Peaceful election offers opportunity for new manufacturing investments

The peaceful conduct of the 2015 presidential election has provided an opportunity for run-away manufacturing investors to rush back and tap into Nigeria, which is full of growth opportunities.

It has also offered opportunity for inflow of foreign capital into the economy to create jobs and further grow the Gross Domestic Product (GDP).

“I believe manufacturers will now begin to invest as there is more certainty in the economy,” said Matthew Ibeabuchi, CEO, MD Services Limited.

Manufacturers and many other investors were relatively on break in the first quarter of the year owing to fears of pre-election and post-election crises that could mar the existence of the country.

Pre-election banters between the People’s Democratic Party (PDP) and the All Progressives Congress (APC) had heightened the pre-election tension in the pre-election period in the economy and further driven many off the Nigerian shores.

The shifting of the election from February 14 and 21 to March 28 and April 11, raised the tension as s many felt there was no guarantee that elections would be held.

The Lagos Chamber of Commerce and Industry (LCCI) clearly expressed the mood of investors.

Remi Bello, president, LCCI, had said “rescheduling already arranged business meetings, conferences and the like comes with dislocations and at attendant costs to investors and citizens, who will now have to wait more for the elections to be held.

“Investors need to have an idea of the direction of the country’s political and economic governance in order to manage policy and political risks of investments.”

The credibility of the electoral process needs to be managed in a way that would inspire the confidence of all stakeholders, he said.

But all that are now past as the economy has returned to normalcy following a peaceful conduct of an election in which the opposition candidate Muhammadu Buhari of the APC won.

Experts say the election will certainly affect the volume of manufacturing investments, which stood at N483 billion in the first half of 2014.

Manufacturers often invest in land and building, plants and machinery, furniture and equipment, motor vehicle as well as in assets and construction.

Investments in plants and machines were worth N349.82 billion, representing 72.42 percent of the total. This was followed by investments in land and building put at N68.70 billion, representing 14.22 percent of the total, according to the Manufacturers Association of Nigeria January to June 2014 Economic Review.

Trailing them were investments in assets under construction, estimated at N47.82 billion and indicating a 9.9 percent share of the total.

But investments in furniture and equipment were N8.96 billion, representing only 1.85 percent share of the total, while those of motor vehicles were the least with N7.75 billion, reporting only 1.60 percent.

“The level of investment indicates the confidence Nigerian manufacturers have in the economy,” according to the MAN’s report.

ODINAKA ANUDU