Manufacturers Association of Nigeria (MAN) has expressed concern over the unwarranted and ill-timed sealing of some industries in Lagos State.
MAN stated this in an open message to the Lagos State Governor Babajide Sanwo-Olu, as all attempts at approaching the relevant heads of Agencies and Ministry have failed.
The association decried the action of the Lagos State Water Regulatory Commission (LASWARCO) in sealing factories over their alleged refusal to pay the “astronomical and unjustifiable water abstraction fees charged by the commission.”
MAN said, “This action is ill-timed and quite unfortunate, as the Commission and MAN had engaged in meaningful dialogue and reached some agreements over the lingering issue about three months ago.”
Director-general of MAN, Segun Ajayi-Kadir said that “this was expected to culminate in an MoU to commence in January 2025. Only three weeks ago, another round of discussions took place between LASWARCO and representatives of MAN, including affected member companies, which led to ongoing discussions in the companies as to the most viable option for addressing the alleged outstanding payments from earlier contested fees. It is while these discussions were going on and during the Yuletide that the Commission decided to cause this major and unwise shut down of the companies.”
He noted that “it is important to properly situate this inappropriate action within the context of the prevailing incumbent operating environment in general and the downturn in the manufacturing sector in particular.
A situation where industries are burdened with payments in excess of N100 million for generating water for production purposes, in the face of the government’s failure to supply the same, is unfair.
“The exorbitant fees and the untoward means of extracting payment exemplifies the negative impact of tyranny of regulation on private business. To date, manufacturers across the country are saddled with more than N1.2 billion of unsold inventory, borrowing at more than 30 per cent and struggling under a debilitating 250 per cent increase in the cost of power.”
Ajayi-Kadir added that numerous taxes, fees and levies by the three tiers of government and non-state actors in some cases, numbering between 60 to 120 confront each manufacturer, not to mention the disruption of production activities due to insecurity and high cost of logistics.
He pointed out that this oppressive water abstraction fee in Lagos state that may potentially be adopted by other States, presents an ominous and rancorous future for manufacturers in particular and private businesses in general, saying that MAN implores the Governor of Lagos state to use his good office to order the immediate reopening of the closed factories.
“This will pave the way for a logical and passable conclusion of the ongoing conversations on how to permanently resolve the matter of outstanding fees, as well as conclude the impending MoU between the Water Commission and the Organised Private Sector,” he stated.
“The possible loss of jobs and its attendant socioeconomic implications, as well as the negative signal to the investing public should serve as a deterrent and encourage a business-friendly regulatory environment,” he lamented.
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