Nigeria’s manufacturing industry faces an uncertain future as persistent financial burdens threaten a fragile recovery, even as recent data indicates a slight stabilization in business operations. The Purchasing Managers’ Index climbed to 50.10 in June, up from 49.6 in May, signaling a return to growth. However, experts caution that this gain hides significant hurdles such as expensive energy, steep interest rates, and stagnant consumer demand.
Dr. Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise, noted that the sector remains vulnerable due to operational expenses spiking since the start of the conflict in Iran. He highlighted that energy-intensive manufacturing processes are struggling under the weight of surging diesel and gas prices. While foreign exchange liquidity has improved, Yusuf emphasized that manufacturers still struggle to secure affordable financing due to underfunded development institutions.
Echoing these concerns, Kuteyi Duro of the Association of Food and Agro-allied Processors noted that daily cost increases for raw materials and fuel make it nearly impossible for many firms to turn a profit. He pointed to problematic fiscal policies and tax structures as additional pressures that may force some companies to exit the market entirely.
While National Bureau of Statistics data showed the sector contributing 9.57 percent to real GDP in early 2026, experts warn that this progress is precarious. Analysts insist that long-term stability requires comprehensive government intervention to lower business costs, bolster power infrastructure, and foster local raw material development to keep the manufacturing sector viable.
