Man sees higher inflation on petrol price hike

The Manufacturers Association of Nigeria has raised concerns over the potential economic implications of the recent increase in the price of petrol and the proposed ban on single-use plastics. Segun Ajayi-Kadiri, the Director-General of the Association, highlighted the challenges faced by businesses and households in the current economic environment. The increase in petrol prices is seen as a significant factor that could contribute to higher inflation as consumers and manufacturers adjust to the new cost reality. Ajayi-Kadiri emphasized the compounding effects of the petrol price hike along with existing issues such as multiple taxes and levies. He pointed out that the increased cost of transportation and operations is putting additional strain on businesses. The lack of sales and consumer apathy have resulted in a substantial amount of unplanned inventory, indicating a reduction in consumer spending on manufactured goods. Furthermore, the rise in petrol prices is also leading to demands for higher wages from workers to offset the increased cost of living, adding to the financial burden on industries. Ajayi-Kadiri stressed the importance of government support to address these challenges and mitigate the impact on businesses and the economy. Discussing the need for government intervention, Ajayi-Kadiri highlighted the importance of addressing the issue of weakened export competitiveness, potential job losses, and the impact on imports. He called for a phased implementation approach to policies such as the ban on single-use plastics to minimize disruptions to the manufacturing sector. The Association is actively engaging with the government to find solutions to these pressing issues. Ajayi-Kadiri noted that while the government has been receptive to their proposals, the key focus now is on the speed of implementation. He emphasized the urgency of actions such as ensuring local sufficiency in the production of petrol and reducing bureaucratic hurdles to enhance economic stability. With the manufacturing sector playing a significant role in Nigeria's GDP, the implications of ongoing challenges such as rising inflation, energy costs, and price shocks could lead to a contraction in the economy if not addressed effectively. In conclusion, the Manufacturers Association of Nigeria is calling for decisive and timely measures from the government to support businesses, protect jobs, and stimulate economic growth amidst the current economic uncertainties.