MAN tasks world leaders on peace for economic growth

COMFORT EKELEME, BUSINESS EDITOR

The Manufacturers Association (MAN) in its recent confidence index said recent experiences across the globe have shown that the emergence of a challenge in one country can become a major constraint with spiral effects for the entire world.

MAN, however, noted that the learning curves from recent development include the need for leaders all over the world to jointly manage global peace and deepen the cord of interdependence of countries along the line of development priorities of nations and the obvious reality that when disruption occurs in any part of the global economy, only countries with automatic stabilizers and strong internal economic mechanisms will be able to respond appropriately.

The Aggregate MCCI score, MAN said declined to 53.9 points in the first quart of 2022 from 55.4 points recorded in the fourth quarter of 2021, adding that the score suggests fairly stable confidence in the economy driven primarily by improvement in the current business condition.

Also, MAN noted that this obviously calls for the crafting of a National Response and Sustainability Strategic Plan to avert the looming economic crisis and shortages that would arise from the impact of the Russian invasion of Ukraine.

According to MAN, the trend observed in the first quarter of 2022 MCCI resonates with a priori expectations, the oscillatory trajectory of the macroeconomy and fluctuating manufacturing performances observed in the last two years.

MAN noted that the performance recorded is largely similar but with a slightly differing magnitude when compared with what was obtained in the last quarter of 2021.

“Clearly, the prevalence of familiar binding constraints to the steady growth of the manufacturing sector, the reverse effects of COVID-19 pandemic and the food shortages, rising inflation, foreign exchange parity, economic uncertainty, a general increase in the price of petroleum products, supply chain disruptions and the growing concern of future increase in the prices of wheat and fertilizer manufacturing inputs occasioned by the Russian invasion of Ukraine are contributory factors that impacted the aggregate MCCI.

“All of these clearly show that the ongoing invasion of Ukraine will continue to have negative spiral effects on every sector of the economy if not halted as soon as possible. The implication of allowing the invasion to continue for the manufacturing sector will include an enormous decrease in capacity utilization (as factories begin to experience stock-out situations), inflation, dwindling sales, lower productivity, unemployment and heightened insecurity. Certainly, all of these would also have severe implications for the economic and social well-being of over 200 million Nigerians.

“Although the first quarter 2022 MCCI index score of 53.9 points fell below that of the last quarter 2021, the overall result shows that even though the economy recorded positive improvement despite unstable macroeconomic fundamentals, the manufacturing sector is still largely under severe pressure, its health very well in the fringes and below the desired performance threshold,” MAN said.

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