The Value News

COVID 19: Nigerian Manufacturing Sector In Trouble But Sekibo, Managing Director Heritage Bank Says SMEs Remain the Key To Revamping The Economy

By Stephen Ubanna

It is no longer news that the nation’s economy is at the brink of Collapse due to the Wuhan Town in Hebei Province of the Asian  country of China emerged Coronavirus pandemic. The situation is so worrisome that the leadership of the  Manufacturers  Association of Nigeria, MAN, have  given  an insight of what is happening at the sector  after a survey  that  ‘’ there is a sharp decline in the Manufacturing sector’’ .

The sharp decline in production had been attributed by business  analysts  to the  Companies inability to access the international market, particular, the Chinese market, to procure needed raw materials and chemicals to sustain their plants because of the associated  anxiety and uncertainty  surrounding the global  and the national economic dynamics as a result of the COVID 19  .

Tony Elumelu: Chairman, UBA plc

MAN Chief Executive Officers Confidence Index, CEOCI, on the economy between January and March , 2020, speaks volume. The Manufacturing Companies Confidex Index, MCCI, survey, according to MAN, in its  most recent report shows  a significant  decline  from 51.9 percent  recorded in the last quarter of 2019 to  44.4 percent, which is a pointer that the  economy is heading to a total crisis.

The  lock down of Lagos, the nation’s Commercial  nerve center, Abuja, the Federal Capital Territory, FCT, and Ogun, because of its proximity  to Lagos  by President Muhammadu Buhari for two weeks and later extended by another two weeks, may not have helped  matters, as many manufacturing Companies operating in Lagos and Ogun, particular, were forced to shut their plant to obey the government directive both at the Federal and state levels.

This may have  informed why the Association  had called on the Katsina state born Nigeria President  to grant    blanket waivers on import duties and Tax  to manufacturers to take delivery of their raw material  and chemical imports that   had  arrived the country since February 2020  and those that are due o arrive the country in July , 2020.

 Investigation by the Value News show that the  Container vessels carrying the  imported raw materials and Chemicals for the Companies that had placed order for it may be arriving the Lagos  and south east in July due to the COVID 19 problem. It is not surprising why the  leadership of MAN are asking the president  to  grant  members of the Association   waivers for their imported raw materials and chemicals  between February and July, 2020.

They may have been encouraged to do so as the President had  granted  blanket waiver to medical equipment, supplies and Pharmaceutical  drugs importers  to take delivery of their cargoes that had been abandoned at the  ports  since the outbreak of the disease in the country last February  without payment of duties and taxes.

MAN also  want the Buhari led government   to Fastrack the provision of basic infrastructural facilities, particular, accessible road networks  along  the corridor  of vital  domestic  trade hubs for transportation of raw materials  manufactured products  and agricultural  products  to  the ports  for export  to the West and Central African countries, Europe and the North American country of the United States, US.

Given the support which many manufacturing Companies are currently  enjoying  in their respective countries in this trying and difficult times in order to resume production,  the MAN leadership, has  urged the government  not to turn its back on the manufacturing sector   to guarantee their survival in order  not to throw thousands of their workers into the Labour market. Recall  that  between 2009 and 2011, 800 Manufacturing Companies had closed shop in the country. There are fears that the situation may be worse with the  current  health crisis.

In spite of the problem which the blue Chip manufacturing Companies may be have having in the recent time   as result of the lockdown  necessitated by  COVID 19,   ifie Sekibo, the  Heritage Bank , Managing Director  had said  that  the  country’s economy could still bounce back  to reckoning with the ‘’partnership,  truth, character and  commitment to businesses by  the micro, small and medium scale enterprises, SMEs.

Sekibo, who could not hide his feelings noted that for the SMEs to continue to be in business and remain the ‘’bedrock  of any vibrant economy  the players must  continuously  reinvent themselves, complement each other, dream big,  possess cutting edge ideas and think and before venturing into any  business’’.

Ifie Sekibo: Managing Director, Heritage Bank

The Heritage Bank boss who spoke   at a Virtual   Conference Platform  at the upgrade  Submit  2020 on the theme: Converting Ideas into Reality  with focus on ‘’SMEs’’, emphasized the need  for the EMEs ’’ to look inward, learn and relearn , possess the spirit of self sacrifice and believe’’ .

Advising  the Entrepreneurs  to be bold and not be afraid to fail in any business venture, he  opined that ‘’failure is not failing and therefore, should not give  the investors the impression that they have  failed in the business’’.

He regretted that the major problem of SMEs in Nigeria   has been too much of individual focus , rather than holistic  or intergenerational  focus as obtained abroad, particular, China, where there are so many SMEs. Take for instance the production of Face Mask    with the out-break  of the COVID 19, in the country.  900 SMEs, were said to have emerged  by  assisting each other to produce for export to curb the spread of the deadly  disease in the world. These SMEs are helping to revamp the Asian  country economy which was at its lowest ebb  as a result of  the Corovirus pandemic, forcing  Xi Ping , the Prime minister to give his words to pump over  $400  back into the economy as part of the measures  to bring the economy back on the path of  sustainable growth.

It is not surprising why he has  advocated  the need  for the government and Financial Institutions  to empower the SMEs as an agent of development.  He noted that the bank’s  major  cardinal  point is providing  support to young men and women  to succeed in any area of their chosen business. ,  The Rivers state born top banker averred that ‘’this is the only way the society and the economy can grow, thereby moving the nation from poverty occasioned by COVID 19  to a prosperous economy’’.

Appealing to the SMEs to take advantage of their products  for seamless banking transactions to boost their business like Stockit, HBPadie and the newly launched  24/7 alternative  electronic Platform  via USS Code *745#.  He  stated  that the bank had encouraged  hundreds  of SMEs  to adopt  the self  service Platforms  like *745*0#, Funds Transfer within the bank to boost their business over the years.

He  may have dampened the enthusiasm of some SMEs, who  may  have wanted to approach the bank for  financial  support when he revealed the areas of the economy in which investors could be helped.  Fela Ibidapo, the bank Divisional Head,  Corporate Communications disclosed  that the sectors  range from agriculture value chain businesses  such as  farming, poultry,  snail farming, , cottage industry,  mining,  and solid minerals  to creative industry,  tourism, arts and crafts . This is in addition to Information Communication Technology, ICT.

Many believe what   the bank is doing to support the SMEs  are not new. This because  Tony Elumelu Foundation, popular, TEF, alone, had committed, 100 million , between 2010 and 2020, which had been spent to  sponsor 10,000  SMEs, in terval of 10 yeaar, on the average  of sponsorship  1,000  young men and women  Entrepreneurs that cut across the African  Continent  yearly. The  Magazine Findings shows that at the end of the 10 years for the execution of the vision  by Tony Elumelu, a Philanthropist and Chairman of the United Bank plc,   a Pan African Bank , over 10,000 African SMEs had benefited from the Fund.

The Money Deposit Bank was said to have also been  very supportive in propping SMEs in the country and  the 20 African countries  where  it has  functional  branches. Recall that before TEF and UBA plc, began to give financial support to the SMEs, operating in the country, they were closing  shop at the slightest financial  problem. Take for  instance  between  200 and 2013, 130 SMEs  manufacturing firms were said to have folded up.  The situation has changed for good with the intervention of TEF and the banks, particular, UBA.     

Stephen Ubanna

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