Nigeria’s manufacturing sector is facing renewed pressure as rising production costs, expensive energy and high borrowing rates continue to weaken business activity despite signs of economic stability.
Recent data showed the Manufacturing Purchasing Managers’ Index inched up to 50.10 in June from 49.6 in May, but many firms are still reporting weaker production and fewer new orders.
The News Chronicle reports that industry leaders believe the biggest challenge is no longer access to foreign exchange but the growing cost of running factories. Higher diesel and gas prices, costly bank loans and multiple operating expenses are making it increasingly difficult for manufacturers to remain profitable or expand operations.
Business experts say recent improvements in inflation and exchange rate stability have not translated into lower production costs. Manufacturers also argue that weak consumer spending has reduced demand for locally made goods, leaving many businesses under pressure.
Analysts warn that without cheaper credit, reliable electricity, improved infrastructure and policies that lower the cost of doing business, the sector may continue to struggle. They note that manufacturing remains a key driver of jobs, industrial development and non oil exports, making its recovery essential to Nigeria’s broader economic growth.
