The economic impact of the coronavirus outbreak forced Nigerian manufacturers to reduce their investments by 76.11 percent in 2020, according to the second half 2020 economic review released by the Manufacturers Association of Nigeria (MAN).
The report released on Tuesday stated that manufacturers reduced their financial commitment to N118.52 billion in 2020 as against N496.11 billion in 2019.
“Manufacturing investment totaled N118.52bn in 2020 as against N496.11bn achieved in 2019, the report stated.
“Manufacturing investment declined in the period following the depressing fallouts from COVID-19 that gave no impetus for new investments in the sector.”
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Inadequate foreign exchange, the lockdown introduced to curb the spread of COVID-19 virus and disruption in global supply chain firms, affected the performance and operations of may companies, especially manufacturers.
In Nigeria, the virus forced many manufacturing firms to close down to avoid outbreaks in factories and brewery firms were not allowed to open for months while many firms, which managed to open faced low patronage due to general lockdowns and inter-state movement restrictions.
The association led by Mansur Ahmed also reported unsold manufactured goods valued at N577.61bn last year due to the pandemic.
MAN said the inventory of unsold finished manufactured goods increased to N303.22bn in the second half of 2020 from N202.16bn in the same period of 2019 and N275.39bn in the first half of 2020.
“Inventory of unsold manufactured goods in the sector totalled N577.61bn in 2020 as against N402.42bn recorded in 2019,” it said.
The association attributed the increase in inventory in the period to the general low consumption and renewed imports in the economy as global economies generally opened after months of lockdown.
It said, “Electrical and electronic sectoral group accounted for over 33 per cent of the total inventory of unsold manufactured products in period.
“The group are having the challenges of low patronage, high smuggling and products counterfeiting which rubbed off negatively on inventory.”
MAN said a total of 3,903 jobs were lost in the manufacturing sector in the second half of last year, noting that the pandemic had a crushing impact on the sector.
