According to the Association, although the first quarter 2022 MCCI index score of 53.9 points fell below that of the last quarter 2021, the overall result shows that even though the economy recorded positive improvement despite unstable macroeconomic fundamentals, the manufacturing sector is still largely under severe pressure, its health very well in the fringes and below the desired performance threshold.
In addition, feedbacks from
manufacturers identified Limited supply of electricity; High cost of local and imported raw-materials; Persisting acute shortage of forex for importation of
machine, raw materials not available locally and persisting insecurity in the
country as the first our out of the challenges limiting the performance of the
manufacturing sector in the period under review, it added.
Undoubtedly, MAN through its Manufacturers CEO’s Confidence
Index noted that the precarious situation that the manufacturing sector is
currently in and the looming dangers ahead calls for a National Response and
Sustainability Strategy to guarantee the survival of sector and avoid further
de-industrialization.
The Manufacturers Association of Nigeria (MAN) designed
Manufacturers CEO’s Confidence Index (MCCI) for quarterly research and advocacy
publication gauge which measures changes in pulse of operators and trends in
the manufacturing sector quarterly, in response to movements in the
macroeconomy and Government policies.
The standard diffusion factors deployed in the MCCI analytic
processes include the Current Business Condition, Business Condition for the
next three months, Current Employment Condition (Rate of Employment),
Employment Condition for the next
three months and Production Level for the next three months. The direct survey on over 400 Chief Executive
Officers of MAN member-Companies has MCCI contained a baseline index of 50
points that suggests a stationary point in the economy and affirms the level of
confidence and performance in the quarter under review.
The trend observed by over 400 Chief Executive Officers of
MAN member-Companies in the first quarter 2022 MCCI resonates with a priori
expectations, the oscillatory trajectory of the macroeconomy and fluctuating
manufacturing performances observed in the last two years. In fact, the
performance recorded is largely similar but with slight differing magnitude
when compared with what was obtained in the last quarter of 2021, it was noted.
“Clearly, the prevalence of familiar binding constraints to
the steady growth of the manufacturing sector, the reverse effects of COVID-19
pandemic and the food shortages, rising inflation, foreign exchange parity,
economic uncertainty, general increase in price of petroleum products, supply
chain disruptions and the growing concern of future increase in the prices
of wheat and fertilizer manufacturing
inputs occasioned by the Russian invasion of Ukraine are contributory factors
that impacted the aggregate MCCI.
“The general decline in the index point and the dimmed
outlook for the second quarter evidenced by expectations of lower production,
employment and unfriendly business condition, is a cause for concern.
The report disclosed that the decline in the Index score for
the First Quarter, 2022 include eroding disposable income of consumers, high
interest rate, excessive drive for revenue by Government, obvious neglect of
the economy for politics, the persistent acute shortage of Forex; insecurity, the immediate impact of the Russian Invasion of Ukraine as seen in the hike in price of Diesel, wheat
and other imported manufacturing inputs.
.jpeg)
.jpeg)
.jpeg)
.jpeg)
0 comments:
Post a Comment