Manufacturers seek policy to protect indigenous firms against alleged illicit activities by foreign firms at free trade zones
Dr. Mallinson Afam Ukatu, Chairman of Mallinson Group of Company has called on the Federal Government to choose policies that empower, support, and elevate Nigerian manufacturers, not policies that reduce them to spectators in their own economy due to the activities of foreign firms at free trade zones, among others.
Afam, Fellow, Manufacturers Association of Nigeria, (MAN) made the call during the end of year and engagement forum at the 2025 Commerce and Industry Correspondents Association of Nigeria (CICAN) End-of-Year/Engagement Programme, held on Thursday, December 4, 2025, at the Manufacturers Association of Nigeria (MAN) House, Awolowo Road, Ikeja, adding that nations that dominate global trade do so not by chance, but by deliberate commitment to industrialisation anchored on access to affordable finance, stable energy, and fair market systems.
Afam, represented by Mr Dominic Ezugwu, Chief Financial Officer, Mallinson Group, stated that Nigeria cannot fully unlock her manufacturing potential unless financing mechanisms are competitive with what is obtainable in other industrial economies.
He lamented that manufacturers are struggling to access funds that are not only costly but encumbered by procedural bottlenecks
He highlighted that the Bank of Industry (BOI), for instance, has commendably offered facilities at relatively moderate rates of 8 to 9 percent based on credible track records and proper documentation applicant, adding that these funds are often routed through commercial banks, where delays and reluctance to disburse create severe setbacks.
“In many cases, the funds arrive at the banks, but instead of immediate release to manufacturers, the banks hold them back, waiting for access to foreign exchange to pay for imported machinery. Meanwhile, the manufacturer is left servicing interest on funds never fully accessed. How do we compete?” he queried.
He cited China, where government-backed loans are extended to their nationals at zero interest for export of machinery and equipment, adding that their strategy is clear: secure market presence by making it easy for their manufacturers to establish operations anywhere, including Nigeria.
“Their machines are often coded to function seamlessly until payment obligations fall due, at which point the system can automatically shut down. It is a sophisticated but strategic approach to ensure that value continues to flow back to their home economy through machinery sales, spare parts, and long-term maintenance contracts,” he stated.
He explained that in Nigeria, these same Chinese and Indian companies operating in our industrial sector enjoy even greater advantages including duty exemptions, access to free trade zones, tax waivers, and accelerated processes that indigenous manufacturers can only dream of.
According to him, many of them pay minimal duties when bringing in machinery or semi-finished products, and even when levies apply, what they pay cannot be compared to the steep charges faced by local importers and manufacturers at the ports.
Afam added: “We must ask ourselves: What is happening in our free trade zones? Why are players there allowed to produce goods that end up flooding our local markets—goods that account for as much as 99 percent of their output, without corresponding export records? What purpose does a free zone serve if it becomes a backdoor into the domestic market at the expense of indigenous manufacturers who pay multiple taxes, duties, and fees? The result is a deeply uneven playing field that undermines our national goals.
“Today, nearly 60 percent of Chinese entrants into Nigeria are no longer just investors, they have become traders. They operate shops in major markets like Idumota and Alaba; they own warehouses; they clear their goods themselves. They sell directly to Nigerians at the ports, often at prices local manufacturers cannot match because of the incentives they enjoy both here and in their countries. And while some celebrate this as “foreign investment,” we must ask: What is the economic value retained in Nigeria? When the proceeds from sales ultimately flow back to their home countries through repatriation, raw material sourcing, and machinery replacement, what does Nigeria truly gain?”
The nation, he said, is facing a disturbing encroachment into sectors that should be preserved for indigenous participation, stressing that foreign firms have taken over construction, real estate development, and large-scale engineering contracts—sectors in which Nigerian experts have proven capacity, while our engineers watch from the sidelines as opportunities slip away.
“If indigenous manufacturing must survive. Indeed, if it must thrive, the government must rise to the occasion. We need policies that are not only well crafted on paper but effectively implemented in practice. We need an industrial environment where interest rates on manufacturing loans are reduced to single digits; where commercial banks are compelled to disburse BOI-approved funds within a strictly defined timeframe; where multiple taxation is eliminated; and where local content policies are not mere slogans but enforceable frameworks that prioritise Nigerian businesses,” Chairman of Mallinson Group advised.
He pointed out that energy remains a critical obstacle, as the cost of generating power in Nigeria, relying heavily on diesel and petrol, has made production exorbitantly expensive.
Global industrial nations, he said, are transitioning to natural gas and compressed natural gas (CNG) as cleaner, cheaper options, hence, Nigeria, with one of the world’s largest gas reserves, should not be left behind, because without reliable and affordable energy, industrial competitiveness is impossible.
He averred that what Nigerian manufacturers seek is not preferential treatment, but a fair and level playing field, one where indigenous businesses can innovate, compete, and expand; one where Nigeria can finally move from being a consumer nation to a productive and exporting powerhouse.
“If government wants everyone to go into the free trade zones, then let such zones be equitably distributed across states, with clear rules, transparency, and accountability. And if we truly desire a flourishing industrial sector, we must reform the incentives structure to protect indigenous investment and ensure that the wealth created in Nigeria strengthens the Nigerian economy.
“Let us choose policies that empower, support, and elevate Nigerian manufacturers, not policies that reduce them to spectators in their own economy,” Afam emphasized.
In his goodwill message, Salami Musa from the Corporate Services Division of the Manufacturers Association of Nigeria (MAN) on behalf of Divisional Head, Dr. Segun Alabi, and by extension, the Director General and the President of MAN, stated that CICAN remains a vital stakeholder and strategic partner in the pursuit of our advocacy mandate.
“It is no exaggeration to say that without the quality of representation you provide, our efforts would be akin to winking in the dark, lacking the visibility and amplification that your platform so effectively delivers.
“We are sincerely grateful for your continued support and wish to reaffirm how much we value this partnership.
“As we look ahead, we are optimistic about deepening our collaboration in the coming year for even greater impact.
“Let me also take this opportunity to remind you that entries for the MAN of the Year Personality Award, an initiative dedicated to recognizing and celebrating the outstanding work you do, are still open. Submissions will close on December 15th,” he concluded.
Earlier in his welcome address, the Chairman of CICAN, Mr Charles Okonji stated that although manufacturing rebounded to contribute 9.62 percent to GDP in Q1 2025, that gain remains modest and fragile, adding “More broadly, industry watchers note that between 2020 and 2024, manufacturing’s contribution to GDP has steadily declined. This trend underscores a deepening structural imbalance that threatens long-term industrialisation and economic sustainability.”
Okonji highlighted that the challenges facing manufacturing are not abstract, but very real as many in the sector point to persistent constraints including unreliable power supply, inadequate infrastructure, poor logistics and transport networks, limited or high-cost access to credit, and unstable foreign exchange conditions.
He noted that the reduction in credit to manufacturing, and the rising cost of borrowing, has dramatically weakened the capacity of manufacturers to invest, expand or even sustain operations.
According to the CICAN Chairman, “The ripple effects are obvious: diminished output, declining contribution to GDP, reduced job creation, and an economy increasingly reliant on services while the productive base atrophies. This is not the Nigeria we envisioned when we spoke of vigorous industrial growth, export-led development and a diversified economy delivering dividends of democracy for all our people.
“Therefore, as we approach the end of 2025, this Forum sends a clear signal: We believe in the potential of Nigerian manufacturing, but realisation of that potential requires urgent, strategic government intervention and sustained private-sector commitment.
“First and foremost, there must be robust investment in infrastructure, namely: access roads, reliable transport and logistics networks, modern storage facilities, and stable, affordable energy supply. These are not luxuries; they are essential prerequisites for industrial competitiveness.
“Second, we need sound, consistent policies that prioritise domestic manufacturing and promote “Made in Nigeria” goods. This includes full implementation of local-content policies, incentives for local sourcing and production, and measures that protect and reward local manufacturers against undue disadvantages.
“Third, the fiscal and monetary environment must become more supportive. High interest rates and unpredictable foreign-exchange conditions have eroded confidence and curtailed investment. The cost of capital must be moderated, and access to affordable credit, perhaps through intervention funds or manufacturing-specific financing, should be prioritised.
“Finally, there must be a concerted shift in mindset: government and private sector alike must look inward. We must recognise that reviving and empowering our industrial sector is not only a path to economic growth, but a sure way to deliver tangible dividends of democracy: jobs, sustainable livelihoods, wealth creation, export earnings, and less dependence on volatile global commodity markets.”