Throughout quite some time, Nigeria’s manufacturing industry has been significantly dependent on imported raw materials, and current figures indicate that this dependence is only growing. The value of imported raw materials was N649.21 billion, up 23.9 percent year over year. In the third quarter of 2022, according to the National Bureau of Statistics, the increase in raw material imports is a worrying trend for the economy of the nation since it shows that the manufacturing sector in Nigeria is not self-sufficient and unable to supply the raw materials it requires. The decrease in raw material items exports in Q3’22 further emphasizes the difficulties the industry is facing.
According to Investors King, the manufacturing sector is crucial for any economy since it fosters innovation, job creation, and economic progress. Yet, depending so heavily on imported raw materials might leave the industry exposed to outside shocks like price changes and supply chain hiccups. The Nigerian government must put laws and incentives in place to stimulate the local production of raw materials in order to overcome this problem. To expand the capacity of local industry, this might include tax advantages, subsidies, and spending on research and development.
Its a must for government to support the local production of raw materials.
The government might encourage regional companies to expand operations upstream in the supply chain to generate the raw materials they require, thereby promoting the growth of backward integration. This would increase employment and lessen the nation’s reliance on imported raw resources. Nigeria’s manufacturing sector’s persistent reliance on imported raw materials is a worrying trend that requires immediate attention. The government must implement clear policies to encourage domestic raw material production and lessen the reliance of the industry on imports in order to achieve sustainable economic growth and development.
A worldwide e-commerce platform called Picodi.com reported that the cost of the essential food products a typical Nigerian family needs to survive increased by 17.5% from N40,980 in January 2022 to N48,130 in January 2023. According to the research, this sum is 60.4% more than the nation’s monthly minimum net wage of N30,000, meaning that even the minimum wage is unable to pay for such a basic basket of goods. This shows that the lowest paid workers’ earnings climbed more slowly than food prices. The report’s list of staple foods includes milk, bread, grains, eggs, cheese, beef, fruits, and vegetables. According to the survey, just seven of the 67 nations covered in the ranking had minimum wages that had not increased since January 2022, with Nigeria coming in last place out of 67 other nations.
A total of 1.3 billion litres of petrol has been imported into the country.
According to Investors King, the consequences of the Russian-Ukrainian war caused Nigeria’s inflation to soar to a 17-year high last year. The National Bureau of Statistics’ data reveals that in December 2022, the country’s inflation rate reached 21.34 percent, which was the highest level in 17 years. According to the most recent Nigeria Development Update report from the World Bank, Nigeria’s fast inflation rise has reduced the N30,000 minimum wage by 55% and increased the number of people living in poverty by an anticipated 5 million by 2022. The paper also notes that greater inflation in 2022 is thought to have contributed to the poverty of an extra five million Nigerians between January and September of that year, primarily due to rising costs for local staples including rice, bread, yams, and wheat, particularly in urban areas.
Shubham Chaudhuri, the country director for Nigeria at the World Bank, claims that the nation, which has been riding the oil price movement, is now at a crucial crossroads. He says Nigeria has the option to carry out important macroeconomic and structural reforms that can lessen its vulnerability to crises and boost growth. By doing this, Nigerians as a whole will have improved life outcomes, higher per capita incomes, and sustained poverty reduction. Ayo Kadoso, General Coordinator of the Nigerian Midstream and Downstream Petroleum Regulatory Authority’s South-West area, reports that 1.3 billion litres of gasoline had been brought into the nation overall. This information was made public during a trip to the Ijegun tank farms in Lagos by the Federal Government’s task force team on fuel price compliance. The 1.3 billion litres of gasoline are divided between 690 million litres in marine/offshore stockpiles and 580 million litres in interior depots.
Members who fail to comply with the new price would be sanctioned.
The Independent Petroleum Marketers Association of Nigeria’s National Controller of Operations, Mike Osatuyi, also discussed the new pricing strategy and stated, “All of my members are going to load at N172 per litre”. Yet, our main concern is how the government will continue to provide supplies to the depot while maintaining the stated price control. Nonetheless, I want to think that the administration is committed to continuing to bring in supplies. All IPMAN members were given a warning by Osatuyi to abide by the new price since doing otherwise would result in sanctions.
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