National Telescope national telescope newspaper
The Manufacturers Association of Nigeria has explained the rationale behind the deat of 767 manufacturing companies in Nigeria in 2023.
According to the group the continued volatility of the exchange rate, rising inflation and other economic challenges have worsened the investment climate.
It added that, no fewer than 335 became distressed in 2023.
MAN in a statement on Tuesday kicked against the recently introduced Expatriate Employment Levy by the Federal Government, saying it runs against the ‘Renewed Hope Agenda’ as promised by President Bola Tinubu and the core of his Fiscal Policy and Tax Reform initiative.
The statement read in part, “The imposition of EEL poses a potential impact on the manufacturing sector and the economy at large.
“This will in turn mark an unwarranted and unprecedented addition to the cost of doing business in Nigeria, especially to manufacturers. The manufacturing sector is already beset with multidimensional challenges. In the year 2023, 335 manufacturing companies became distressed and 767 shut down.”
It stated further that capacity utilisation in the sector has declined to 56 per cent amid rising interest rates and scarcity of forex needed to import raw materials and machinery. Adding that, ““Inventory of unsold finished products has increased to N350bn and the real growth has dropped to 2.4 per cent.
“We are equally worried that the imposition of such a levy could have far-reaching implications for our national economy and potentially exert pressure on our national currency could be introduced through a Handbook, rather than a law enacted by the National Assembly.
It stated that if the levy is not reversed, it might expose the Federal Government to a plethora of lawsuits that would distract Government from the task of salvaging the current situation of the economy.
