Manufacturers are adopting survival strategies in a deteriorating environment – Report
The Manufacturers Association of Nigeria said unemployment and the business climate for manufacturing firms worsened in the second quarter of the year.
The association stated this in its “Manufacturer CEO Confidence Index,” in which it noted that its members had to resort to adopting survival strategies to improve production.
The Manufacturers Association of Nigeria CEO Confidence Index is a quarterly research and advocacy publication of the Association, which measures changes in the pulse of operators and trends in the manufacturing sector each quarter, in response to movements in macroeconomics and government policy, using data extracted through a direct survey of over 400 CEOs of MAN member companies.
According to the report, the MCCI aggregate score rose to 54.6 points in the second quarter of 2022 from 53.9 points in the first quarter of the year.
He also noted that the increase in the aggregate index score was attributed to the feedback on the expected improvement in the business situation, the employment situation and the level of production in the second quarter of the year. .
The report said in part: “It should be noted that business conditions in the quarter under review were more difficult than those of the first quarter of the year, while employment conditions deteriorated. Nevertheless, the operating environment in the quarter under review was relatively better than the previous quarter due to the compelling adjustments made by the government, manufacturers and households in response to the general price increase, shortage of foreign exchange , to the increase in the cost of energy, to the scarcity of raw materials and many others, rejected by the war in Europe.
According to the MAN, observations from the analysis of industrial areas activities showed that the operating environment in the Middlebelt and Rivers/Bayelsa areas was the most difficult during the quarter under review.
In 2022 alone, manufacturers faced a severe shortage of foreign currency, which forced many businesses to shut down. The central bank raised the policy rate from 11.5% to 14% and diesel and gasoline prices soared due to the Russian-Ukrainian war.
According to the CEO’s report, “The effect of the Russian-Ukrainian war has clearly underlined the popular maxim that the world has become a global village. The occurrence of an incident in one part of the world, no matter how specific, can in fact become a global problem.
“Therefore, in addition to the need for ardent management of global peace, the series of global events and the lessons learned demand that national governments begin to take drastic measures to proactively manage these phenomena in the future. Undoubtedly, phenomena such as the Sino-American trade war, the Asian and global financial crises, the challenges posed by the COVID-19 pandemic and now the Russian-Ukrainian war call for the development of national policy measures to anticipation.