The Nation Newspaper

Tag: manufacturers

  • Intervention for manufacturers coming

    THE Federal Government is set to implement a special intervention fund  for manufacturers from the first quarter of next year.

    The move, it said, is aimed at tackling rising interest rates. It also followed the inauguration of the National Industrial Policy and Competitive Advisory Council by Vice President Yemi Osinbajo, for devising and supervising policies that will speed up Nigeria’s industrialisation.

    The Minister of State for Industry, Trade and Investment, Hajia Aisha Abubakar, spoke in Ota, Ogun State, during the inauguration of the $50 million sorghum malting and malt extract plant and tour of a facility of the Food, Agro and Allied Industries Limited, a subsidiary of Sona Group of Industries.

    She said under the industrial council, sub-committees charged with tackling financing issues have made their presentations, and interventions that can soften and ensure interest rates are  reduced to encourage industries have been proposed.

  • Recession exit: Manufacturers renew push for local products

    Recession exit: Manufacturers renew push for local products

    Mostly driven by an improvement in oil prices and production volumes, the economy is out of recession and the manufacturing sector is also gathering momentum due to improved foreign exchange liquidity. But, to sustain the recovery tempo, manufacturers are seeking for increased patronage of locally-made products by the government. They argue that the government, being the single largest spender in the economy, holds the ace to boost the industrial sector by increasing its patronage of made-in-Nigeria goods.  Assistant Editor CHIKODI OKEREOCHA reports that the government’s patronage of local products will increase revenue through taxes and job creation, among other positive spin-offs.

    Manufacturers are unrelenting in their push for patronage of locally-made products. Even before the exit from recession, their heart cry was the promotion of goods and services produced locally. Their argument: it is the fastest way of pulling the country out of recession.  According to them, cutting down on the insatiable appetite for imported material to the detriment of locally-produced ones will reduce the pressure on Foreign Exchange (forex) triggered by the nation’s huge import bills and low receipts from exports.

    They further argue that curtailing the growing demand for forex for consumption, rather than capital products and equipment; will strengthen the local currency (the Naira).

    Besides, the patronage of locally-produced goods will stimulate economic growth by revitalising the manufacturing sector and boosting its competitiveness thereby creating jobs.

    Bouyed by the benefits, local manufacturers have again renewed their clamour for increased patronage of their products, following the country’s exit from recession, stating that doing so will sustain the recovery of the economy.

    The National Bureau of Statistics (NBS) has confirmed in one its reports gave the economy, which slipped into recession for the first time in more than two decades in August last year, a clean bill of health. According to the NBS report, in the second quarter of 2017, the nation’s Gross Domestic Product (GDP) grew by 0.55 per cent (year-on-year) in real terms.

    The Bureau described as an indication that the economy has exited recession after five consecutive quarters of contraction since the first quarter of last year. It attributed the recovery to improved performance of oil, agriculture, manufacturing and trade sectors of the economy.

    Experts at multinational consulting firm PricewaterhouseCoopers (PwC) Nigeria also confirmed the out-of-recession claim. The PwC attributed the recovery partly to a sharp recovery in the oil sector, driven by an improvement in global prices and production volumes.

    The experts said that in addition, the non-oil sector recorded a positive growth for the second consecutive quarter, boosted by a strengthening of the broader manufacturing sector, reflecting impact of improved foreign exchange liquidity.

    In a report made available to The Nation, PwC experts led by Partner & Chief Economist,  Dr. Andrew S Nevin, said that besides the improvement in real GDP, the performance in other macro-indicators suggest that the economy is on track for a broad-based recovery.

    The report entitled: “Nigeria’s Q2’17 GDP: From Recession to Recovery” was a projection that Nigeria’s real GDP will attain full recovery by 2019, with growth moving closer to its long-term trend of 6.7 per cent.

    Latching on to the recovery trend, particularly in the manufacturing sector, manufacturers are renewing their clamour for increased patronage as a viable, credible and win-win strategy to sustain and strengthen the sector’s recovery process.

    At the forefront of the push is the President, Manufacturers Association of Nigeria (MAN), Dr. Frank Udemba Jacobs, who has identified the government as the largest single spender and could drive industrial development and economic growth by increasing its patronage of locally-made products.

    Jacobs, who spoke in Lagos at the 50th Annual General Meeting (AGM) of Ikeja Branch of MAN, appealed to the government to increase its patronage of made-in-Nigeria products, noting that this will boost the manufacturing sector, resulting to increased revenue to government through taxes and employment creation, among others.

    The AGM had as its theme: “Building a Competitive Manufacturing Sector: Road Map to Nigeria’s Economic Recovery”, with special emphasis on “Monetary and Fiscal Policy Measurers: Catalysts to Restoring the Growth of the Real Sector”.

    It offered a platform to review the activities of the branch, the performance of the manufacturing sector as well as the economy in the past year.

    Udemba, in his address at the AGM, noted the Federal Government’s efforts at reviewing the current Public Procurement Act (PPA) at the federal level and the introduction of the Executive Order on improved patronage of made-in-Nigeria products as well as the current build up against smuggling and counterfeiting activities in the country.

    The MAN president, who was represented by the Vice President of MAN, Lagos Zone, Rev. Isaac Ade Agoye, however, said it was pertinent to note that public procurement is not just mere purchases, but a strategic fiscal tool that has been used by other countries, including advanced nations, to develop their manufacturing sector.

    The Federal Government, through the Minister of Industry, Trade & Investment, Dr. Okechukwu Enelamah, announced that at least 40 per cent of government procurement spending will be on made-in-Nigeria goods and services.

    The minister also said the government was working at moving up 20 places up the ranking on the Ease of Doing Business index this year and it has to start from growing made in Nigeria.

    The development was sequel to the signing of three strategic Executive Orders by Vice President Yemi Osinbajo, when he held the forte for President Muhammadu Buhari, to promote patronage of made in Nigeria products, transparency and ease of doing business in Nigeria.

    Going forward, Enelamah said that any document issued by any Ministry, Department and Agency (MDA) for the solicitation of offers, bids, proposals or quotations for the supply or provision of goods and services shall expressly indicate preference to be granted to domestic manufacturers, contractors and service providers and the information required to establish the eligibility of a bid for such preference.

    All documents of solicitation shall require bidders or potential manufacturers, suppliers, contractors and consultants to provide a verifiable statement on the local content of the goods and services to be provided.

    Defining ‘local content’ as the amount of Nigerian or locally-produced human material resources utilised in the manufacture of goods and services, Enelamah said that made-in-Nigeria products shall be given overwhelming preference, or at least 40 per cent, of the procurement spent on locally manufactured goods and service providers.

    He listed some of the priority items to include: uniforms and footwear; food and beverages; motor vehicles; pharmaceuticals; construction materials; information and communication technology, furniture & fittings and stationery.

    The Nation, however, learnt that government agencies have not lived to the manufacturers’ expectations in their compliance with the Executive Oder on patronage of local goods and services.

    The MADs’ attitude has prompted the manufacturers and other private sector operators’ renewal of advocacy with the hope of getting more government patronage.

    Justifying the MAN’s position at the AGM, Jacobs said: “It is an established fact that when we buy foreign goods, we pay the returns to factors used in producing them in the originating countries; that is to say that we pay wages, rent, interest and profit to foreign countries with our local resources.”

    He said greater patronage of made-in-Nigeria products, on the other hand, will enhance the manufacturing sector and in turn, result to increased revenue to government through taxes. It will also reduce social vices as well as guarantee peace.

    The MAN chief specifically called on the Lagos State government to set a minimum percentage threshold for its purchases of made-in-Nigeria products.

    He said: “At the federal level, a 40 per cent minimum threshold of purchase has been fixed for Small and Medium Enterprises (SMEs) through the Executive Order One.

    “Also, we want you (Lagos State government) to give an acceptable Margin of Preference (MoP) of about 35 per cent in terms of price consideration for those products as against foreign ones.

    “This will mean that even if local products cost a little more than foreign ones, the local ones should be patronised within the set margin of preference,” Udemba said.

    According to him, this is in consideration of the prevailing high cost of the operating environment in and the need to keep local manufacturing companies in production. Besides, he said there is the need to retain jobs and create new ones.

    Udemba pleaded with Governor Akinwunmi Ambode and his colleagues in other states to ensure patronage of made-in-Nigeria products in their states’ procurement policies and processes.

    The thinking is that the made-in Nigeria campaign must be driven by all the states if the targeted objectives must be met.

    Not a few operators and stakeholders in the various sectors believe that if the made-in-Nigeria campaign must succeed, it should not be the challenge of the Federal Government alone; the 36 states must have a role to play.

    A voice for robust monetary, fiscal and exchange rate policies

    Prof. Ademola Oyejide of the Faculty of Social Science, University of Ibadan, who was guest lecturer at the AGM, noted that countries that have developed did so on the back of the productivity of the manufacturing sector.

    In his presentation entitled: “Monetary, Fiscal and Exchange Rate Policy Measures for Restoring Nigeria’s Real Sector Growth,” Oyejide said the manufacturing sector can only be productive and competitive with the appropriate mix of macroeconomic policies.

    According to him, having more than one exchange rate distorts the market and hurts the manufacturing sector.

    Dr. Okechukwu Kelikume of the Department of Economics, Lagos Business School (LBS), noted that indeed, Nigeria exited recession, starting from the second quarter of 2016, precisely February 2016, when oil price started moving up gradually.

    He, however, said that if the recovery momentum must be sustained and strengthened by riding on the back of the renewed campaign for patronage of local goods, it was important to ensure that “if we make policies, we must also stop distortions.”

    Citing the government’s policy to encourage local production of rice, the expert said it was critical to halt the distortion in the policy by way of halting the smuggling of the product.

    For instance, he said that at a time a bag of foreign rice cost about N13, 500, the price of a bag of local rice cost N17, 500. He said even though the policy to encourage local production of the product was in place, it made more economic sense for consumers to buy foreign rice because it was cheaper.

    Kelikume, who blamed it all on smuggling and high of doing business in the country, traced manufacturing contribution of a meagre 0.6 per cent to the GDP to the inability of the government to curb smuggling.

    Govt re-assures real sector operators

    In his remarks through the Commissioner for Commerce, Industry & Cooperatives, Prince Rotimi Ogunleye, who represented him at the AGM, Ambode said that his administration has intensified efforts at making the environment conducive for manufacturers and other private sector operators to thrive.

    He listed some of the efforts to include the state’s contribution to improving Nigeria’s rating on the World Bank’s Ease of Doing Business Index; automation of Lands Bureau to facilitate unhindered and smooth access to members of the public and other stakeholders who transact business with the institution; aggressive infrastructure development across the metropolis.

    Prof. Osinbajo had also assured that the Federal Government will not rest on its oars on improving the economy. He said the latest impressive ranking in the World Bank’s latest ‘Doing Business’ report, was an indication that the President Buhari-led administration’s reforms were producing results.In the World Bank report, Nigeria achieved the unprecedented step of climbing 24 places in the rankings, and earning a place on the list of 10 most improved economies in the world.Many stakeholders have described news as cheery for real sector operators, even as some of them argue that if government could complement this by increasing its patronage of locally made products, the current economic recovery momentum will be sustained and strengthened.Some operators who spoke with The Nation have advocated the urgency to address the lack of supportive infrastructure and challenging monetary and fiscal policy environment that weaken the manufacturing sector’s capacity to produce goods and services for local consumption.

  • Manufacturers disagree with LCCI over imported vehicles’ prices

    Manufacturers disagree with LCCI over imported vehicles’ prices

    The Nigerian Automotive Industry Development Plan (NAIDP) also known as automotive policy) has been described as the best thing to happen to the vehicle manufacturing sector since the early auto assembly plants were set up decades ago.

    Nigerian Automotive Manufacturers Association (NAMA) said this while reacting to the claim by Lagos Chamber of Commerce and Industry (LCCI) Director General Mr. Muda Yusuf, that the increase in prices of imported vehicles should be blamed on the auto policy.

    A statement by NAMA Executive Director Remi Olaofe, explained that NAIDP was introduced to reawaken the moribund assembly plants that were once operating at high capacity.

    This, he said, is to encourage major vehicle importers to attract their (foreign) Original Equipment Manufacturers (OEMs) to produce same in Nigeria.

    Olaofe argued that a simple market survey would confirm that as a direct consequence of the NAIDP, the prices of locally assembled vehicles are far lower than claimed by the LCCI DG.

    He said: “We were taken aback that a macro issue of the magnitude of prices of imported vehicles could be so narrowed to a single parameter like the National Auto Policy by a respected LCCI.

    “In coming up with the National Auto Policy, a number of issues were put into consideration with the pivot being to redirect the Nigerian economy from an over import dependent economy to a producing economy.

    “One of the greatest challenges facing the Nigerian economy has always been narrowed down to its overdependence on foreign goods with the attendant pressure on its foreign reserve and the exchange rate”.

    Olaofe said the initiatives are backed with incentives and disincentives to the local assemblers and Importers, respectively, which can come in form of variation of duties, tax holidays, and access to funds at cheaper interest rates, in favour of the former.

    Such incentives, he said, are not new, citing precedent with the textiles, furniture and food, sub-sectors, among many others, where policy makers went to the extent of placing some items of import on the “Not-Valid-for Foreign-Exchange-List”, in order to protect the local manufacturers.

  • ‘Manufacturers’ Guarantee will grow capacity’

    ‘Manufacturers’ Guarantee will grow capacity’

    •As consumers canvass Competition Bill to ensure quality

    The Manufactures Association of Nigeria (MAN) has been urged to incorporate ‘Manufacturers Guarantee’ in their products to assure the confidence of the public in their products.  It is believed that this will engender the patronage of such products in preference to imported products.

    Nigerians are known to ignore locally made products as a result of its doubtful quality and quantity, but elsewhere manufacturers give guarantee on what they produce and its efficacy and durability. Experts believe that except indigenous manufacturers move up the ladder in quality standards and attestation it may be a long while before they can be wholly accepted in preference to imported products.

    A Consumer advocate Mrs. Shola Salako- Ajulo who spoke at a Manufacturers Association of Nigeria (MAN) Forum on made-in- Nigeria goods in Lagos, canvassed the need for consumers to understand the opportunity cost of quality as against cost and the need to support products with the insignia of quality made by indigenous manufacturers.

    Further in her advocacy she canvassed the need to instill ‘Competition Bill’,  to check counterfeiting and the protection of every organisation’s products, marks and logos.

    Ajulo attested that there has been a lot of improvement in the quality of locally manufactured goods in the recent past arguing that what is needed most is for government to support these effort by providing the needed infrastructure to make the products competitive with imported ones.

    Earlier, MAN President, Dr. Frank Udemba Jacobs  regretted that indigenous manufacturers loose over three billion dollars to their taste for foreign goods  to the detriment of locally made goods. He said this culture is not limited to individuals but also government who should have put a strategy in place to curb this and grow the local economy. He lamented that over 800 firms shut down in three years and asked that government act quickly to stem the tide.

    He called for a 60 per cent home-bias in public procurement where locally produced goods and service will be given preference against their foreign alternative.

    He explained that in support of the campaign for Made-in-Nigeria goods, his association partnered ENABLE2, a DFID programme to drive home the message. He said the idea was aimed at improving the patronage of locally manufactured products by Nigerians, the government, Ministries, Departments and Agencies (MDAs) through an effective and inward looking Public Procurement process.

    On the success of the campaign, the MAN boss it has made reasonable progress and necessitated the call for the review of the current public procurement Act. Others are the introduction of the Executive Order, improved government patronage of ‘Made-in-Nigeria’ products and the current build up against smuggling and counterfeit activities in the economy.

    On the poor quality of locally made goods, the MAN president said most goods manufactured locally are of good quality but are counterfeited by some unscrupulous business men who go outside the country especially China to mass produce a cheap and poor quality look-alike to deceive consumers.

    On the advantages of buying locally made goods, he said it has the capacity to expand the industrial base of our country, create jobs and reduce the human misery brought about by poverty.

    On the success so far, he stated that before now the manufacturing sector had huge inventory of unsold  finished products occasioned partly by poor patronage of locally manufactured products by government, backlashes from smuggling and counterfeiting activities. Others are the general apathy of the consuming public towards locally produced products.

    On the choice of sectors on the advocacy campaign, he said it was based on Sector-Specific Margins of Preferences (MOP) such as the textile, wearing apparel, carpet, leather, footwear, chemical and pharmaceuticals. Others are pulp, paper, printing, publishing and wood products industry.

    He said: “Although the MOP for the five pilot sectors averaged 63 per cent, MAN suggests 35 per cent for starters, taking into cognizance of the tight financial position of the government at the moment.

  • Hard times await faulty ‘pure water’ producers

    Hard times await faulty ‘pure water’ producers

    Lagos sachet water manufacturers have been having a good time. HANNAH OJO writes that, sequel to a publication in The Nation on the dangers of contaminated sachet water brands; the Lagos State Water Regulatory Commission (LSWRC) has warned that it will raid faulty water service providers from  October 1

    Sachet water brands manufacturers who fail to comply with set standards for potable water production laid down by the Lagos State Water Regulatory Commission (LSWRC) will soon have their plants shut down, The Nation learnt.

    The Executive-Secretary, Lagos State Water Regulatory Commission, Mr Ahmed Kabiru Abdullahi, broke the news in his office in Alausa, Ikeja during an exclusive chat with The Nation.

    The development is sequel to a two-part investigation on contaminated sachet water brands in Lagos published in The Nation on August 19 and September 2.

    During the investigation, 30 samples of sachet water were randomly selected across various districts of the state. The water samples, selected between the months of May and August this year, were contracted to the University of Lagos Consult Limited for a laboratory test.

    The physical, chemical and microbiological characteristics of each sample were examined by a registered public analyst and chartered chemist from the Chemistry Department of the University of Lagos. The laboratory tests returned 15 faulted samples which showed presence of contaminants such as pathogenic coliforms, high microbial loads and acidity.

    Mr Abdullahi, who commended the report which he described as positive, said the state has zero-tolerance for water service providers who do not meet the hygiene status and safety parameters set for producers of potable water.

    “We have taken some water producers to court in the past. We have shut down the facilities of many, including prominent table water brands. We’ll start another raid from Sunday, October 1 and we shall prosecute defaulters who fail to comply with the laid down standards. Our officers are already going round and we are set for action,” he said.

    Abdullahi, who hinted on a stakeholders’ meeting to be convened soon to address challenges experienced by providers of water service also revealed that the agency would be collaborating with the Association of Table Water Producers (ATWAP) to fish out sachet water brands with fake addresses and registration numbers.

    A copy of the Investigative report was pasted on the LSWRC’s notice board in Alausa when the reporter visited.

    In a related development, Mrs. Clementina Ativie, the National President, Association of Table Water Producers (ATWAP) told The Nation that members of the association, led by the Lagos State chapter President, Alhaji Yisa Adeoye commenced an inspection of sachet water factories after the report was published.

    “At the moment, we have covered 20 zones and visited over 1,000 ‘pure water’ factories. We are checking each factory to examine the standard of their environment and to know if they have complied with the laid down rules and regulations with regard to hygiene. The visit was aimed at identifying genuine water producers and to ensure that citizens are not fed with poison.

    “We are also working towards ensuring that all water producers subject their water samples to a laboratory test at least three times in a year to examine the chemical and physical parameters”, she said.

    Ativie, who also revealed that the association would soon launch a coded symbol and number which would be used to fight fake water producers in the industry, stated that members of the association will not tolerate extortion from any quarter.

    Social media reactions, which trailed the publication of the story also suggested that the investigation should be extended to producers of bottled water and water service producers outside Lagos State.

    Ms Anu Onasanya, posted on twitter that factories with contaminated samples should be shut down by the government till their process can be revamped and vetted by the Ministry of Health.

     

    At risk of diseases and terminal illnesses

     

    Experts have maintained that besides water-borne diseases such as typhoid, diarrhea, cholera and hepatitis which people could contact by drinking contaminated packaged water, it can also expose the body to carcinogenic agents.

    The Nation learnt that the carcinogenic agents find their way into human body when the polythene bag used in packaging the water is of low quality and discharges dangerous agents into the water while being exposed to sunlight or stored in an unwholesome condition.

    Findings revealed that the drive for profit often makes many manufacturers of sachet water patronise low-quality polythene bags, which causes dissolution of chemical into the water.

    Interpreting the health implications of the contaminants found in the tested water samples, Mr Oluwole Adedeji, a Professor of Chemical Pathology at the Lagos State University Teaching Hospital (LASUTH), stated that low pH in water represents acidity.

    “pH is the concentration of hydrogen iron which represents acidity. The neutral pH is seven. Anything below seven is acidic. Anything above seven is basic and denotes alkalinity,” he said.

    The consultant also described the odour as a product of metabolism which shows some form of decay with grave implications for the human body if ingested through contaminated water.

    On the health implications of coliforms and other forms of pathogenic bacteria, he maintained that the coliform count in potable water should not go beyond a certain percentage.

    “Our intestines have what is called the resident coliform. But when immunity is reduced, they become a problem; adding more from outside means exposing the body to higher risks of toxic effects, especially when a person is stressed.

    “Most of these bags have pores. They have holes which may not be visible to the human eye, which allow some elements in the environment to diffuse gradually into the water. The chemicals can be very carcinogenic,” Prof Adedeji said as he connects poorly packaged sachet water with cancer and other terminal illnesses associated with the lungs, liver and the heart.

    Although there are strident measures laid down by regulatory agencies such as the National Agency for Food, Drug Administration and Control (NAFDAC) and the Lagos State Water Regulatory Commission; enforcement of these standards is not often adhered to, findings have revealed.

    With the acute water shortage in Lagos State owing to the inability of the state’s water corporation to supply potable water to majority of the residents, there is a high reliance on sachet water as a means of potable water by over 70 per cent of the citizens.

    In a twitter poll conducted by the reporter on potable water source for Lagos residents, 44 per cent of respondents chose sachet water as their source of potable water while 39 per cent chose boreholes.

    Another 12 per cent decided on bottled water and the lowest vote stands at six per cent, representing those who source potable water from the Lagos State Water Corporation.

    Majority of producers of sachet water interviewed by The Nation source their water from boreholes.

     

  • High Commissioner-designate assures local manufacturers of export facilitation

    High Commissioner-designate assures local manufacturers of export facilitation

    Nigeria High Commissioner-designate to the United Kingdom (UK) Justice George Adesola Oguntade has assured local manufacturers, especially in the agro-allied firms, of his commitment to enhancing export of their produce.

    The envoy-designate said the facilitation of export promotion  was top on his list of measures to strengthen the long-standing  bilateral trading ties between the Commonwealth partners.

    Justice Oguntade, a patron of the Cosmopolitan Women’s Club, who was hosted to a reception in Lagos over his appointment, said despite the setback of insecurity precipitated by insurgency, his reign would regain the lost investment  confidence in Nigeria.

    He noted  that he would focus on relieving Nigerians of the rising hardship being encountered at the commission in England.

    “Being an ambassador to the United Kingdom for me is a great challenge in the sense that I’m going when there is a lot of suffering and hardship in the land and when we keep hearing strange stories from our embassy in England. I pledge that on my trip to England, the first thing I want to concentrate is to ensure that as many goods as possible are exported to Britain so that we may be able to reform our economy.

    “Those who know how to manufacture garri, cassava should go ahead because these are troubling times for Nigeria and we must collectively come together to save the country,” he said.

    British Deputy High Commissioner to Nigeria Laura Beaufils, who hoped for a stronger cooperation under Justice Oguntade’s reign, said the United Kingdom was particularly concerned about honing the skills and talents of Nigerian youths through its robust educational platform.

    She added that the UK would be relentless in leveraging the strength and huge potentials in Nigeria to support its  growth.

    “There are so many areas of cooperation. Business is long and the opportunities are endless but one that is particular to me is our youth. Young people. We are incredibly lucky in the UK to have so many incredible talented Nigerian young people that to our universities are testament of the talent that exist here in Nigeria. I hope that partnership in education, especially in tertiary education, continue under your leadership.  I look forward to working with you very closely,” she said.

    Hailing Justice Oguntade’s meritorious contribution to Nigeria’s judicial system since 1966, the  Cosmopolitan Women’s Club President, Chief Adeorike Durosinmi-Etti said Justice Oguntade would deliver the good mandate of defending the cause of Nigeria and Nigerians in the UK.

    Nigeria-British Chamber of Commerce President Akin Olawore said the chamber would support the high commissioner-designate.

  • Manufacturers hail introduction of product authentication scheme

    Manufacturers hail introduction of product authentication scheme

    The Manufacturers Association of Nigeria (MAN) has thrown its weight behind Standards Organisation of Nigeria (SON)’s plan to introduce a product authentication scheme, saying it is in the interest of manufacturers and consumers.

    MAN President Dr. Franks Udemba Jacobs made manufacturers’ position known during a consultative meeting with SON Director-General Mr. Osita Aboloma, in Lagos.

    According to him, the introduction of such scheme to assure the quality of products on offer to consumers in  the country is long overdue, given the negative economic effect of faking, cloning and counterfeiting, particularly on certified local products.

    Jacobs decried the situation where a product is supposedly doing so well in the market without its manufacturer reaping the benefits of his investment due to faking, cloning and counterfeiting, while consumers also get short changed in the process.

    The MAN President acknowledged the huge responsibility that the mandate of SON confers on the organisation, particularly the need to assist local manufacturers excel on a continual basis in order to grow the nation’s economy and provide gainful employment to its youths.

    He alluded to the need for all relevant agencies of government to harmonise their activities at the country’s entry points in order to effectively fight the influx of substandard products into the country.

    The MAN chief stressed that the continuous influx of substandard products into the country was negatively affecting manufacturers in particular.

    This, according to him, underscored the need for SON’s active involvement in the execution of the  Presidential Executive Orders, to assure the quality of all imports.

    MAN Director-General, Mr. Segun Ajayi, said the association’s members across the nation look up to SON for the provision of relevant and up to date standards.

    According to him, availing the expertise of SON personnel to manufacturers will ensure continual improvement in the competitiveness of their products for local consumption and export.

    He commended the existing robust collaboration between the two organisations, which according to him, has always provided avenues for clarifying issues of mutual concern.

    Earlier, Aboloma described MAN members as strategic to standardisation and quality assurance in Nigeria. He said this necessitated the consultative meeting  by SON.

    The SON DG said a product authentication scheme would be introduced to assist consumers confirm the genuineness of products before purchase to have value for their money.

    Other advantages of the scheme, according to him, include assurance to genuine manufacturers and importers of their products on sale.

    Abaloma said the product authentication scheme would effectively fight the cloning, faking and counterfeiting of genuine products by providing necessary information to guide consumers’ purchase decisions in the market.

    “Without patronage, the purveyors of substandard, faked, cloned and counterfeited products would have no market for their products” he said.

    Aboloma said SON had engaged an international security printing outfit on the implementation of the scheme, leveraging its vast experience.

    The SON DG announced that the organisation will soon embark on stakeholders’ sensitisation on the product authentication scheme across the country to ensure that stakeholders were carried along in the implementation in line with World Trade Organisation (WTO) requirements.

    Aboloma enumerated several initiatives of SON to provide level playing field for local manufacturers and importers in line with WTO’s requirements of which Nigeria is a signatory.

    Some of them include the Mandatory Conformity Assessment Program (MANCAP) to assure the quality and competitiveness of all locally- manufactured products and the off-shore Conformity Assessment Program (SONCAP) for imported products.

    He also said the electronic product registration scheme was aimed at products traceability and confirmation of quality status.

  • ‘Paints manufacturers face tough times’

    The Group Managing Director/ Chief Executive Officer of Chemstar Paints Industry Nigeria Limited, manufacturers of Finecoat and Shield Paints, Aderemi Awode, has said the last three years have been very tough and challenging for the paints industry in the country.

    He attributed this to the high rate of foreign exchange, given the fact that over 60 per cent of the raw materials are imported, and coupled with the low disposable income of the people.

    Speaking in Lagos at the company’s 2017 GMD/CEO Annual Merit Award, (GAMA), he said despite the challenges, Chemstar Paints Industry found it extremely imperative to reward its outstanding and long time members of staff.

    According to him, “For the paints industry, it has been so tough and challenging in the last three years. The high rate of foreign exchange and low income of Nigerians, even though paints are the last in the chains of people’s demand, have affected our capacity utilisation.

    “So also, the issue of power in the country remains unresolved and which we rely mostly on diesel to power our generators. However, we still keep running the company without meaningful profit in the last three years.”

    He said he was particularly impressed with the passion and commitment of the staff towards competition and growth of the company, adding that the annual competition was introduced few years ago to reward hard working staff.

    Winners of various competitions and raffle draw smiled home with cash reward and gift items including plaques, medals, home theatres, refrigerators, generators, LED plasma TVs, DVD players, GOtv decoders, blenders, electric kettles and host of others.

    The 2017 GAMA Best Staff, Kehinde Oriyombo Adenuga, who has served the company meritoriously for 12 years, was lauded by the GMD and management of the company for his worthy service, which earned him the award.

  • Manufacturers spend N378b on power generation in three years

    Manufacturers spend N378b on power generation in three years

    Manufacturers have expended over N378billion on power generation to run their operations in the last three years, the President of the Manufacturers Association of Nigeria (MAN) Dr Frank Udemba Jacobs said.

    This is due largely to unreliable public grid power supply across the country.

    According to MAN boss, manufacturers of consumable and non-consumable products spends N126billion yearly to generate power, lamenting that the figure amounted to N378billion when multiplied by three years.

    He said the small, medium enterprises (SMEs) and multinational companies have, during the years under review, invested substantially in gas, coal and diesel to power their operations to remain in business just as he noted that gas, coal and diesel have become veritable means of providing power to the manufacturing sector.

    He said foreign-owned companies operating in the country are beginning to see the sense in investing in thermal plants in order to generate electricity as against a situation where they would be relying on power from the national grid.

    Jacobs said: “The dwindling power supply occasioned by poor generation is having undesirable effects on the nation’s manufacturing industry. Besides the fact that capacity utilisation in the sector has reduced as many manufacturing concerns have either downsized or right-sized in order to cut down the cost of operation, the development has resulted in the low production of goods. In order to boost operation, small, medium and bigger manufacturing companies decided to generate their own electricity using gas, coal and diesel.”

    He said MAN has over 2,000 members out of which a sizeable number of manufacturers are using generators as a major means of providing power to their factories at a huge cost. Power supply from the national grid has become an alternative, he lamented.

    On diesel, Jacobs said the decision by the federal government to crash the price of diesel by 43 per cent to N160 per litre from about N300 per litre, is laudable.

    He said diesel is the major source of providing electricity in the sector, adding that bringing the price down by the Nigerian National Petroleum Corporation (NNPC) is heartwarming.

    “The issue of reducing the price of diesel to N160 per litre by the government has delighted both private and non- private sector operators as the idea would help in reducing the cost of operation and increase growth and productivity,” he added.

    Power, he said, drives modern economies globally, stressing that the only way to improve the contributions of both the oil and non-oil sectors of the economy to the Gross Domestic Product (GDP), is to develop the power sector.

     

  • ‘Manufacturers can’t survive 20 to 30% interest rate’

    ‘Manufacturers can’t survive 20 to 30% interest rate’

    Sona Agro Allied Foods Limited, a biscuit manufacturing company and subsidiary of Sona Group of Industries, has exported its products to Ghana and other West African countries. In this interview with OKWY IROEGBU-CHIKEZIE, its Chairman, Mr. Arjan Mirchandani, says the company achieved this feat because it sources over 90 per cent of its raw materials locally. He also says there is a need to encourage indigeneous industries with cheaper funds and favourable policies, urging the government to engage more with local manufacturers.

    What is the significance of the inauguration of Sona Agro Allied Foods export?

    The significance it supports  the government’s policy on backward integration and local farmers. It is important to help farmers. We believe they are the future of this country. We also believe that aside farmers, Nigerians can decide their future. It is not the business of any foreigner to decide the future for Nigerians. Foreigners could bring investments, technology and all the talents to make sure goods produced here are comparable to those from Europe and the United States, so that at the end of the day, one can take the products to other markets not only within Africa. It is necessary  to look at the opportunities. This is one of the reasons we started this journey using local raw materials.

    We started with just two containers for export, which in our estimation equals 200 containers, because when one has faith and takes a step at a time, one will reach one’s goal. Nigeria has an opportunity to grow, and to replace all imports with locally-manufactured goods and save foreign exchange. We cannot rely only on oil money. When you have too much of oil money, people get spoilt; when you have little, you start looking at what you have at home. Thus, taking one step is better than not starting at all.

    What drives you as a businessman?

    Every step we have taken has been guided by God. It is also our belief that you don’t ask your country what it will do for you, but what you can do for it. We make sure that we do our part for the society.

    Many companies have been affected by the economic downturn, with some either downsizing or producing at less than installed capacity. What has been your solution to this crisis?

    Probably. companies that are downsising were not able to get their acts together. Banks are also not helping the sector as their interest rates are between 20 and 30 per cent, which no manufacturer can survive on. With an interest rate of that nature, no business can survive. In India and other countries, interest rates are two, three or four per cent maximum. In Switzerland, you will get money at one per cent rate. When you have cheap money, you are encouraged to invest more. Nevertheless, we are still expanding, with no reason to downsize and deny workers their livelihood; we are doing everything possible to keep our staff even in the toughest season.

    How do you comply with quality standards, especially getting certification from the regulatory bodies?

    We adhere to quality standards in our production processes and have obtained certification from the International Organisation for Standardisation. We have complied with all the regulations from the Standards Organisation of Nigeria  (SON), National Agency for Food and Drug Administration and Control (NAFDAC) and other government agencies. We are a responsible company and we are encouraged, despite the situation which makes us to be bringing in newer technologies. We are working with the Bank of Industry (BoI) and the International Institute of Tropical Agriculture to achieve this. We are grateful to some of these government agencies because they encourage growth in investments. If the cost of funds is not made cheaper more industries will die in Nigeria. I don’t believe that should mortgage the future of the country. We should encourage local industries that source raw materials locally.  Nigeria got her independence in 1960, but we are not free until we are free by being self-sufficient. We need to start immediately.

    How should the government assist investors?

    We want the Federal Government to make cheaper loans available for the industries. We also believe that government officials should visit industries more often and encourage them, especially during moments of difficulties. It is the duty of every one of us to join hands together to grow Nigeria. That is why we think the Federal Government needs to engage manufacturers and ask them what their problems are. We have written many letters but we don’t get response from the government and this is very unfortunate. At Sona Group of Companies, we are producing with 100 per cent local raw materials, yet the Federal Government allows people to import commodities that can be sourced locally and they are charged only five per cent duties. For instance, some people are importing sorghum when we have enough of it in the country. We need to make policies to support local companies.

    What are your investment plans?

    At Sona Agro Allied Foods, we’ll like to see 100 per cent capacity utilisation. In the next 15 months, we are hoping to grow by 200 per cent. We feel that import reduction and government’s policies are helping to grow the industries and so automatically, employment will grow and the ordinary Nigerians will be proud that he is contributing to the growth of the economy. We have thousands of vibrant Nigerians in our work force and they are doing well.

    What efforts are you making to ensure proper branding of your products to make them more acceptable in the market?

    Great products are made of great quality. If you don’t do quality but you have great packaging, you won’t sell. The customer must get value for his money. Our belief is that people must get value for their money. That is important for us and we have obligation to our customers. We are also not relenting in our efforts to promote the products by building awareness.

    What is unique about your products?

    We are not doing anything extraordinary, but one thing I know is that when you produce quality goods, you don’t have to show off. Consumers themselves will determine what the market of the products should be.

    Which of your subsidiaries is your flagship and what are the different market shares of your firms?

    There is no discrimination in our organisation. Our industry is viable based on availability of local raw materials. I am all for it and I will do whatever it takes to replace imported products. Daily, we put millions of products into the market and we make sure that no problem or complaint comes to us because of our products. And we also pay close attention to our customers because we believe that the customer is always right and we ensure we give them value for money.