Leading industrialists in the country have described some policies of the federal and state governments as undermining efforts by investors to boost manufacturing sector and called for an urgent review of such policies.
This was one of the consensual point of views of industrialists at the 10th edition of the Manufacturers Association of Nigeria (MAN) CEOs and Managing Directors of member-companies’ Breakfast Meeting held Thursday in Lagos.
The meeting had as its theme ‘The Nigerian Manufacturing Sector: Current Issues and Strategic Options with special emphasis on The Impact of Legislation, Regulations and Policies on the Ease of Doing Business in Nigeria’.
Specifically, the industrialists picked holes in some recent policies, adding that the “unprogressive regulations and policies” and complexities caused by revenue drive by the three tiers of government are negatively affecting the confidence of the nation’s business community on the ease of doing business initiative.
For instance, the chairman of the Ikeja Branch of MAN, Otunba Francis Meshioye, pointed out that the fiscal policies’ regulatory burden on manufacturers was undermining the manufacturing sector’s ability to launch new businesses, expand existing ones, and create jobs.
Meshioye, who spoke elaboraetely on the fiscal constraints facing industrialists, pointed out that the governments’ policies and other reactionary interventions by the federal and state governments negated the objectives of the ease of doing business initiative.”
The industrialist lamented that despite being the engine of economic growth, the manufacturing sector appeared to be under a fiscal siege, adding that “it is as if politicians and regulators want the sector to collapse.”
Noting that the economy technically exited recession in the second quarter of last year, the Ikeja MAN chief expressed concern that economy still remained largely volatile, with the manufacturing sector in Lagos still battling to survive the myriad of policy-induced challenges.
He listed some of the challenges to include difficulties created by the bottlenecks in the implementation of the harmonised inspection of workshops, increase in business taxes, levies and fees payable to the state government’s MDAs without consulting stakeholders and traffic gridlock at the ports.
“These challenges are the resultant effects of legislation, regulations and policies being implemented by the government, which together increase the cost of doing business and the misery index of the citizenry,” he said.
Commenting on the challenges industrialists are contenting with nationwide, the President of MAN, Dr. Frank Udemba Jacobs, corroborated Meshioye’s concerns, noting that manufacturers in Lagos state have in recent times been overwhelmed by increment in taxes/levies without consultation with business owners.
Represented by one of the council members of the association, Engr. Reginald Odiah, the MAN President said that despite the state government’s agreement to harmonize inspection of factories and work places levies, complaints by members of the association showed that MDAs in the state were yet to implement the agreement.
The industrialist appealed that the over 150 per cent increment in environmental development levy and petroleum storage permit payable to the Lagos State Environmental Protection Agency (LASEPA) be reviewed downward.
Jacobs also pointed out that the LASEPA’s biennial review of the Environmental Audit Report remained a huge cost burden on manufacturers, especially in the face of the fact that the federal agency on environmental regulation, National Environmental Standards and Regulatory Agency (NESREA), reviews the same document once in three years.
He also cited the state government’s upward review of the land use charge as another instance of tax burden, saying that charge has further compounded the problem of high operations cost of manufacturers.
This is even as he berated the Lagos State Government for not patronising made in Nigeria goods.
“The state government has exhibited high level of reluctance. We appeal that the administration directs a reversal of this trend by ensuring that patronage of made in Nigeria products is enshrined in the procurement policy of the Lagos state government,” Jacobs said