Alhaji Aliko Dangote, Chairman and CEO of the Dangote Group, said on Tuesday that rising interest rates would hurt local manufacturers.
Dangote made the statement at the start of a three-day National Manufacturing Policy Summit organised by the Manufacturers Association of Nigeria at the Banquet Hall of the State House in Abuja.
“Before I delve into my paper, let me start with some key messages.
“Nobody can create jobs with an interest rate of 30 percent. No growth will happen. No power, no prosperity. No affordable financing, no growth, no development,” he said.
His comments came just weeks after the CBN’s Monetary Policy Committee decided to raise the monetary policy rate for the third time in a row, from 24.75 percent to 26.25 percent.
On May 20–21, 2024, the Monetary Policy Committee conducted its 295th meeting to analyse recent economic and financial developments in the country as well as assess risks.
After the meeting, the apex bank resolved to “raise the MPR by 150 basis points to 26.25 percent from 24.75 percent,” the CBN Governor, Yemi Cardoso, who chairs the MPC, announced.
During his address at the manufacturer’s summit on Tuesday, Dangote stated that growth is unlikely under current circumstances.
He also urged the government to support existing businesses, particularly manufacturers, by creating a conducive environment for growth.
According to him, import reliance equals poverty importation.
Dangote said that in order for the government to address the concerns of unemployment, poverty, and insecurity, the industrial sector must be given the tools it needs to thrive.
“Let me therefore conclude by reiterating that Nigeria has all it takes to develop and sustain a globally competitive manufacturing sector. But to do so, we must rethink our industrialization policy.
“We must look to leading countries in the West and the East that are actively protecting their domestic industries.
“We must similarly enact policies to protect our domestic industries and nurture them into homegrown champions that will create the jobs and prosperity we desperately need,” he said.
Dangote, who acknowledged that there are numerous causes contributing to the manufacturing sector’s underperformance, underlined that the most pressing issue requiring attention is government policy and its approach to investments and investors.
He emphasised that industrial or manufacturing entities differ from trading entities, and he believes that the government’s primary role and responsibility should be not only to promote investments and attract investors in manufacturing but also to ensure that these investments are nurtured and protected in order to facilitate growth and sustainability.
“In every economic regime, including the most advanced, investment projects in manufacturing and industrial sectors need time and a conducive environment for them to mature, build capacity, and scale to become competitive against those in older and more mature markets.
“But since the mid-1980s, non-industrialised countries and their leaders have been discouraged from protecting and supporting such investment and forced to expose them to unfair competition from stronger, older competitors in their own internal market, even before the newcomers are commissioned. Yet these same older or bigger players are well supported in their home markets,” he said.
