and tariffs on imported and finished goods. As indicated in the CSAR,
establishing the new BOI and the SMIEIS were among the key initiatives for
developing this sector. The Export Expansion Grant is geared specifically
towards supporting manufactured exports, while the National Credit
Guarantee Scheme was conceived to help mitigate the risks associated
with lending to SMEs.
544.
Available statistics reveal that the new policy initiatives have yet to affect
Nigeria’s manufacturing growth rate and competitiveness significantly.
The World Economic Forum’s Global Competitiveness Index (2006) rated
Nigeria’s competitiveness as poor in 2005. The score was particularly
low for institutions, infrastructure and the supportive macroeconomic
environment. The ranking was, however, better on innovation [particularly
expenditure on research and development (R&D)], collaboration in
research between universities and industry, technological readiness and
absorption of firm-level technology.
545.
The manufacturing sector contributed only 3.6 per cent to Nigeria’s GDP
over the 2001 to 2004 period on average, compared to agriculture’s 41
per cent for the same period. Usage of manufacturing capacity averaged
53 per cent between 2001 and 2004.
546.
Constraints to enterprise growth include cost-increasing factors like poor
infrastructure, lack of finance, uncertainty about government policies,
ineffective laws and regulations, and inefficient administration of the
business environment. Frequent interruptions in the supply of basic
utilities have proved to be particularly costly to the manufacturing sector.
For example, small firms lost 24 per cent of their output because of power
outages, medium-sized firms lost 14 per cent and large firms lost 17 per
cent.
547.
To make SMEs more competitive, stakeholders emphasised: simplifying
the access and disbursement processes of SMIEIS; public-private
collaboration to remove obstacles to competitiveness; developing value
chains; and addressing the factors that contribute to the high costs of
inputs, such as high interest rates, shortages of skilled labour, low demand
and policy uncertainties.
548.
The CRM identified a number of policy measures, spearheaded by the
Ministry of Mines and Steel Development, to develop the solid minerals
subsector. To date, 34 different minerals have been identified and are being
promoted for commercial exploitation. A further 42 mineral resources
have been discovered by the Nigerian Geological Survey Agency and are
being captured on mineral commodity maps. Developing the solid mineral
sector is the key to the current policy of diversifying the revenue base of
the economy, attracting more FDI, providing inputs for local industries
and exports, increasing opportunities for self-employment, and adding
value.
549.
The CRM findings in the oil and gas industry revealed that there have been
efforts to improve oil and gas output and to ensure greater intersectoral
links with the rest of the economy. Specifically, the government plans
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