Local industries in Nigeria closing shops daily- Manufacturer …Says FG reforms not making positive impact …Over 500 workers with 5 industries back to labour market

Spread the news


Local industries in Nigeria closing shops daily- Manufacturer

.Says FG reforms not making positive impact

.Over 500 workers with 5 industries back to labour market

 By Udeme Clement & Faith Idem

The Stellarchem CEO:

The Chairman, Toiletries/Cosmetics Group of the Manufacturers Association of Nigeria, (T&C Group of MAN), Mr. Ikpong Umoh, has disclosed that over 500 workers with local industries were recently thrown back to the labour market, as over five industries closed shops recently due to non-availability of raw materials and harsh operating environment.

Mr. Umoh, who is also a manufacturer and the Chief Executive Officer of Stellarchem Nigeria Limited, revealed this in a chat with Financial Business Correspondents in Lagos.

He expressed strong displeasure about numerous challenges facing local manufacturing companies in the country, especially cosmetics’ industries.

He lamented, “The industry is very challenging because of the election year. At present, the Federal Government is focused on elections, not on the economy, or the growth of Small and Medium Enterprises, SMEs. Everything in Nigeria now is about 2019 elections. As such, the purchasing power is very low, as the people, who are the consumers do not have the money to spend”.

He stressed, “At present, over five of our members just closed their companies throwing over 500 workers back to the labour market. In fact, the reforms by government to enhance industrial growth are not making positive impact on manufacturing sector of the economy, especially toiletries and cosmetics.”

The Stellarchem boss pointed out, “Giving a brief overview of activities in the industry last year, we have seen that no tangible growth was recorded in 2018 fiscal year. For example, the contribution of manufacturing sector to Gross Domestic Product, GDP, is less than 9 percent. As I said earlier, many of our members closed their companies due to non-availability of raw materials, as heavy import duty is placed on these materials, which are not manufactured in Nigeria.

“Now, under the tariff code of ‘3402’, we pay as much as 20 percent duty plus additional 5 percent Value Added Tax, VAT, making 25 percent, just to bring in raw materials for manufacturing.

“Other factors militating against growth of SMEs include lack of easy access to funds and dearth of infrastructure among other challenges. Access to funds for expansion is very problematic because banks are not giving us loans. Even the newly established Development Bank of Nigeria has not given clear guidelines on how SMEs can benefit from its funds”.

His words, “Also, the crisis in some parts of the country is affecting our business. Many of our members who operated depots in Jos, Zamfara, Sokoto, Gombe, Nasarawa States and other crisis prone areas had closed them because of insecurity there”.

On positive steps taken by stakeholders in the sector, he enthused, “We met and discussed directly with the Minister of Industry and Investment, making our plight known to the Minister. We equally discussed with Standards Organisation of Nigeria, SON, on their regulatory framework, to understand why Toiletries/Cosmetics must not be subjected to double regulation of MANCAP assessment by SON.

Well, if they have accepted it or not, we do not know. But since that meeting, SON officials are not harassing our members”.

Mr. Umoh…   Industrial development in his mind:


Segment-Two report:

Watch out for more details on our subsequent reports.

About Post Author

error: Content is protected !!