Manufacturers have defied heightened insecurity across the country to invest a whopping N2 trillion in the economy in the whole of 2013. The amount represents 101 percent of N996.08 billion worth of investments in 2012, data from the Manufacturers Association of Nigeria (MAN) has shown.
MAN attributes these major internal and external investments to improved sales made possible by innovation and better packaging, especially in the food and beverage sector (notably beer and food processing firms).
Analysts say this is an indication that the Nigerian economy is becoming more diversified, even as manufacturers in the country are expanding and looking outwards to other markets across Africa, Europe and the Americas. Additionally, these investments created 1.584 million jobs by the end of 2013.
Two other key factors responsible for the increased investments are better inventory management across sectors and an increase in the number of new entrants, according to the data from MAN.
“This was in anticipation of the investment climate and the expectation of investors in the areas which government seems to direct attention, particularly in the areas of automotive and heavy industrial concerns,” says MAN.
Investments in assets, such as land and buildings, within the year totalled N332.15 billion. This implies that manufacturers made investments worth N95.99 billion in the first half (H1 2013) and N236.17 billion in the second half of the year (H2 2013). Similarly, investments in plants and machines reached a total of N843.44 billion by end of the year as H1 2013 injections reached N159 billion, while injections in H2 2013 were worth N684.44 billion.
Furthermore, manufacturers invested N83.054 billion in H1 2013 in furniture and equipment, as well as N161.398 billion in H2 2013. Hence, total investments on furniture and equipment by year end were N244.45 billion.
Also, a total of N283 billion worth of investments were made in motor vehicles within the year as H1 2013 injections totalled N126.11 billion while they were worth N156.88 billion in H2 2013.
Similarly, the value of total assets under construction was N297.72 billion by the end of the year. This implies that the value of investments in assets under construction in H1 2013 was N102.18 billion, while that for H2 2013 totalled N195.54 billion.
On sectoral basis, total investments by the 10 sectors of MAN in H1 2013 were worth N566.33 billion, while those of H2 2013 were N1.43 trillion. Players in the food, beverage and tobacco sector made total investments of N82.47 billion by the end of 2013, while those in the troubled textile, apparel and footwear sector made investments of N5.29 billion. This indicates that with more support and control of influx from Asia, the sector will attract more investors.
Similarly, wood and wood products investments totalled N363.63 million. This is an indication that the sector is still under-exploited, say analysts.
Businessday
