‘Let’s avoid another economic lockdown’

Director General, Manufacturers Association of Nigeria (MAN) Dr. Segun Ajayi-Kadir, spoke with Charles Okonji on his expectations for the economy. Excerpts:

 

Based on the most recent economic activities of the country, what do you think the Nigerian economy will be in 2021?

There is need to be optimistic in the midst of all the negative indicators. Chief among the concerns for 2021 is the second wave of Covid-19 which is rearing its head at the end of 2020 and just as if the damage it did to the economy in the first half of 2020 was not enough and we can see what is happening in more advanced economies. So you could imagine what it would be in developing economies like ours now that some states are already considering closing some aspects of the social economy. But we are hopeful that the government will not lock down the economy like it did in 2020 and because of the fact that some of our businesses have not yet recovered from the lockdown of 2020.

Can you tell us what is expected in the sectorial levels?

As a matter of fact, let me say about one and a half of just only two sectors out of the 10 sectors are able to operate for the most part of 2020. So you can imagine the state we are in. We cannot afford another lockdown in 2021. The government has to do its best to ensure adherence to Covid-19 protocols and how they can manage the economy without shutting it down.

How do you intend to cope with Covid-19 protocols in manufacturing?

As manufacturers we have mobilised our members and we are going to strictly abide by the protocols that we have set for ourselves and we tend to make it operational in all our industries across the country.

Now that inflation is above 18 percent what is the effect on the economy?

As for me, the inflationary rate is quite worrisome and it is a threat to economic growth. The foreign exchange apart from the unfriendly rates accessibility is also a challenge. Although some of the government’s intervention funds have been available to give succour to industries which we have not been able to access due to some administrative bottlenecks that have been put in place by the bank that is supposed to lend, saying that they have not had clear signals from the Central Bank of Nigeria. So in most cases, our members are unable to access these funds which could have given succour to the manufacturers. So they are entering 2021 with a challenging business proposition.

How can we boost investor-confidence in 2021?

The government needs to address issues of insecurity because you can hardly have a successful business plan if you do not feel secured and if you can’t guarantee the safety of those who work for you and the places where your factories are located are safe.

What is your view on 2021 budget?

2021 requires greater attention in order for us not to suffer major setbacks and as we have already seen, we are running a deficit budget and the average revenue is a little shy of N8trillion and the expenditure is N13 trillion, so already we have a N5trillion fiscal deficit that we are running and this would be financed by new borrowings which would be above N4trillion and proceeds from privatisation which is less than 1trillion, so I think that there is need for government to be more stringent in terms of its expenditure, we need to be able to get value for money in all our expenditure profile and wastages of unnecessary spendings should be completely gone away with.