MAN Doubts NEEDS' 5% GDP Growth Target
Industry
By Crusoe Osagie
The Manufacturers Association of Nigeria (MAN) has stated that the achievement of the Gross Domestic Product (GDP) growth rate of 5 per cent being targeted by the nation's economic team in the National Economic Empowerment Development Strategy NEEDS document may be unachievable if the current trend of price instability is not checked.
According to a MAN report, it is difficult to accomplish any reasonable improvement in GDP growth rate when inflation is soaring.
"Price instability has already surfaced within the first half of this year. Instead of inflation rate of between 10 (and) 11 per cent which is the target for 2004, inflation rate has already been quoted to be as high as 18 per cent. One doubts, therefore, whether the GDP percentage target of 5 per cent would be achieved," the report stated.
MAN however stated that the outlook of 2004 was promising. According to the report, with the profile of the current economic team in place in the country expectations are high that the economy will be better managed and tailored to service the needs of the people and the entire economy.
The report highlighted that the major targets of the NEEDS document and budget statement for this year were modest and attainable.
The report extolled the Federal Government's commitment to improve the infrastructure in the country evident in the allocation of about 60 per cent of the budget 2004 to the improvement of infrastructure and agriculture.
"Infrastructure deficiencies have been the greatest source of worry to manufacturers and the economy in general. There is no doubt that with proper policy focus and packaging on infrastructure in 2004 budget, the economy should respond through measurable and sustainable growth," the statement said.
MAN explained that there were positive prospects for better performance of the economy in 2004 especially within the manufacturing and agricultural sectors.
The report explained that hopes were also high that the construction sector will step up with the plan of the government to embark on completion of abandoned projects in 2004. "There is increased hope that the manufacturing sector will be able to meet greater challenges of an increasingly competitive environment and improve on its share of the GDP, capacity utilisation, employment generation, new investments, production output, reduced stock level of finished inventory and ultimately profitability," it stated.
"There certainly is a greater focus on the manufacturing sector as the government expects 60 per cent capacity utilisation from manufacturers in 2004," it added.
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