The acute shortage of foreign exchange in Nigeria is a major operational nightmare facing manufacturers in the country, the Manufacturers Association of Nigeria.
The association, in its MAN CEOs Confidence Index for the fourth quarter of 2020, said manufacturers had been facing forex challenges since the second quarter of last year due to a significant decline in the inflow of forex into the country.
It said the situation worsened in the fourth quarter despite the forex injection into the market through Bureaux De Change operators and other interventions,
Manufacturers still find it extremely difficult to source FX for the importation of raw materials and machinery that are not locally available.
It said constant and large depreciation in forex (as with the naira) made imports expensive, again leading to high inflation.
Therefore, variability and large depreciation in exchange rate obstruct economic activities and manufacturing production is not in any way insulated.
It said a favourable exchange would present good omen and improve manufacturing production.