attract equity domestic and foreign private sector capital for infrastructure financing. According to him, the government needs to look beyond tax credit in its quest for complimentary funding sources for infrastructure. “We should be looking more in the direction of equity financing. But for this to happen the policy and regulatory environment must be right,” he said.

The LCCI DG also said it had become critical to review the spending structure of government and the cost of governance. “The ballooning recurrent expenditure in the face of declining revenue is a cause for concern,” he said, adding that Public-Private Partnership and Public-Private Dialogue should be deepened to harness quality ideas on how to manage “This rather scary situation.”

Ray of light on the horizon

Interestingly, some of the manufacturers’ suggested policy responses to help weather the storm triggered by the Covid-19 lockdown may have hit the right chord in the ears of the authorities. The Nation learnt, for instance, that the state governors, under the aegis of Nigeria Governors’ Forum (NGF), have given manufacturers of essential products and services easy movement during the 14-day lockdown to contain the spread of the Covid-19 pandemic.

The MAN president confirmed this much. Noting that the food, beverage, pharmaceutical and other complementing sectors that make the value chain of essential products available are very critical, he said the association was glad that government recognised this critical role in its directive for 14 days lockdown, adding that its members have testified to unhindered operations in the face of the lockdown.

However, this was as a result MAN’s advocacy refocus on putting in place measures to help manufacturers adjust and cope with the coronavirus pandemic. Ahmed stated that since the decision to lock down economic activities as a way of containing the spread of the virus, MAN has maintained consistent talks with relevant government stakeholders on the survival and sustenance of livelihood of Nigerians via the operation of critical manufacturing sectors.

According to him, such talks indeed, yielded positive results, one of which was a letter addressed to him by the Chairman of the NGF and Ekiti State Governor, Dr. Kayode Fayemi, for manufacturers. “I am deeply impressed by the move of the NGF for taking heed to the call of manufacturers of essential products at a time like this,” Ahmed said.

The NGF, had in a letter to MAN, dated March 30 and titled: “Covid-19 Emergency Response-Special Clearance for Producers, Suppliers and Distributors of Essential Goods and Services”, conveyed its support to manufacturers to ensure that their operations are unhindered with continued effective and efficient movement of essential items.

The letter, which was signed by Fayemi and made available to The Nation, read in part: “Considering the crucial role you (Manufacturers) play in ensuring the production of essential items such as nutritious foods (including beverages), medical and pharmaceutical products considered critical for the sustenance and well-being of individuals and families especially in these times.

“Following careful and deliberate consideration by the 36 governors of the Federation, we are pleased to convey to you our full support to ensure that your operations are unhindered with continued effective and efficient movement of such essential items.”

Accordingly, the NGF said parastatals and agencies of the 36 state governments have been advised that the operations and activities of food, medical and pharmaceutical product companies and their suppliers of raw materials and packaging materials, service providers (logistic companies, etc), transporters, distributors, sales team and retailers should not be hindered by officials or agents of the state governments.

The NGF, however, said food, beverage, pharmaceutical and medical companies are required to issue all suppliers and transporters a letter of authority confirming that they are authorised by them; that all their staff ensure they carry their identity cards at all time for all movements, with a copy of the letter of authority.

The Forum also said it will soon provide manufacturers with toll-free numbers they can call in case they have any problems or bottlenecks with their letter of authority. “We are working assiduously to ensure unhindered flow of essential goods and services,” the NGF said.

But, Ahmed observed that some security operatives in some states are not yielding particularly, the rank and file officers on the field. He, however, said that to address this setback, “We are in talks with the NGF to give the necessary directives for adequate sensitization of officers who are unyielding to giving manufacturers of essential products easy movement hampering the chain of distribution.”

The MAN president added that while MAN continues to play its role as an advocacy body committed to creating a friendly business environment for manufacturers, “the Association can only rely on the government to reciprocate by implementing the suggestions of MAN on the support for the sector during this era of Coronavirus pandemic.”

He said on its part, in a bid to address the potential impact of the virus on the Nigerian economy, MAN has advised members to ensure they sensitize and educate their workers on compliance with the Nigerian Centre for Disease Control (NCDC) guidelines, and provide requisite facilities and supplies for the prevention of COVID-19 in line with extant guidelines of the NCDC.

Ahmed stated that given the fundamental role manufacturers will be playing at a time like this, they have been encouraged to sustain ongoing operations to avoid reduction or shut down of production activities; and scale up their production especially of essential commodities such as pharmaceuticals, consumables, sanitary and hygiene products needed to curtail the spread of the virus.

April 16, 2020
Fed Govt to monitor supply of essential commodities

From Franca Ochigbo, Abuja

The Minister of Industry, Trade and Investment, Adebayo Adeniyi said the ministry has established an emergency operation centre to monitor the supply of essential commodities at this critical time of the spread of coronavirus.

Adebayo stated this at the briefing on the Covid-19 pandemic to curtail its negative impact on the manufacturing, trade and related sectors of the economy.

H said after the national broadcast by President Muhammadu Buhari, the Ministry of Trade, Industry and Investment estabished establish an Emergency Operation Center to monitor the supply of essential commodities.

This centre, which is housed in the ministry, would help to monitor the real-time status of transportation and delivery of essential goods to cut down on the difficulties being faced by manufacturers, transporters and distributors of essential commodities across the country.

He said since cases of COVID-19 started spreading across the country, state government’s have announced actions ranging from partial lockdowns, to outright bans on movement, to ensuring that the spread of the Coronavirus is controlled, limited or declared non-existent in their respective states.

“As we work to deliver on these key objectives, there has been a dedicated secretariat in place – of men and women from the public and private sectors – who have been working round the clock to ensure that truckloads of food, drugs and other essential items get to their points of destination across the nation.

“After subsequent engagements with the leadership of the Manufacturers Association of Nigeria (MAN) and the Nigerian Association of Chamber of Commerce, Industry, Mines and Agriculture (NACCIMA), one critical constraint that was identified was that while working to comply with the directive of Mr. President, distributors and manufacturers still had restricted movement due to the enforcement of the lockdown by the Nigeria Police Force and other security agencies,’’he added.

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What this means is that the raw material needs of our manufacturers are being met, and recognised road transporters of essential goods are able to transport goods. This synergy, between our law enforcement agencies, our essential manufacturers and producers and the Ministry, will allow us to be able to meet critical demands at this time.

“I would also like to thank the Minister of Aviation, Senator Hadi Sirika, for the partnership with the Ministry by responding appropriately to this crisis, the Aviation Ministry has availed us the use of a number of aircraft to facilitate the movement of essential products and personnel across the nation.

Additionally, the personnel of the Nigeria Customs Service, under the able leadership of Comptroller-General of Customs, Hameed Ali, must also be singled out at this pivotal juncture in our nation’s history, for their work in ensuring the free-flow of essential cargo through our ports to the final destinations across the country”.

Furthermore, as we brace ourselves to respond effectively and thoroughly to this crisis, we have been engaging with the Ministry of Health, NAFDAC, the Standards Organization of Nigeria (SON), and NCDC to identify and augment the list of essential goods and services.

We are working with SON and NAFDAC to ensure the acceleration of the issuance of Certificates of Standards of essential items – without sacrificing the quality of these items. Such items include hand sanitizers; coveralls for our medical workers; face masks; needles; goggles; gloves; Sodium Hypo Chloride; and Digital Thermometers.

In a nation like ours, where a major segment of our population live off daily wages, it is imperative that our citizens have access to essential products.

Consequently, Mr. President has directed the Ministry to work with the Manufacturers Association of Nigeria (MAN); the Nigerian Association of Chamber of Commerce Industry Mines and Agriculture (NACCIMA); Nigerian Traders Association (NANTS); and other affiliated stakeholders to guarantee that the production of essential items like food, medical and pharmaceutical products continues unhindered.

With the support of the NCDC, we have also embarked on the training of emergency COVID-19 volunteers – who now have the requisite skills to handle emergencies in the workplace

April 10, 2020