The Lagos Chamber of Commerce and Industry, LCCI has raised concerns about the significant influx of loans and bonds into the manufacturing sector during the first half of the year.
The Chamber noted in a statement that this situation reflects the challenges facing the manufacturing sector and the need to meet short-term obligations and slowing business activities.
The National Bureau of Statistics reported an 88.16 per cent increase in capital inflow into the manufacturing sector in the first half of 2023 at $861.16 million compared to $457.67 million in the first half of 2022.
For example, Dangote Group and Tolaram raised N300 billion in bonds, $38 million, respectively, the statement noted.
The Director-General of LCCI, Dr Chinyere Almona said, “The significant increase reflects a low base of capital imported in the previous year and investors’ reaction to the two critical reforms, fuel subsidy removal and exchange rate harmonization, in the first month of the new administration.
According to Almona, the “Inflow in H1 2023 is expected to impact the manufacturing sector, particularly firms mitigating against current challenges, meeting short-term obligations, and falling consumer demand.
“Despite the harsh operating environment, the sector continues to demonstrate a degree of resilience and grew by 1.61 per cent and 2.20 per cent in Q1 and Q2 2023 respectively.