By Odunewu Segun
The Manufacturer Association of Nigeria has charged the Central Bank of Nigeria to lift the restriction placed on dollar inflow so as not to cripple manufacturing in the country, especially those that depends on imported raw material for their finished products.
According to the President of MAN, Chief Frank Jacobs in a statement released recently, to avoid perceived abuse of foreign exchange allocation and save the Naira, the management of forex which is vested on a Committee chaired by the Governor of the CBN should monitor utilisation of forex by recipients by remitting funds directly to the beneficiary company overseas,” he said.
Chief Jacobs said in as much as he supports the restriction to be lifted, this however, should not preclude CBN’s duty of investigating sources of such incomes.
According to him, a major source of forex wastage in Nigeria is through the on-going subsidy on importation of petroleum products.
“In the real sense, Nigeria should not have relied on fuel importation to meet the fuel requirement of the nation, given the number of refineries we have in this country which are currently lying waste. Instead, we turned around to import fuel and pay huge subsidies to fuel importers thereby wasting huge scarce foreign exchange as subsidy. MAN believes that the downstream petroleum sector should be privatized in order to save the country from wasting the huge forex paid as subsidy” he said.
Some years back, he noted, many refining companies applied for licenses and we do not know what happened to those applications or why those companies that were granted licenses did not start operation?
Chief Jacobs also asked the CBN to stop funding Bureau de Change. “The Bureau De Change market should provide alternative funding window to the economy, in which case they source their forex independently from other sources and supply to the forex market,” the statement said.
According Jacobs, in the present arrangement, Bureau de Change acts as mere distributive conduit pipes by simply getting forex allocation from CBN and selling to very few Nigerians out of the multitude that need forex; thereby making their profit without much value addition.
“Foreign exchange allocated to the Bureau De Change as well as from other sources should be channeled to the productive sectors of the economy, especially manufacturing for the importation of essential inputs and machinery that are not locally available as well as the social welfare segment of the society like hospitals, schools, etc” he said.
He noted that MAN advocates the use of guided deregulation in such a way that Naira would be left to flow freely within a bracket which the CBN would determine, adding that, this is important because at their stage of development, they cannot afford to allow the Naira to flow freely without any check.