[b]Driven largely by receipts from the industrial sector, the Federal Government earned N179.5billion ($1,136.33million) revenue from the non-oil sector in the first quarter of 2013, the Central Bank of Nigeria (CBN) has said.

This was contained in the banking watchdog’s Economic Report for the First Quarter of the year.

The report noted that the $1,136.33million, which represented an increase of 15.1 and 9.3 per cent over the preceding and corresponding quarter in 2012, respectively, was driven largely by receipts from the industrial sector and manufactured goods.

According to the Report: “Total non-oil export earnings by Nigerian exporters stood at US$1,136.33million at the end of the review period. This indicated an increase of 15.1 and 9.3 per cent above the levels in the preceding quarter and the corresponding quarter of 2012.

“The development was attributed, largely, to the 66.9 and 70.3 per cent rise in receipts from the industrial sector and manufactured products, respectively.”

The apex bank added: “A breakdown of the proceeds in the review quarter showed that industrial, manufactured, agricultural, minerals and food products earned US$634.2 million, US$322.6 million, US$89.9 million, US$67.9 million and US$21.7 million.

“The shares of industrial, manufactured, agricultural and food products as well as mineral and transport in non-oil export proceeds were 55.8, 28.4, 7.9, 6.0 and1.9 per cent.”

Commenting on the CBN Report in Abuja, yesterday, the National President, Nigerian Association of Small Scale Industrialists, Chief Chuku Wachuku, said the report underscored the importance of the manufacturing sector as the pivot for the transformation of Nigeria’s economy.

He said: “The CBN’s report which said that receipts from manufactured goods was responsible for the significant increase recorded by the non-oil sector in the first quarter of 2013, is a very good development for not only the manufacturing sector in particular, but also for the economy in general.

“The report underscores the importance of manufacturing as the major driver of job creation and wealth generation globally.”
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The Ministry of Industry, Trade and Investment recently kicked off the implementation of the Nigerian Industrial Revolution Plan, based on areas where the country currently has comparative and competitive advantage.

This, according to the Minister, Mr Olusegun Aganga, is part of efforts aimed at diversifying the nation’s economy by increasing non-oil earnings and contribution to the country’s Gross Domestic Product.

He said: “Nigeria has huge human and natural resources that are yet to be fully translated into wealth for our citizens. For decades, we have relied heavily on the oil and gas sector, which obviously has generated a lot of revenue for the Federal and state governments, but is less inclusive.

“The good news is that today, we have started reversing that process by focusing more on diversifying the earnings base and deliberately positioning our industries as key drivers of growth. We have started seeing some results.”

Aganga added that the Federal Government was committed to partnering the state, local governments and the Organised Private Sector on the provision of a sustainable enabling environment to fast-track the growth and development of the nation’s manufacturing sector in line with the goals of the NIRP.

He said: “We are creating a sustainable enabling environment that is capable of attracting and retaining both domestic and foreign investments. Government’s driving force has been the need to meaningfully improve the welfare of the average Nigerian by designing and implementing policies and strategies that will lead to inclusive economic growth.”

The real sector of the Nigerian economy is bogged down by many problems. Power has been the most debilitating of all the challenges manufacturers and agricultural producers have had to deal with in the last thirteen years or so, with a good number of them paying the ultimate price and shutting down production permanently.

Analysts say the present Federal Government, unlike most of the others before it, seems to respond better to the cry for help from manufacturers with policy and financial bailouts rolling in to the rescue of several dying companies.

Evidence of the commitment of the current administration to supporting manufacturing and agribusiness is the current state of liquidity of the Bank of Industry (BoI).
No one seemed to know much about BoI until the President Goodluck Jonathan Administration picked it up and channeled unprecedented funds to it.

Many have erroneously believed that the expertise of the current Managing Director of the Bank, Ms Evelyn Oputu, has made all the difference in the bank’s improved performance, but with all due regard to the achievement of Oputu who has demonstrated some commitment to industrial revival, the responsiveness of the current President to the needs of the real sector might have made a lot more difference than Oputu’s expertise.

[b]Application of Funds
Under Jonathan, billions of naira has been channeled towards development financing through BoI. The bank is managing the N100 billion textile industry resuscitation fund; the N10 billion fund for rice processors; N200 billion fund for refinancing of high interest loans taken by manufacturing outfits at single digit rate and several other funds from state governments, individuals like Alhaji Aliko Dangote, as well as other public and private sector bodies interested in enterprise development in the country.

During former president Olusegun Obasanjo’s tenure, he made numerous promises to manufacturers and real sector operators, with most of them going unfulfilled. Analysts said Jonathan, on the other hand, has made good majority of the pledges he made to the real sector.

Obasanjo made the Export Expansion Grant (EEG) popular but after setting it up and luring investors to commit funds to ventures that produce for the export market, with the guarantee provided by the grant, which promises to pay back 10 to 30 per cent of the value of non-oil products sold to the exporter, he took the wind off their sail with endless delays in payment of the grant and eventual suspension of the entire process. Several export-oriented ventures failed in the process.
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Although the justification by the Obasanjo administration for the suspension of the EEG was the allegation that the scheme had been hijacked by corrupt ‘portfolio non-oil exporters’, it does not change the fact that genuine investors who, because of the EEG promise, committed funds borrowed from local and international financial institutions to non-oil exporting, got their fingers burnt and saw their investments go down-the-drain.

Stakeholders said these genuine investors, whose investments were swept away as a result of the corrupt practices of a few criminal elements, were too critical to be sacrificed as collateral damage in the government’s effort to end the fraud in the EEG scheme.

Financing Textile Revival
[b]Pundits are also familiar with the textile industry revival fund, which was promised by Obasanjo early in his administration. A promise that appeared to be fulfilled when the former president handed cheques to textile operators just before handing over office, only for the recipients of the cheques to discover that funds were not provided for the cheques they carried. The financial instruments were reportedly dud and fictitious.

Manufacturers in the textile industry had then alerted that the cheques issued by the federal government at the tail end of Obasanjo’s regime were dud cheques. Former President Obasanjo’s administration initiated a N70 billion intervention loan to resuscitate the comatose textile sector that was on the brink of collapse.

Out of this amount, N20 billion was supposedly earmarked for cotton farmers while N50 billion was meant for textile manufacturers. Obasanjo, shortly before he left office, handed over some signed cheques to a group of textile manufacturers at a ceremony to symbolise the take-off of the textile revival loan scheme.

The first revelation of the non-existent textile fund came to light when members of Kano Business Revival Initiative paid a courtesy visit to Charles Ugwuh, after he then assumed office as Minister of Commerce and Industry. Their outcry probably fell on deaf ears of the federal government as it made no remarkable effort, considering all observable trends in the final collapse of the industry, to trace the fund.

Alhaji Bashir Borodo, then President of the Manufacturers Association of Nigeria (MAN), had pointed out that the fund was yet to reach the intended beneficiaries as the cheques issued by Obasanjo’s administration were symbols of empty gesture.

After several distress calls by textile manufacturers, on October 8, 2007, the United Nigeria Textiles Plc (UNTL) in Kaduna was closed down for the first time in 43 years. It was the last surviving textile firm in Kaduna at the time. Over 250,000 workers had lost their jobs in the industry in a little over a decade.

Analysts say the Nigeria Export Import bank (NEXIM) has been giving some explanations as to why the cheques issued were not backed by real money. The bank was quoted as saying that the money was actually going to be from a foreign loan, which was not ready at the time that the former president insisted on having the ceremony to hand over the dud cheques.

It was not until the Jonathan administration took office that the real sector began to experience actual fulfillment of promises made by the federal government. A lot of promises were made in the area of financial bailout and policy restructuring to help the real sector forge ahead and to a very large extent most of the financial bailout promises have been fulfilled.[/b]

Other Funds
In the last five years, the federal government has rolled out various funds totaling about N900 billion with the intention of rescuing the real sector of the economy from an impending failure occasioned by failed infrastructure in the country and the global economic crisis.

There had been the N500 billion industrial sector bailout fund introduced by the Central Bank of Nigeria; the N100 billion textile industry resuscitation fund managed by the Bank of Industry; the N200 billion Commercial Agriculture Credit Scheme (CACS) introduced by the Federal Ministry of Agriculture and the CBN; and the N75 billion fund for Small and Medium Enterprises development.

There was also the N10 billion fund for local rice processors. Apart from these funds which were initiated and released by the current administration, existing schemes like the EEG have also been revised and implemented to the letter with deserving export manufacturers receiving the grants fairly regularly.

Policy Implementation Gaps
All said, there are varied areas where the current administration has not quite succeeded however, and these include the areas of policy formulation, and consistency, as well as infrastructure improvement.

The flip-flops and shuffling of policy during the Jonathan administration has been amazing as well as amusing. So inconsistent have the policies been that operators have on various occasions resorted to dog fights in the pursuit of the interpretation and implementation of federal government’s trade and economic policies.

These fights among stakeholders reached huge dimensions in the battle between Dangote Cement and Ibeto Cement, rice importers against rice processors, crude palm oil importers and plantation owners; cosmetic dealers; sugar processors and local sugar refineries; the list is endless.

On the other hand, the impact of these policy complications on the development of the real sector pales in significance when compared to the impact that the terrible roads and the absence of other means of transportation is having on the nation’s industrial growth.

All one needs to be convinced of the government’s neglect of infrastructure is to ply some federal government roads in the country, through which businesses carry out their distributive functions. A good example in this category is the Ikorodu–Shagamu express road, which provides access to major manufacturing outfits including Lafarge cement plant, PZ Cussons industry; and NNPC, Mosimi depot among others.

To see a road of such economic value to the federal government and the private sector abandoned and left to become a major threat not only to economic goods but also to human beings who ply this road daily, tells the story of this government’s abdication of its role of providing adequate infrastructure.

If not for the purpose of posterity, the federal Ministry of Works and the Federal Emergency Road Management Agency (FERMA) should intervene urgently and repair the Ikorodu-Shagamu road for face-saving purpose.

Rossikk: I'm sure some will say GEJ bribed or threatened the Central Bank governor into making this report.

taharqa2:

Later, some Clowns would come and tell me that GEJ is not working. Imagine what would have been happening in this country by now by now but for the orchestratd BH crisis and the massive PROPAGANDA of some political Desparados, just cos some persons are against ONE MAN.

Bros Rossike , please can you post from that thread you opened some timke ago on the new Manufacturing firms that are opening shops in Nigeria? I cant find it

Rossikk:

No probs.. here it is..

https://www.nairaland.com/1249139/foreign-investors-pour-into-nigeria/1