Real sector suffers further decline in October –CBN

The monthly Manufacturing Purchasing Managers’ Index (PMI), of the real sector suffered a 14.5 per cent decline in the month of October 2016, according to the Central Bank of Nigeria’s (CBN), monthly report, published on Tuesday.

This means that the Nigerian manufacturing sector has suffered its worst hit since the recession.

There has been outcry from the sector following manufacturers’ inability to source dollars to import items for production and high interest rate, which the CBN has refused to review downwards.

The months of July and August saw a fall of 9.5 per cent of the PMI, while that of September report showed a declining to 10.5 per cent, but the all time fall of October has been recorded as the highest decline in the history of Nigeria.

According the monthly review, 16 sub-sectors were randomly surveyed out of which only two sustained the September marginal stability growth, and they are, the appliances & components and the food, beverage & tobacco products.

But the rest sub-sectors, which registered decline as surveyed, included the electrical equipment; primary metal; fabricated metal products; petroleum & coal products; transportation equipment; computer & electronic products; printing & related support activities and others.

Read also: Again oil prices drop as OPEC members split

The report indicated that in ten consecutive months, production level index for manufacturing sector has maintained constant decline, but at a slower rate than the index recorded in September and October 2016.

Said Dr. Frank Jacobs, the MAN President, “Unless the Federal Government would listen to our appeal to come to our rescue by subsidising the interest rate for the real sector and assisting the sector have easier access to dollar, more decline will be suffered and with its subsequent effects on productivity and the labour market in the country.”

Also, observers said they were not surprised that the sector has been recording decline in the past months because recession usually reduces the purchasing powers of consumers of goods and services.

They said the way out is for the government to create a conducive investment environment that could attract more foreigners into the country, otherwise more danger may be lurking around the sector.

By Emma Eke ….

 

 

 

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