RECESSION: INNOSON VEHICLE PLANT STOPS PRODUCTION ON DOLLAR SHORTAGE
Nigeria’s main Vehicle assembly plant Innoson Vehicle Manufacturing (IVM) is shutting production because of the dire economic situation and lack of foreign exchange to vehicle import components like engines.
Workers at IVM 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, chairman Innocent Chukwuma told Reuters.
Production had stopped “as we are waiting for the imported items for which there is a forex issue,” Chukwuma said.
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.
Those ambitions are now looking shaky if promises of government assistance fail to materialise, Chukwuma said.
“I believe they are doing something but if they can’t do anything we’ll lay off some workers,” Chukwuma said.
Nigeria’s increasingly lame duck President Muhammadu Buhari has failed to acknowledge the seriousness or act with urgency to arrest the worst economic crises the country is facing since 1991.
The economy is officially in recession, while all his Ministers make are promises, with nothing concrete to show two years into the President’s four year tenure.
Bonus: Global X MSCI Nigeria ETF , M From inception (2H13) it’s been a free fall of -73%.