THISDAY

MAN: Border Closure Raised Manufactur­ers’ Production Value by 42%

- Dike Onwuamaeze ECONOMY

The marginally favourable performanc­e recorded by the Nigerian manufactur­ing sector in the second half of the 2019 has been attributed largely to the border closure announced by the federal government last year.

During the period under review, the Manufactur­ing Production Value (MPV) of the Nigerian manufactur­ing sector grew by N2.77 trillion in the second half of 2019, which represente­d 41.8 per cent increase when compared to its performanc­e within the same period in 2018.

This was revealed in the Manufactur­ers Associatio­n of Nigeria (MAN) Economic Review of the Second Half of 2019, which stated that “the increase in manufactur­ing production within the period was ascribable to improved volume of activity in some sectors on account of the border closure and the relative tranquilit­y in the foreign exchange market.”

In addition, the review also showed that in the second half of 2019, inventory of unsold finished manufactur­ed goods dropped marginally in the sector to at N202.16 billion, down by N23.73 billion (10.5 percent) when compared with N225.89 billion recorded in the correspond­ing half of 2018.

“The developmen­t can have attributed to the closure of land borders of the country within the ECOWAS regions which made Nigerians resulting to the purchase more of locally manufactur­ed goods in the period,” said MAN.

Furthermor­e, the report showed that the border closure had a positive impact on local sourcing of raw materials by Nigerian manufactur­ers.

“The utilisatio­n of local rawmateria­ls in the manufactur­ing sector increased marginally in the second half of 2019, attributab­le to the closure of the country’s land borders by the federal government in the year. This is found impressive particular­ly coming on the back of a decline in local sourcing of raw materials in the sector.

“In the second half of 2019, Local sourcing of raw-materials in the manufactur­ing sector increased to 64 per cent from 63.7 per cent recorded in the correspond­ing half of 2018; thus representi­ng 0.3 percentage point increase over the period. It also indicates an increase of 7.0 percentage point when compared with 57.0 per cent recorded in the first half of 2019.

“Local raw-materials utilisatio­n in the manufactur­ing sector averaged 60.5 per cent in 2019; representi­ng 0.02 percentage point decline when compared with 60.3 per cent recorded in 2018,” the report stated.

It also showed that production value totaled N11.99 trillion in 2019 as against N9.98 trillion recorded in the 2018, which represente­d N 2.01 trillion or 20.1 percent increase over the period.

The MAN’s economic review, which was released during the weekend, said that in “the second half of 2019, manufactur­ing production value stood at N7.38 trillion as against N5.22 trillion recorded in the correspond­ing half of 2018; thus indicating N2.16 trillion or 41.8 percent increase over the period.”

Similarly, it increased by N2.77 trillion or 60 percent when compared with N4.61 trillion recorded in the first half of 2019.

Moreover, the review also indicated that manufactur­ers’ confidence in the economy also grew marginally in 2019.

The reviews perception index that surveyed more than 400 companies in Nigeria for the fourth quarter of 2019 disclosed that the Chief Executive Officers’ (CEOs) perception of the Nigerian economy stood at 51.9 per cent in fourth sector.

Previously, the CEOs’ perception index was 51.7, 50.9 and 51.3 point in the third, second and first quarters of 2019 respective­ly. It also showed that the food,

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