For many businesses, sustaining production for the Yuletide season might not be business as usual, especially at a time when inflation has eroded consumers’ purchasing power and inventory of unsold goods continues to rise.
With distillate stocks below historic averages across regions, notably in the United States, which is also a major exporter of oil products to the European Union, it means prices will remain elevated because the only new refining capacity is in the Middle East and China, and it is limited. Similarly, the acute shortage of foreign exchange in the official market has pushed naira to N860 against the dollar, altering dynamics for the importation, distribution and marketing of Premium Motor Spirit , also known as petrol and diesel.
According to him, manufacturers saw their expenses on alternative energy sources rise by 50.6 per cent in the first half of this year compared to the same period last year. “The crises are responsible for the unfavourable movements in manufacturing indicators such as capacity utilisation, contribution to real GDP, investment, employment, cost of production, competitiveness, etc.,” Ajayi-Kadir said.
He noted that Nigeria’s economy is characterised by diverse economic vulnerabilities, which have had devastating effects on businesses. “It’s a worthwhile consideration to look at all of the energy sources that are cheap and develop them, like coal. We have a lot of hydro and gas to be able to develop resources for us to be an energy generating powerhouse at least in Africa,” he added.