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Manufacturers have complained that the ongoing Russia-Ukraine war has led to rise in raw materials prices and would trigger difficulties in the manufacturing sector.
The Manufacturers Association of Nigeria (MAN) in a report, warned that rising prices sparked by Russia’s war on Ukraine present a “looming crisis” for companies in Nigeria.
The group said the surge in prices of diesel, wheat and other imported materials, combined with high interest rates, US dollar shortages and soaring inflation, is crippling production in Africa’s most-populous country.
The MAN added that soaring inflation, dollar shortages crippling production and called on companies to adopt ‘strategic plan’ to limit war’s impact on their operations.
For instance, manufacturers rely largely on diesel which has doubled in price this year to power their machines due to unreliable electricity supply from the national grid.
The price of wheat, a key raw material for flour millers and other food processors, has also shot up.
Companies are also worried that inflation, which accelerated to 15.9 per cent in March, could rise further if a longer conflict prolongs supply chain disruptions, the group said.
The current situation “calls for the crafting of a national response and sustainability strategic plan to avert the looming economic crisis and shortages that would arise from the impact of the Russia invasion of Ukraine,” the manufacturing body said.