'Inadequate energy supply pushing manufacturers to costly self-generation'

The Manufacturers Association of Nigeria (MAN) has raised concerns over the persistent challenges posed by inadequate energy supply, forcing manufacturers to invest heavily in self-generated power at a substantial cost.

This, according to MAN, is eroding the profitability of businesses across the manufacturing sector, making it difficult for companies to remain competitive in both local and international markets.

Chairman of MAN Apapa branch, Raphael Danilola, who stated this during the association’s 23rd yearly general meeting in Lagos, said the combined forces of high energy costs and inflationary pressure had interplayed to weaken production.

He added that manufacturers had been forced to operate under excruciating circumstances, worsened by inherent systemic contradictions during the year, sustainability issues and rising energy costs, which made doing business unattractive and created clogs in the wheel of attracting Foreign Direct Investment (FDI).

Danilola emphasised that power supply had remained a major challenge for manufacturers in the country, constraining them to rely on alternative energy. He added that the steady upward trend in the expenditure on alternative energy sources remains a big concern, noting that access to affordable and dependable energy supply for operational activities of the manufacturing sector remains a big concern due to the lack of supply from the grid.

“Many manufacturers are reluctant to expand their investments due to finding alternative energy sources, which come at a higher cost. “These challenges have remained for years and are not only limited to the manufacturing sector. This calls for very drastic and urgent steps to cushion its effect on the economy and we hope that the government will soon realise that inaction will continue to worsen the state of our economy,” he said.

Danilola emphasised that to encourage investment in the manufacturing sector, government must invest in the growth of a strong energy and technology sector that are essential for industrialisation.