Group managing director/Chief Executive Officer of Skye Bank Plc, Timothy Oguntayo, has called for massive investment in the manufacturing, agriculture and extractive industries for the success of the diversification program of the government.
Oguntayo disclosed this at a ‘Roundtable session on the manufacturing outlook for 2016’ organized by Biodun Adedipe led BAA Associates in Lagos on Wednesday.
According to the Skye Bank boss, who was a lead panelist at the roundtable; the three identified sectors were critical for the success of the economic diversification agenda of the current government in view of the dwindling oil prices, low GDP growth, and rising unemployment in the country.
Oguntayo who went down memory lane, said the manufacturing sector contributed 10 per cent of GDP before the oil boom of 1970s but lamented Nigeria’s overdependence on oil export and earnings from the 1990s to date.
He said the over dependence on oil resulted in the neglect of the manufacturing sector; just as low investment in public goods and infrastructure led to the decline in manufacturing activities.
To reverse the negative trend, the lead Banker recommended the expansion of public infrastructure like road, electricity, among others to promote manufacturing. In addition, he advised manufacturers to access the earmarked N200 billion Central Bank of Nigeria and N200 billion Bank of Industry’s intervention funds to boost operations.
Noting that commercial banks were not structured to provide long term funding but bridge finance, he said the Bank of Industry and NEXIM Bank should be strengthened to provide long term funding for manufacturers.
The CEO who was applauded by participants for his candour and refreshing perspective on issues, also called for the creation of development and industrial clusters to enable manufacturers share some of the fixed costs of running their facilities with other manufacturers thereby reducing their operating costs.
To enhance and optimize their capacity, the experienced Banker advised manufacturing firms to focus on improving the effectiveness and efficiency of their sales force in order to create opportunities for incremental sales growth. This, he said will keep them in business.
Oguntayo expressed his support for the import ban placed on some items that could be sourced locally, saying it would promote import-substitution strategies and lead to less stress on the Naira.
