The President of the Manufacturers Association of Nigeria (MAN), Alhaji Mohammed Borodo has identified energy as the major scourge of the sector even as he maintained that, “the only way to re-position and move manufacturing sector forward in Nigeria is through independent power supply.”

•Mohammed Borodo Photo : Sun News Publishing

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Borodo disclosed that his team has plans to establish a 125 megawatts of Independent Power Project (IPP) with the Ogun and Lagos State industrial area. The plant, he said, would take care of the power supply to member companies. The project he said is estimated to cost a princely $125 million.

Excerpts:

The establishment of IPP

As far as the manufacturing sector is concerned, we are the biggest consumer of power in the country. We are also the biggest customers to the Power Holding Company of Nigeria (PHCN) and our members pay their bills. There is no special secret about the establishment of IPP by MAN. Rather, we think that it is a necessity to provide an independent power supply to our members because of what they are going through in the hands of public power supply. Moreso, it will be our modest contribution towards the development of our country. We will keep on supporting this country in whatever way we can so as to move the economy forward.

Challenges facing the project

One major problem facing the project is finance. We are looking at one million dollars per megawatt, so we are trying to start with 125 megawatt plant for now. That is about $125 million is needed. We have done the demand audit to know our members consumtion needs and how much of it that is coming from PHCN, how much of it that is coming from their own generators and the projection for the next five years. We have done all that. The greatest challenge now is that we have to invest 20-30 per cent of the total cost of the project before banks can take over its financing through a long-term loan which you know is not an easy one. But we are trying our best to raise this money to finance the project. There is no way we can operate without adequate power supply. We need it just as we need raw materials for production.

Major challenges facing the real sector

Well the major challenge facing our industries is power supply. Another thing is implementation of industrial policy. We have all the policies in place, but to carry them out is a problem. Therefore, as a nation, we need to have focus to achieve industrial growth which should be more profitable to us.

MAN and these challenges

As I said earlier, we, in MAN, are aware of the problems facing the real sector. So, we are promoting the independent power project to alleviate the hardship of the manufacturers. We also believe that an improvement in the industrial sector will bring economic growth in the country.

Why Nigerian products are uncompetitive

In the 70’s and 80’s, there was tremendous growth in Nigeria’s real sector. Then came SAP, which affected the cost of imported raw materials, the purchasing power of Nigerians reduced or even collapsed. It was this period the Naira went up from one Dollar to hundred Naira . And this has made the cost of raw materials to escalate. Recently, IMF reported that Nigerian industries paid six times more for energy than their counterpart in the far East. Against this bottlenecks, you will not be surprised that Nigerian industries are almost collapsing and this is not good for the economy.

Is Vision 2020 feasible?

I think it is possible. You are talking of 12 years from now. If the present government could provide infrastructure such as energy, transportation and good communication, we have the chance of being among the top 20 industrialized nations in the world. Maybe by 2030, you will have sustained growth in the economy which is a good one for the country.

Infrastructure deficiency

Infrastructural deficiency especially the railway has affected many of our members. There is no proper railway system in the country. Imagine if one wants to move a cargo of 2,000 tonnes , it is preferable to put it on a railway. But we don’t have such for now. Even when one tries to move it through the road, the roads are very bad. We hope that the government will address these problems to make life more meaningful for the people.

Standard of goods

Recently, we had the privilege of hosting Consul- General of China, and we discussed extensively on substandard goods coming from that country to Nigeria. We highlighted our misgivings about some of these product. They promised that they will look into it but they also said that it is a two way affair. For some of the problems, you cannot blame only the Chinese producers or exporters but also Nigeria importers, who go there and ask the manufacturers to produce substandard goods for them. And this is one area we are collaborating with NDLEA, SON and other regulatory bodies who are able to check this menace in the country. we believe that various government agencies assigned with these responsibilities are capable of tracking down these importers and bringing sanity into the system.

Patronage of locally made goods

I think, it is an accepted policy now that government, in its procurement, should patronize the locally manufactured goods. I think there is a good level of compliance in government parastatals.

Several Nigerians have been encouraged by MAN in one way or the other to patronize Nigeria made goods and I want to say here that until we begin to appreciate goods made in this country, we may never have a stable economy that is capable of transforming Nigeria into a highly industrialized nation. Most manufacturing firm are closing down because of lack of patronage from Nigerians.

I believe the manufacturers are not doing badly in terms of producing high quality products. Our products in this country can compete in term of standards with others anywhere in the world.

Bank of industry and manufacturers

The Bank of Industry (BOI) formerly known as Nigeria Development Bank have been a catalyst to the development of industries in the country. When it metamorphosed into Bank of Industry with a capitalization of N50 billion, it would have been able to meet the financial needs of the industries then. But the industries this money is meant for could not receive any financial assistance from BOI. As we can see, it is an important institution to the Nigeria industry that could transform the country into an industrialized nation if it was well established. We hope that the Federal Government will re-capitalize it to meet the needs of the industrial sector.

One year of President Yar’Adua

First, we are happy and pleased that we had a peaceful transition. Second, I admire President Yar’Adua for the quality of the people he had put in the economy. They are the caliber that will deliver, I respect him for that.

I also appreciate that Nigerians are generally impatient, they want quick result and I as well appreciate that he is a thorough person, he looks before he leaps. I hope that we may have to be more patient with him. I believe he is an honest man who believes in the rule of law. This will go a long way to cleanse the society from corruption and better the lot of Nigerians in general.

Message to members

My message to my colleagues in the manufacturing sector is that there is hope. We are the greatest country in Africa. It is a privilege to participate in the industrialization of this great nation. I appeal to many, I believe we have seen the worst, we expect things to change for the better for all of us.