Inaccessible Forex force Manufacturers hands for local raw materials
Following the Forex restriction policy set-up by the Central Bank of Nigeria, CBN, and the scarcely available foreign exchange, reports have shown that manufacturers have been forced to look inwards for their raw materials.
Manufacturers have thus embarked on the search for raw materials locally or close substitute to their raw materials in light of the near impossible access to Forex through official route.
According to Mr. Linus Kotey, a master brewer of wine, he said his company has started sourcing for local substitutes instead of waiting for foreign exchange.
Kotey, a biochemist and the Chief Executive Officer, PEL Extracts Limited, said; “We are working hard to see if we can find locally sourced packaging materials or substitutes for the current packaging that we have,”
The Group Managing Director and Chief Executive Officer, Chemstar Paints Industries, Mr. Emmanuel Awode, also expressing the option the company is exploring in order to source for raw materials said; “The dollar scarcity is particularly hard on the paint industry because over 70 per cent of our raw materials are imported, but we are looking around for local substitutes.”
Other companies under the Manufacturer association of Nigeria have also been affected by the current inaccessible Forex and may be forced to either purchase at a higher rate which will spike the cost of production hence the market price or source internally for their raw materials or its close substitute.