Nigerian Manufacturers ask CBN to wave conditions on forex policy for manufacturers

The Manufacturers Association of Nigeria (MAN) has asked the Central Bank of Nigeria (CBN) to wave many conditions of its forex policy for Manufacturers in the country.  

Chief Bioku Rahman, the outgoing Chairman of the Manufacturers Association of Nigeria (MAN) in Kwara and Kogi, revealed this in Ilorin on Tuesday during the Association’s 10th Annual General Meeting (AGM).  

He also called on the Bank of Industry (BOI) to approve and promptly implement further reductions in its lending rates for industries. 

He also asked the CBN to reduce the interest rate by at least 1% while noting that the apex Bank should  

He said, “We are asking the CBN to wave many conditions for its foreign exchange policies to local manufacturers.” 

“Similarly, CBN can widen the window of foreign exchange to local industries, while urging the Federal Government to harmonise taxes and levies at Federal, State and Local Government levels.” 

“We therefore ask the Federal Government to urgently direct the Central Bank of Nigeria (CBN) to drastically reduce interest rates on industrial loans.” 

“The CBN should as well direct commercial banks to reduce interest rates on industrial loans. The interest rates charged on industrial loans and other loans released as COVID-19 palliatives should be significantly reduced further to one per cent,”  

In his address, Chief Francis Meshioye, President of the Manufacturers Association of Nigeria (MAN), described the relationship between the state government and MAN as cordial.  

He also urged the state government to upgrade the infrastructure around the industrial estates. 

What you should know  

The depreciation of the naira in the last one year has been a source of concern for manufacturers as it has affected all aspects of their operations.  

• In recent times, manufacturers have seen the cost of imported raw materials soar for manufacturers thereby increasing their overall operating cost.  

• On the financing front, manufacturers across the country have seen their finance costs increase significantly over the years. Since February 2024, the Apex Bank has increased interest rates by 800 basis points to 26.75%. Since May 2022, the CBN has been consistently increasing interest rates- a move to tame inflation and stabilise the foreign exchange market.  

• An earlier analysis by Nairametrics revealed that finance cost for consumer goods companies in the first half of 2024 has increased by over 1000% due to an increase in finance cost and exchange rate depreciation.  
• However, the Apex Bank has acknowledged their concerns with Governor Cardoso stating that interest rates will come down when inflation begins slowing down.