Chairman and CEO of the Dangote Group, Aliko Dangote, has criticized the Central Bank of Nigeria’s (CBN) recent decision to raise the interest rate to almost 30 percent.
In a keynote address at the opening of a three-day National Manufacturing Policy Summit organised by Manufacturers Association of Nigeria (MAN) at the State House Conference Center, Abuja, he stated that businesses cannot cope with the current rate and that “Nobody can create jobs with an interest rate of 30%. No growth will happen.”
The CBN’s Monetary Policy Committee (MPC) had increased the Monetary Policy Rate (MPR) from 24.75 percent to 26.25 percent in May 2024, citing recent economic and financial developments and assessing risks to the outlook.
Dangote called on the government to protect existing businesses, especially manufacturers, by providing an enabling environment for them to thrive. He emphasized that an import-dependent country is equivalent to poverty importation and that “No Power, no prosperity. No affordable financing, no growth, no development.”
Dangote also urged the government to rethink its industrial policy and adopt a more protectionist approach to support the country’s manufacturing sector.
He argued that Nigeria’s manufacturing industry has declined over the years due to a lack of government support and exposure to unfair competition from stronger, older competitors.
He cited examples of how other countries, such as China, South Korea, and India, have successfully protected and nurtured their domestic industries to become globally competitive.
“I am convinced that when Government Policy becomes more supportive and protective, investors will be more willing to collaborate and partner with Government in resolving other challenges such as infrastructure deficits, market instabilities and macro-economic issues,” Dangote said.
The business tycoon emphasised that protecting domestic industries is not about preventing others from investing, but rather creating an environment where local investors can thrive and eventually attract foreign direct investment. He also stressed the need for long-term policy frameworks that regard the manufacturing sector as a national asset worthy of government support.
He said: “We must look to leading countries in the West and the East who are actively protecting their domestic industries. We must similarly enact policies to protect our domestic industries and nurture them into home grown champions that will create the jobs and prosperity we desperately need,” Dangote concluded.
The President of MAN, Francis Meshioye, also criticised government policies and attitudes, saying they were responsible for the low performance of the manufacturing sector in the country.
He revealed that over 70 manufacturers have exited the sector between 2019 and 2022 and that it was time to take stock and rethink ways to support manufacturing businesses to achieve the agenda of the current administration.
Meshioye, thanked participants for honouring the invitation after several postponements, just as he also expressed gratitude to President Tinubu, for the unique opportunity and his magnanimity to host the Summit in the State House.
He said since the association opened communication with the office of the Vice President, they have been receiving tremendous support and collaboration from the Presidency.
He said the summit was organised to interrogate the evidence behind the constraints demeaning the performances of the industrial sector and to think and agree with the government on what to do to address them.
“The ultimate goal of the meeting is to reposition the sector on the path of accelerated growth, enhance its competitiveness and reap its multiplier effect on the economy and the wellbeing of the citizenry.
Highlighting the problems diminishing growth in the sector, he stated.
Credit: The Sun