A financial expert, Prof. Sheriffdeen Tella, has urged the Federal Government to fast-track the growth of the manufacturing sector through the provision of infrastructure and the provision of credit.
Tella, a Senior Economist at the Olabisi Onabanjo University, Ago-Iwoye, Ogun, made the call on Sunday in Lagos while reacting to the Purchasing Managers’ Index (PMI) data for the month of July.
Tella told the News Agency of Nigeria (NAN) that the manufacturing sector was not growing as it should be since the demand for goods and services far outstripped supply.
Data from the Central Bank of Nigeria (CBN) showed that the PMI stood at 54.1 per cent in July 2017, indicating expansion in the manufacturing sector for the fourth consecutive month.
The financial expert urged the managers of the economy to develop a robust research that would show improvement in the economy.
“I think that the situation has not changed. There is need for the managers to look at the economy holistically.
“There is need for the research component to give us a true reflection of the economy,’’ Tella said.
According to him, the decision of the Monetary Policy Committee (MPC) to retain the lending rate at 14 per cent cannot stimulate the economy since the cost of borrowing is too high.
The financial expert noted that the International Monetary Fund (IMF) also said that the growth of the nation’s economy was slow, below expectation.
The don argued that no meaningful improvement could take place in an economy with a huge infrastructure deficit.
NAN reports that a composite PMI above 50 points indicates that the manufacturing/non-manufacturing economy is generally expanding.
Fifty points indicates no change and below 50 points indicates that it is generally contracting. Below are the PMI for the months of March to July.
Purchasing Managers’ Index Chart
The figures reflect that there is growth in the economy and the chances of the economy smarting out of recession promising.
The translation of the expansion of the manufacturing sector to the welfare of the average Nigerian remains an ongoing conversation.
(Source: NAN)