…As manufacturers struggle for FX
04 August 2016, Sweetcrude, Lagos — The Minister of Power, Housing and Works, Mr. Babatunde Fashola has called for persuasion, reasoning and dynamics of the economy to play a key role in the patronage of locally produced meters for the power sector.
Fashola who made the call on Thursday during a courtesy visit to a meter manufacturing plant, Mojec International in Lagos said commercial things cannot be done by compulsion.
“I think that commercial things should be done by persuasion, reason and the dynamics of the economy,” Fashola said.
Stating the reason why power sector players especially Distribution Companies, DISCO’s, and meter manufacturers should embrace persuasion and the dynamic of the economy, Fashola said it will make the power sector more competitive in terms of pricing and also competitive in terms of quality for the local market.
When the market is competitive in terms of pricing and quality, the Minister added that it will make more business sense to produce and patronise meters locally.
He expressed delight that there are Nigerian companies that can meet the metering demand in the country but wondered why there is still a huge meter gap in the power sector.
Commenting on the challenges of local meter manufacturers, Managing Director, Mojec International, Chantelle Abdul said is lack of finance to operate their factories and also being able to provide some kind of vendor financing to off-takers.
“One of our critical issues at the moment is lack of access to foreign exchange. A lot of our manufacturing inputs rely on goods abroad. As I mentioned during the minister’s visit my goal as a manufacturer is to produce much of my manufacturing input locally here in Nigeria so that we can go as far as producing our chips and the PCB which is the brain of the meter and all other component that is required.
“There is nothing that stops us from producing the battery that we need, the capacitors that we need. It is sad to say that we don’t have factories that can produce those things here in Nigeria,” Chantelle Abdul said.
She expressed hope that meters manufacturers can get the support of the government both at the Central Bank of Nigeria, CBN, level and financing institutions to be able to produce these components here in Nigeria, noting that they need forex to be able to do these things.
“We cannot afford to be borrowing at double digit interest rate, it will automatically increase the price of the meter,” she said.