We can’t compete with invading Chinese manufacturers

…Demands 3% interest rate, power, others

The Nigerian manufacturers have made it clear they cannot compete with invading Chinese manufacturers because of what they termed huge disparity between both economies, especially very high interest rates and high cost of power in Nigeria.

The position was tabled by Ifeanyi Okoye, the newly installed President of the Manufactures Association of Nigeria (MAN), while the urging by policy makers that Nigerian producers should be able to compete with the Chinese that have begun moving into Africa, especially Nigeria.

Okoye spoke in Port Harcourt while opening the MAN Rivers/Bayelsa Annual General Conference.

He said Nigerian manufacturers are challenged at a recent meeting (at the NESG) to match the Chinese.

He said the official from a financing institution at the event had asked why Chinese producers would come and build fantastic industries in Nigeria while the locals looked on.

The MAN boss, however, challenged the Government to give Nigerian manufacturers loans at same 3% like the Chinese get back home and see what the Nigerians can do.

He said Nigerians cannot be expected to obtain loans at about 36% and compete with those working with 3% interest. He said: “Give loans at 3% and see what we can do, in any sector.”

He also mentioned power supply, which he said takes a chunk of up to 48% of cost of production. Okoye, who is the 12 President of MAN, who is from the South-East, including South-South, narrated how he went to visit a friend’s factory in Port Harcourt on Wednesday only to meet them running on diesel.

He said no manufacturer cannot survive with darkness or buying fuel at N,2000 per litre

He revealed how he suffered embarrassment at NESG when the CEO of the financing body told the world that interest rates were nose-diving in the past one year. Okoye said he stood up and debunked such claim because interest rate was ever going up.

He said he was a panelist and was asked what manufacturers could do for Nigeria if they could get loans with low interest rates and all other things in terms of finance.

Okoye said: “Irrespective of the fact that banks were restructured and recapitalised, but it’s like the recapitalisation meant increasing interest rates for manufacturers.”

The MAN President told the Government at the event: “Give me 3% interest, forget the type of industry I will build. Can any bank in Nigeria give you 10% interest? Even BOI will give you at 9%, but on the condition that it is only to buy machines, and they will follow you from your doorstep to where you’re buying the machine, follow you back, see the machine installed, and watch you operate it.

“In this case, the Chinese coming to Nigeria will receive as little as 3% interest rate, and when they come into Nigeria, what else do you expect? They will build whatever is worth building and they will operate at a huge advantage.”

He also harped on operating environment especially taxes, and said: “We need tax incentives. Tax must reward those that create jobs, export, and use local raw materials. That is what tax is supposed to do, most especially for manufacturers.”

Okoye commended the Rivers and Bayelsa State Governments for what they had tried to do so far to encourage manufacturing but noted that more is needed. He expressed surprise that no single Government official from any of the two host States was physically present at the AGM, but accepted the excuse that they were all occupied by election campaigns.

Earlier, Vincent Okuku, the host chapter Chairman, who said this was his last AGM as chairman, reflected on what he called a tenure full of achievements such as 800% revenue boost, upgrading of the MAN secretariat, improving the institutional image and administrative capacity of the branch. “We have also acquired a branch bus, strengthening engagement with government and other business organisations.

“Our participation in the Rivers State Committee on Export Promotion, engagement with the Bayelsa State Ministry of Trade, Industry and Investment, and collaboration with the Rivers State Investment Promotion Agency for a dedicated industrial park reflect our commitment to ensuring manufacturers have a stronger voice in decisions affecting their businesses.”

Many topics were lined up at the well-attended AGM with technical papers from finance institutions, manufacturers, and other experts.