Real sector investors have been left guessing the direction of the Federal Government, as President Muhammadu Buhari remains silent on key policy issues such as the Automotive Policy, the National Industrial Revolution Plan (NIRP) and the Agricultural Transformation Agenda (ATA).
“Up till now, there are key policy directions the government has shown. We need to know where we are in auto policy because, we are dealing with investments worth billions of naira,” said an auto investor, who spoke on the condition of anonymity.
Some investors who were encouraged to set up local vehicle assembly plants no longer make commitments in terms of investments to the economy, as they await Buhari’s position on automotive policy. They fear policy inconsistency, which could erode their investments and bring about losses.
According to the Manufacturers Association of Nigeria (MAN), motor vehicle and miscellaneous assembly invested N5.5 billion in 2014 and N2.7 billion in the first half of 2015.
The uncertainty in the scheme has prompted some investors to suspend vehicle assembly in the country, while smugglers now smile to the bank, as they bring in cars through neighbouring countries.
“I think there is the need for government to come out clear on auto policy,” said Muda Yusuf, director-general, Lagos Chamber of Commerce and Industry (LCCI) in a chat with BusinessDay.
“People now divert vehicles to Cotonou, and from there, they bring them into Nigeria. What it means is that government is encouraging smuggling, thereby losing revenue,” said Yusuf.
Yusuf further observed that many Nigerians are losing their jobs in the maritime sector on account of the 35 percent levy and 35 percent duty for imported vehicles, approved by the policy, stressing that the policy is currently not working and should be reversed.
The Agricultural Transformation Agenda (ATA) introduced by the immediate past administration seems abandoned, as investors want to know the extent to which the government will implement the agenda.
Investors are divided over whether or not the present administration has abandoned the agenda. While many say it has been suspended, others believe it is already being implemented.
Despite various assessments by agric sector players, the direction provided by the ATA enabled the immediate past government to increase investments in rice, sugar, palm oil, and tomato, among others. According to the Lagos Chamber of Commerce and Industry (LCCI), the essence of economic pronouncements is to ensure investors are not left in the dark about government policy.
“We have not seen anything from the government,” Abiodun Olorundenro, chief executive officer, Green Vine Farms, told BusinessDay. “But the government is not completely silent on the ATA. They have promised to address issues around the ATA programme.
The ministry just defended the agric budget, so I think that is why we have not heard anything yet,” Olorundenro added.
But Tunji Owoeye, national chairman, Rice Millers Association of Nigeria (RIMIDAN), said the policy is already being implemented. “They are continuing with the policy. What they have done is that they have brought a lot of innovation into the policy. More exciting is the CBN intervention, which is a landmark intervention strategy,” Owoeye said.
The National Industrial Revolution Plan (NIRP) is also one key policy of the immediate past administration that charted a roadmap for Nigeria’s industrialisation.
The NIRP, which was prepared by Nigeria and international partners like the United Nations Industrial Development Organisation (UNIDO), details how to develop the country through iron and steel, light manufacturing, agro processing and solid minerals.
Okechukwu Enelamah, minister of industry, trade and investment, recently inaugurated a $160 million World Bank supported initiative to improve access to finance, as well as the Business Innovation and Growth (BIG) platform. But there is still silence on the NIRP.
“It is not a plan that should be phased out or abandoned in the face of a change in government, because industrial revolution is for economic good, not political, Chima Ezedinma, officer-in-charge of UNIDO in Nigeria, said in 2015.
However, Frank Udemba Jacobs, president, Manufacturers Association of Nigeria (MAN), said the current government is already implementing the NIRP and affirmed that manufacturers in the country are happy about that.
ODINAKA ANUDU
