MAN Commends Media for Advocacy, Stresses Need for Sustainable Manufacturing

The Manufacturers Association of Nigeria (MAN) recently held the 2025 Edition of the MAN Media Personality of the Year Award and Presidential Media Luncheon in Lagos.

Otunba Francis Meshioye (OFR) praised the press for their critical role in holding the government accountable and ensuring the implementation of favorable policies for the survival of the real sector of the economy. He emphasized, “A country that fails to develop its manufacturing sector will end up importing poverty and exporting wealth! This should not be the case for Nigeria, and that is why MAN is irrevocably committed to facilitating an environment conducive to manufacturing business and economic development.”

In his speech, MAN President Mr. Meshioye reflected on the association’s history, stating, “Over five decades of our existence as a business membership organization, we can attest to the important role you play in amplifying our research-based advocacy, which has contributed to some of the successes we have achieved. We thank you for your unwavering support as you continue this partnership in the new year.”

He acknowledged the significant macroeconomic and infrastructural challenges faced by Nigeria’s manufacturing sector in 2024, including high inflation, a depreciating Naira, rising interest rates, escalating electricity tariffs, record low sales, multiple taxes and levies, and security concerns. These factors collectively strained the sector’s profitability and curtailed its contribution to the nation’s GDP.

Inflation in Nigeria reached an alarming 34.6% by November 2024, diminishing consumers’ purchasing power and causing a decline in demand for manufactured goods. This inflationary burden also led to an accumulation of unsold inventory, which rose to N1.4trillion across the manufacturing industries.

At the same time, the floating of the exchange rate resulted in a steep depreciation of the Naira, which fell from ₦666/$ in mid-2023 to over ₦1700/$ by mid-2024. This depreciation inflated the costs of imported raw materials and machinery, worsening the already strained profitability of manufacturers.

Interest rates reached unprecedented levels, climbing to 27.7% by November 2024. This increase substantially raised borrowing costs, making it harder for manufacturers to access financing for expansion and modernization. The rising interest rates, combined with inflation, severely limited the potential for investment in the sector, impeding long-term growth prospects.

Additionally, manufacturers were hit hard with a drastic rise in electricity tariffs, with rates increasing by over 250%. This surge in energy costs became one of the highest operating expenses for businesses in the sector in 2024. As a result, many manufacturers sought alternative energy sources, further straining their financial resources and complicating their ability to remain competitive.

Consequently, it cannot be far-fetched that the sector’s struggles were reflected in its decreasing contribution to Nigeria’s GDP. Manufacturing’s share of the economy dropped significantly from 16.04% in Q4 2023 to 12.68% in Q2 2024, indicating a contraction in economic activity within the sector. The combination of high operational costs, reduced consumer demand, and limited access to finance contributed majorly to this decline.

Looking ahead to 2025, Nigeria’s overall economic growth is projected to be around 4%, a modest recovery compared to previous years, though still lower than the average growth rate for sub-Saharan Africa. We should expect that interest rate will begin to ease, as its continued hike by the CBN has failed to curb inflation and has instead stifled investment and business expansion. Only a favorable interest rate environment would help manufacturers access the necessary financing to reinvest in their operations and drive productivity.

Regarding the exchange rate, the Naira is predicted to hover between ₦1500 and ₦1650 to 1 dollar in the first quarter of 2025. This projection assumes effective management of the Electronic Foreign Exchange Matching System (EFEMS) introduced by the Central Bank of Nigeria (CBN) in November 2024, which, if properly implemented, could help stabilize the exchange rate.

Nevertheless, the outlook for the manufacturing sector in 2025 largely depends on the success of ongoing economic reforms, which include: the implementation of the proposed tax reforms, stabilization of critical macroeconomic indicators, and targeted investments in infrastructure and technology.

Considering the series of ongoing fiscal and monetary reforms of the present administration, the contraction of economy is expected to ease and experience some growth this year with stability in the exchange rate regime in 2025.

Similarly, the efficient adoption Artificial Intelligence (AI) will be a game changer for the manufacturing sector in 2025 and the nearest future. This is expected to help in engendering enhanced production and productivity, improved capacity utilization, innovative product development, improved inventory system, efficient logistics operations etc.

It is projected that technology adoption through research and development will fast-track the emergence of the much-awaited transformational growth of the real sector of the economy. And as manufacturers, we are gearing up and ready to embark on this interesting journey on the path of growth.

There is no gainsaying the fact that manufacturing is pivotal to galvanizing and sustaining the economic growth and development of Nigeria. We seek the government’s alignment with our conviction that a win for the manufacturing sector is a win for the economy and by extension, a better life for the citizenry.

It is in furtherance of this that we make the following recommendations to government:

– Timely passage of the 4 tax bill before the National Assembly.

– Implementation of the patronage of made-in-Nigeria products policy.

– Taming inflation.

– Ensuring food security and promoting local sourcing of Raw-Materials

– Addressing policy inconsistency

– Upgrading infrastructure (roads and railways)

– Promoting energy security and downward review of electricity tarrifs

– Prompt Clearance of backlog of Forex foreword by the CBN

– And lastly, Ensuring affordable lending rate and increased access to credit

In his welcome address, MAN Director General, Mr. Segun Ajayi-Kadir mni, acknowledged the industrial and business sectors as dependable partners in the pursuit of sustainable manufacturing. He emphasized that manufacturing is a deliberate and strategic course that any forward-looking company must support. “We should and must not relent until all these recommendations are realized,” he stated.

Mr. Ajayi-Kadir also informed the media that MAN is prepared to amplify advocacy activities and its mandate to further support the industry.

Mrs. Kofo Akinkugbe OON, Chairman of the Corporate Affairs and Strategic Planning Committee, thanked the media for their ongoing efforts, partnership, and contributions to the association over the years. She encouraged the media not to relent in their support.

She also expressed her appreciation for the remarkable media exposure in 2024, with over 4,500 mentions on various media platforms, a significant improvement from over 3,000 mentions in 2023.

In conclusion, she urged the Media to make the award more competitive. As the Media continues to serve as the conscience of the society we charge them to be worthy ambassador of the association.