In this interview, the Director-General of the Manufacturers Association of Nigeria, Segun Ajayi-Kadir, discusses the impact of unremitted dollar debts on manufacturing firms. Despite the Central Bank of Nigeria’s claims of settling all valid outstanding forex backlog, many manufacturers still have unsettled dollar requests, affecting the industry significantly.
The situation poses challenges for manufacturers, as some forward transactions are over two years old. While raw materials have been imported and goods produced and sold, interest payments on both naira and dollar debts persist. Manufacturers often borrowed money to deposit forex initially, resulting in ongoing interest payments.
As the CBN has not fully repaid the dollar component, manufacturers continue to face operational constraints. They struggle to generate funds for further production, accumulating significant interest payments. In the last six months alone, companies have incurred approximately N1.5 trillion in forex-related transaction losses, impacting their performance and financial stability.
Source: PUNCH