THE African Development Bank (AfDB), has revealed that Nigeria loses $29 billion yearly as a result of inadequate power supply, despite the fact that the country’s manufacturers spend up to N10.1 trillion on energy.
Dr. Akinwumi Adesina, president of the African Development Bank, revealed this yesterday as he expressed concern about Nigeria’s epileptic power supply and called for an industrial revolution and the digitalization of production.
Adesina stated this while delivering a keynote lecture with the title, “The Day the Lion Roared! Making Nigeria a Global Industrial and Economic Giant” at the Business Day CEO Forum in Lagos.
“It has been estimated by the International Monetary Fund (IMF) that Nigeria loses $29 billion annually due to lack of and unreliable power supply or 5.8% of its GDP. Also, Nigerians spend $14 billion per year on generators and fuel,” Adesina said.
“Lack of electricity is killing Nigerian industries. According to the Manufacturers Association of Nigeria, industries spent N93.1 billion on alternative energy in 2018.
“No business can survive in Nigeria without generators. A recent survey of manufacturers in Nigeria shows they lose N10.1 trillion annually due to power failure.”
Speaking further on the power sector, Adesina said that unless the country decisively tackles its energy deficiency and reliability, its industries would remain uncompetitive.
The former Nigerian minister for agriculture also spoke about the level of Nigeria’s underdevelopment, saying it is quite alarming adding that something drastic needed to be done to address it.
“For now, Nigeria is developing too slowly and well below its potential. The challenge is for the lion to roar. Then, we will have the making of an economic giant.”
“Nigeria should have a greater ambition for its manufacturing sector by shifting to integrating into global and regional value chains, rapidly moving up the value chains in areas of comparative advantage, driving greater specialization and competitiveness.
“A well-developed and policy-enabled manufacturing sector, with export orientation will spur greater innovation, industrial policy for export market development and structural transformation of the economy. Instead of being consumed with conserving foreign exchange, the focus would shift to expanding foreign exchange through greater export value diversification.
“Industrial manufacturing can earn Nigeria ten times what it earns from reliance on oil. Let’s change our perspective away from simply import substitution, to high-valued export-oriented manufacturing,” Adeshina said.
According to him, one of the major challenge facing the manufacturing industry in Nigeria is the very high cost and unreliability of supply of electricity.
“The source of Nigeria’s greatest wealth would come from having strong manufacturing capacity for competitiveness in regional trade and integration into global value chains,” Adesina said.
“With the right policies, investment frameworks, infrastructure, logistics and financing framework and powered by a highly trained, dynamic and youthful workforce, Nigeria must fully unleash the power of manufacturing.”