Due the current level of dollar scarcity, the Nigerian biggest domestic vehicle assembly firm’s activities have been paused. Dozens of white buses stand at the end of the production line, expected to ply some roads on the continent, but unfortunately they are going now where.
As a result dolar starvation, the Innoson Vehicle Manufacturing (IVM) cannot buy imported components, leaving the buses without engines – a metaphor for the problems afflicting Africa’s most populous nation – Nigeria.
The poor state of the manufacturing sector in particular is a blow to President Muhammadu Buhari, who has been pushing hard to wean Nigeria off its dependence on crude oil sales, which make up 70 percent of government revenues.
GDP figures on Wednesday confirmed that the continent’s biggest economy slid into its first recession in 25 years in the second quarter, shrinking by 2.06 percent after a 0.36 percent contraction in the first three months of the year.
[vc_row][vc_column width=”1/3″]Launched in 2010, IVM last year raised its annual production target for 2016 from 4,000 to 6,000 vehicles due to a “Made in Nigeria” campaign that generated strong sales to the police, state agencies and churches.[/vc_column][vc_column width=”1/3″]At IVM, whose products are intended to show Nigeria can export more than oil, workers have already been sent home because of a lack of parts from Japan, China and Germany, which account for much of the content of the vehicles they produce.[/vc_column][vc_column width=”1/3″]Production had stopped “as we are waiting for the imported items for which there is a forex issue,” chairman Innocent Chukwuma said at the firm’s plant at Nnewi, in southern Nigeria.[/vc_column][/vc_row]