Manufacturers’ confidence maintains upward momentum as policy pushes PMI to 55.3
The confidence of Nigerian manufacturers has continued on the upward trajectory as the Purchasing Managers Index (PMI) in September rose to 55.3 points, as against 53.6 index points in August, indicating expansion in the manufacturing sector for the sixth consecutive month, according to the Central Bank of Nigeria (CBN).
According to the PMI report released by the CBN on Thursday, production level, new orders, supplier delivery time, employment level and raw material inventories, grew at a faster rate in September 2017.
The Manufacturers Association of Nigeria (MAN) says the continued rise in PMI is an indication that recent policies made by the Federal Government are yielding fruit.
Frank Udemba Jacobs, president of MAN, said manufacturer’s access to foreign exchange has improved significantly, reviving struggling manufacturing firms and raising the confidence of investors.
“Apart from access to foreign exchange, manufacturers are now looking at resource-based industrialisation, which is utilising our God-given natural resources to drive industrialisation,” Jacobs said on Thursday in Lagos.
“The issue of foreign exchange for the importation of essential manufacturing inputs is important, but if we tenaciously drive the resource-based industrialisation programme, challenges we have can be overcome,” he stated, adding that industries are yearning for patronage of locally made products to remain afloat.
At the recent annual general meeting of MAN in Lagos, Jacobs enumerated some of the policies influencing the manufacturing sector positively, as including: adoption of the National Industrial Revolution Plan (NIRP) of the immediate past administration, inauguration of the Nigeria Industrial Policy and Competitiveness Advisory Council, the establishment of the Presidential Enabling Business Environment Council (PEBEC) and the Micro, Small and Medium Enterprises (MSME) Clinic.
Others are lifting of the ban on Export Expansion Grant (EEG) re-admission of 36 of the 95 items into the official foreign exchange market and the special $20,000.00 quarterly FX allocation to SMEs for the importation of vital raw-materials and machinery.
Segun Joseph Ajayi-Kadir, acting director-general of MAN, said it is important to incentivise manufacturers.
“The issue of patronage of locally made products should be taken very seriously now. If we patronise locally manufactured goods, manufacturers will have enough money to package their goods better and raise their quality,” Ajayi-Kadir said in Lagos on Thursday.
According to the PMI report, 14 of the 16 subsectors experinced growth in September. They include appliances and components; electrical equipment; chemical and pharmaceutical products; non-metallic mineral products; printing and related support activities; plastics and rubber products; food, beverage and tobacco products; furniture and related products; transportation equipment; cement; paper products; computer and electronic products; textile, apparel, leather and footwear and fabricated metal products. The primary metal and petroleum and coal products subsectors contracted in the review month.
The production level index for the manufacturing sector grew for the seventh consecutive month in September 2017.
At 58.8 points, the index indicated an increase in production at a faster rate, when compared with its level in the preceding month. Thirteen of the 16 manufacturing subsectors recorded increase, while three subsectors declined during the review month.
At 53.5 points, the new orders index grew for the sixth consecutive month. Ten subsectors reported growth, while six subsectors contracted in the month of September, 2017.
On the non-manufacturing side, business activity, new orders, employment level and inventory, grew at a faster rate in September 2017.
The composite PMI for the non-manufacturing sector stood at 54.9 points in September 2017, indicating growth in non-manufacturing PMI for the fifth consecutive month. Of the 18 non-manufacturing subsectors, 15 recorded growth.
ODINAKA ANUDU &HOPE MOSES-ASHIKE
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