Small-scale manufacturers hurt by poor infrastructure

Small-scale manufacturers say the state of infrastructure in Nigeria is impeding their growth.

They point at the poor state of power, saying that they spend more on alternative energy now than ever.

Benson Umeh, managing director of a palm oil mill in Imo State, said his community Umuagwo has not had electricity in the last two months, prompting him to buy fuels and diesel for his generators.

“It is quite expensive to run a small-scale business, especially in the manufacturing sector,” Umeh said.

Annual self-generating capacity in the manufacturing sector is 13,223 megawatts. Expenditure on alternative energy in the sector totalled N117.38 billion in 2017 and N129.95 billion in 2016, the Manufacturers Association of Nigeria (MAN) said. The only reliable railway in Nigeria at the moment is Abuja-Kaduna, and broadband penetration is just 30 percent.

Ike Ibeabuchi, managing director of a small-scale chemical firm, said energy constitutes 30 to 45 percent of his cost.

“By the time you finish using it, you pay taxes and buy your own water,” Ibeabuchi said.

Poor power supply ranks among the biggest challenges facing Nigerian manufacturers, which also include lack of or limited availability of good transportation systems, water, credit and high taxes.

Already, the Manufacturers Association of Nigeria, through its recently formed MAN Power Development Company, has signed an agreement with Tower Energy Solution & Systems Limited for the supply of six to 10 megawatts (MW) of electricity to Henry Carr Industrial Cluster in Ikeja, Lagos.

ODINAKA ANUDU