Posted by By Chioma Madu on
Precision Electrical and Related Employers Association of Nigeria (PEREAN) has announced closure of more than 60 electrical firms due to government reform polices and the influx of imported smuggled electrical items into the country.
Precision Electrical and Related Employers Association of Nigeria (PEREAN) has announced closure of more than 60 electrical firms due to government reform polices and the influx of imported smuggled electrical items into the country.
President of the association Chief J. B. Oke, who disclosed this on the occasion of the 27th Annual General meeting of the association in Lagos said that since the inauguration of the association, over 60 member companies have folded up.
Reasons for the closure of these factories he said was as a result of government reform polices and the influx of imported smuggled substandard goods into the country.
"Member companies are experiencing massive economic setback. Our industry has been the most hit by these reforms," he stated.
Said he: "While we appreciate government's good intentions, the timing as well as the implementation and control have been most inappropriate nevertheless, the present situation should be a wake-up call to member companies of this association to consolidate strategies which would be presented as a common position of operators in our industry."
Commenting on power generation, Chief Oke noted that there was a slight improvement in power generation from 4200 mega watt in 2003 to 450mega watt in 2004. Government, he said, also demonstrated its commitment to transparency and accountability when it published the revenue allocated to various tiers of government.
On challenges being faced by the real sector, he said that the range high interest rate, lending between 32 per cent and 35 per cent, declining capacity utilisation as a result of low purchasing power and competition from cheaper-priced smuggled products. Other hindrances he pointed out are high cost of production occasioned by poor infrastructure and rising cost of energy, and loss of productive man-hour as a result of unnecessary industrial and national strikes.
He said that the incessant hike in the price of petroleum product led to a resurgence in inflation, despite the promises of the Federal Government to keep the rate at a level below 10 percent. In reality, the economy had to grapple with an inflation rate in excess of 13 percent. The GDP growth stood at 4 percent as against the projected 5 percent. Targeting a GDP rate of 6-7 percent.