The Manufacturers Association of Nigeria (MAN) has indicated that Nigeria’s estimated N77 trillion debt burden would likely truncate the economic plans of President Tinubu-led regime.
The manufacturers also lamented that the sector has been at the receiving end of Nigeria’s debt crisis which has seen the nation’s debt profile rise by 410 percent over in the last 8 years.
The MAN CEOs’ Confidence Index (MCCI) first quarter 2023 (Q1’23) report obtained by Vanguard stated: “The domino effects of escalating public debt on the manufacturing sector are endless.
“To start with, rising domestic debt is highly crowding out private investment in the manufacturing sector by reducing credit availability and forcing hike in lending rates.
“External debts are mostly serviced in foreign currencies, hence high demand for foreign currencies further depreciates the naira and makes importation of non-locally produced critical inputs highly expensive for manufacturers.
“Moreover, higher debt servicing is consuming greater volume of forex and worsening the forex scarcity that has plagued the manufacturing sector for many years. Higher debt repayment requires increased revenue.
“The Nigerian government has continued to breed a harsh business environment by its indiscriminate imposition of high and multiple taxes on manufacturers all in a bid to generate revenue.
“Huge public debt led to low foreign investment and foreign capital inflow which worsen the forex scarcity that has remained a bone in the throat of manufactures.”
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MAN further said: “Contrary to the popular parlance in the government quarters that Nigeria has revenue problem, the country’s debt crisis is not a result of inadequate revenue and it is anti-growth to view manufacturing taxes as the last resort for curbing the debt problem.
