The Manufacturers Association of Nigeria (MAN) has urged the Central Bank of Nigeria (CBN) to resolve outstanding obligations on foreign exchange forward.

The association also urged the apex bank to stop money deposit banks from harassing manufacturers over unmet foreign exchange forward obligations.

MAN expressed deep concerns regarding the issues, noting that manufacturers heavily rely on access to FX for importation of essential raw materials, machinery and equipment not locally available.

Segun Ajayi-Kadir, MAN’S director general in a statement made available to BusinessDay, said recent developments have shown a troubling trend of banks handling the matter in a way that is detrimental to manufacturers.

“Our members have reported significant unwarranted complexities and undue highhandedness by the banks,” he said.

According to him, manufacturers faced stringent requirements that are not aligned with the apex bank’s guidelines, resulting in unnecessary bottlenecks and illegal freezing of their corporate and personal bank accounts.

He noted that the action negatively impact production, which could threaten the sustainability of manufacturing operations.

He cited an example of a worrisome case of a forex forward related dispute involving KAM Industries Nigeria Limited, a leading manufacturer in the steel sector in West Africa and one of the commercial banks in Nigeria.

He noted that there are several other manufacturers undergoing simar harrowing expereinces with the banks over the issue.

“This should stop in the interest of economic development of Nigeria, job security and business sustainability,” he said.

“As it is the norm, commercial banks receive payments in Naira either through direct remittance from their customers or credit facility for the purpose of securing FX for raw-material importation.”

“Upon receipt of these funds or grant of credit facility, the banks then remit the Naira to the central bank on behalf of their customers.”

“And from that point, the funds are deemed to be held by the apex bank, thereby completing the customers’ obligations.”

Given this background, MAN asserted that its members are not liable for delays or complications arising after the remittance of funds to the CBN by commercial banks.

“Our members have played their part and the commercial banks should play their own part,” he said. “Our members should not be harassed by the banks,” he added.

He urged commercial banks to show understanding and be supportive as stakeholders collectively seek a solution to this rather unfortunate and unexpected impasse.

“As the innocent one and quite evidently the weakest and most vulnerable in the tripod, it is unconscionable that manufacturers are bearing the brunt,” he said.

“We call on the Central Bank to direct the concerned commercial banks to immediately unfreeze the accounts of innocent manufacturers in relation to the vexed issue of forex forwards,” he urged.

“We reiterate our call on the Central Bank of Nigeria to speed up the long overdue redemption of the unsettled forex forward, as a lasting solution to the dilemma.”

“We reiterate the readiness of MAN to engage with the banks and other stakeholders to co-create the solutions that will facilitate the timely resolution of the long-drawn impasse.”

Commercial banks and manufacturers should be partners that collaborate to build shared prosperity for the nation, not adversaries, he noted.

He said the association is open to foster dialogue between the commercial banks and its affected members.