FG Urged To Set Up Manufacturers’ Bank

Federal government has been urged to establish a manufacturer’s bank in Nigeria to meet the needs of local producers.

The president of MAN, Francis Meshioye, made the plea yesterday in Abuja when he presented the Manufacturers CEOs Confidence Index 2024.

Meshioye said, “The manufacturing sector is a peculiar sector that requires a specialized bank like we have for the Bank of Agriculture and the Bank of Industry.”

He emphasised that the manufacturing sector is unique and requires a specialized bank for easy access to funds.

He noted that commercial banks prefer to lend to traders rather than manufacturers because traders can recoup the loan through daily sales.

He, however, advised that if the federal government cannot establish a bank for manufacturers, it could establish manufacturer desks in commercial banks with consultants to guide them on the peculiarities of the manufacturing sector and the interventions required to revive the sector in terms of funding.

“The consultants will also fashion out modalities for the loan recovery,” he said.

For his part, the director of research and advocacy, Oluwasegun Osidipe, analyzed the 2024 MCCI and said manufacturers were forced to cut production and jobs in the first quarter of the year due to macroeconomic-related headwinds.

He said that despite slight optimism, which saw MCCI points record a marginal increase above the 50-point confidence threshold, current business conditions and employment remained low, below 50 points.

He said MAN associated this with the lingering effects of rising inflation, escalated energy prices, exchange rate instability, and customs duty rates.

He said that according to the report, production and distribution costs surged further by 20 percent in the first quarter of 2024, while capacity utilization declined further by 9.7 percent.

“The production volume slid further by 10.14 percent in Q1 2024 from a contraction of 4.6 percent recorded in the previous quarter.

“Manufacturing employment further declined by 5.27 percent in Q1 from the 4.46 percent contraction recorded in the preceding quarter.”