…as 50% folds up in 30 years
Following the economic meltdown, the Biscuit and Bakery Products sub-sector of the Manufacturers Association of Nigeria has said that half the players in the business have crashed out in the last three decades.
This revelation was made by the chairman of the sub-sector, Fola Osibo, during the group’s annual general meeting held recently in Lagos.
According to Osibo, over the years, biscuit manufacturing in Nigeria has gone through challenging periods, some of which have threatened the continued existence of local manufacturers in the country.
Those challenges, he also said, had ranged from strangulating policies, to uncontrolled raw material costs and availability, and unfair competition with mostly cheap foreign biscuits imported into the market.
Hear him, “Looking back about 30 to 40 years, biscuit manufacturing operations was thriving in this country, policies were supportive of local manufacturing, raw materials were readily available, and our association had up to 40 members scattered all over the country.
“Then suddenly, the economic situation started going southwards, and our sub-sector started facing economic disruptions, and unfavourable policies which impacted negatively on our operations. Most companies could not cope as margins were completely eroded caused by rising costs of operations, and they started closing shops.
“Unfortunately, our sector has been neglected over the years, and the various government policies have impacted negatively on our operations. Growth of local biscuit production has therefore been stunted and the number of those still in operation has shrunk to only about 15 to 20 companies.”
He however called on the Federal Government to initiate responsive and local production-friendly policies to save the sector and prevent it from completely collapsing.
Part of the group’s prayers to the government included the removal of Value Added Tax (as was the situation between 1999 to 2007), reduction of net import duty on biscuit flour to 20 per cent and import duty reduction on some key raw materials such as liquid glucose, hydrogenated fat, and flavourings.
In his presentation, the Plant Director, Cadbury Nigeria Plc, Akinwande Owen, outlined fluctuation in foreign exchange rate, low consumer purchasing power, talent development and migration/relocation, multiple taxation, and government policies as the key challenges facing the manufacturing industry.
(Punch)