By Cynthia Ezekwe
The Manufacturers Association of Nigeria (MAN) says the country’s shortage of electricity supply is a constraint to the profitability of manufacturers with an annual economic loss valued at about N10.1 trillion, about two per cent share of the country’s Gross Domestic Product (GDP).
MAN made this known in a statement reacting to president Tinubu’s signing of the electricity bill into law, noting that the unfavourable situation has ranked the country 171 out of 190 countries to do business.
According to MAN, the current power supply is inadequate to satisfy the energy requirements of the manufacturing sector and the entire population.
The statement partly read: “As an advocacy association, MAN has always pushed for the need to charge a cost-reflective electricity tariff to avoid extortion of our members. Fortunately, it is of great delight that this new Act fits like a glove as it will help actualise a cost–reflective tariff considering the healthy price competition it will bring between the states and private investors.
“The country’s epileptic power supply is one of the prominent reasons for the relocation of some of our members. Provided the new Act adequately addresses the challenges in the power sector, we are quite optimistic that such development will encourage the inflow of manufacturing FDI, boost the performance of the sector and increase the sectoral contribution to the economy.”
To this end, the association noted that the Electricity Act 2023, if well implemented, promises to be a major game changer for the manufacturing sector.
MAN stressed that if properly utilised, the new Act will address the challenges in the power sector, which will encourage the inflow of manufacturing Foreign Direct Investment (FDI), boost the performance of the sector and increase the sectoral contribution to the economy, adding that revenue from the sector can bridge the infrastructure deficits in many states without imposing further tax burden on manufacturers.