Job Losses, Factory Closures Loom As Unsold Goods Pile Up

AGAINST the backdrop of sustained pressure in the foreign exchange market and high cost of production, the Manufacturers Association of Nigeria, MAN, says inventory of unsold goods is escalating to levels now threatening the existence of companies operating in the production sector of the economy with attendant job losses.

By last weekend, the foreign exchange market had recorded over 254 percent plunge in the value of the naira since flotation of the currency by the Central Bank of Nigeria (CBN) in June 2023.

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Recall that the naira traded for N471 to the dollar in the official I&E market on June 13, 2023 before the floatation of the currency, but exchanged for N1,665.50 to a dollar as at February 23, 2024 on the Nigerian Foreign Exchange Market (NAFEM), indicating a depreciation of more than 253.6 percent over the eight-month period. 

Highlighting challenges in accessing foreign exchange (forex), the Director General of MAN, Mr. Segun Ajayi-Kadir, says that manufacturers primarily obtain forex through Bureaux De Change (BDCs), noting that banks typically offer less than 20 per cent of the required amount.