By Bimbola Oyesola 08033246177,                       [email protected]

Organised Labour in the Chemical sector of the economy has decried the high exchange rate in the country saying that it is grossly affecting the manufacturing sector.

President of the Chemical and Non Metallic Products Senior Staff Association (CANMPSSAN), Segun Samson David at the 26th edition of the union’s annual series of National Management/Industrial Relations Seminar of the union held in Ibadan at the weekend opined that Government need to come up with workable and sustainable policies for the ease of doing business.

According to him, the common man is always at the receiving end, noting this is more evident as Nigeria is an import dependent country.

He said,”Over 90% of raw materials used by the manufacturing companies are imported. The exchange rate is a mere indicator of the balance of supply and demand in the foreign exchange market. “The recent slide in the official exchange rate (N410 to a US Dollar), the widening gap between it and the parallel market premium (N600 to a US Dollar) is a test to the capacity of the government to stabilize the Naira. The country annual average net goods exports inflow compare to the outflow has been on abnormally negative trend.

“There is short flow of dollar compare to outflow. The parallel market rate is determined mostly by speculators and rent seekers in a shallow and illegal market which constitutes a very tiny proportion of the foreign exchange market in Nigeria.”

The CANMPSSAN President noted that

foreign exchange is necessarily high because of its scarcity in the market in relation to the demand of the desperate economic agents (including the manufacturing companies) that needed dollar at all cost,

He advised the monetary authority to mount a strong and effective surveillance of the foreign exchange market to void the cabal that constitute the BDC, check the round-tripping of foreign exchange from deposit money banks to parallel market and ensure one market-determined window for all.

He said, “Let government save forex and build buffers during oil booms.

There should be rationalization of import structure to manage demand for foreign exchange, and finally create an enabling environment for productive capital inflows especially foreign direct investment.

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“We can’t help but mention this as it seems that government does not understand what is happening.”

Reflecting on the theme of the three days seminar, “Sustainable Industrial Harmony and Productivity: An imperative for Achieving Organizational Effectiveness and Navigating Difficult times” the President said it is borne out of how the recessive effects of the ravaging pandemic have resulted in high inflation in the economy, a situation that may lead to collapse of businesses with resultant job losses if not carefully managed.

He reasoned that sustainable industrial harmony enhances productivity and is one of the critical means of improving performance in the manufacturing sector, achieving economic growth, enhancing living standards and quality of life.

“This year seminar has been designed to help us build our workplace communication for harmonious working relationships, strategize for ways to navigate difficult times for improved workers welfare and industrial efficiency,” he said.

He lamented the multifarious problems bedeviling Nigeria as a nation presently, which cut across insecurity, COVID-19 pandemic resulting in economic recessions separatist agitations and others.

“The spate of kidnapping and banditry is nothing to write home about.

In the midst of all these confusion, our leaders became disillusioned, nothing seems to be working correctly and at the receiving end is the populace/workers who bears the brunt of all manners of economic strangulations,” he stated.

Against the background of all these challenges, he warned government against increasing tax as reflected in the 2022 Budget presented by President Muhammad Buhari to the National Assembly.

“Presently, companies in Nigeria pays company income tax of 30% plus 2% of educational tax making it 32% compare to the developed countries that pay 20%. For me, it is a wrong time to talk about tax increase. The real sector is suffocating, chains of businesses are disrupted, foreign exchange and its impact on the importation of raw materials is alarming therefore any additional increment like company tax could destroy whatever hope there is for the survival of the industry.

“On the other hand, labour will be affected because when companies cannot bear it anymore, they tend to reduce cost on the side of workers by considering retrenchment or mass sacking of workers, increase in outsourcing and increase in personnel income tax.

“Workers will now have less purchasing power than they did before the COVID-19 pandemic, giving the inflation in the country. Unemployment will keep on rising, crimes and other nefarious activities will increase as most employees will be out of job,” he added.