• 30 May, 2025
• FAITH MIMDOO KEGH
• No comment

Over 18,000 Jobs Lost in Nigeria’s Manufacturing Sector in 2024 Due to Tough Economic Climate.

The Director-General of the Manufacturers Association of Nigeria (MAN), Segun Ajayi-Kadir, has expressed deep concern ov

er the loss of more than 18,000 jobs in Nigeria’s manufacturing sector in 2024, attributing it to a worsening business climate.

At the 2025 BusinessDay Manufacturing Conference, Ajayi-Kadir highlighted the severe challenges plaguing the industry, including a sharp rise in unsold inventory—up by 87.5% to ₦2.14 trillion—due to inflation, low consumer purchasing power, and increasing production costs. He also revealed that manufacturers incurred foreign exchange losses amounting to ₦1.62 trillion, largely from the surging costs of imported raw materials.

Citing Nigeria’s poor performance in global industrial competitiveness, Ajayi-Kadir noted the country ranked 97th on the Global Competitive Industrial Performance Index—44 places behind South Africa. He said that despite manufacturing’s importance to economic growth, the sector remains underperforming due to macroeconomic instability, poor infrastructure, and insufficient government support.

Ajayi-Kadir described the sector as being caught in a storm of rising input costs, energy prices, multiple taxes, high interest rates, weak infrastructure, and uncertain policies. He noted that manufacturing growth fell to 1.38% in 2024, continuing a downward trend from 1.40% in 2023.

Addressing infrastructure issues, he lamented that only 37% of Nigeria’s 200,000km road network is in usable condition, severely hindering logistics and market access. He gave examples of excessive checkpoints—53 between Mile 2 and the Seme border, and 34 along the 20km stretch from Seme to Badagry—further worsening logistics costs.

He warned that persistent insecurity, especially in agriculturally active regions, has disrupted agro-industrial operations, increased risks, and discouraged investment.

Ajayi-Kadir emphasized that the manufacturing sector, long seen as vital for Nigeria’s industrialization, continues to struggle. Between 1981 and 2024, capacity utilization dropped from 73.3% to 57%, and its contribution to GDP fell from 29.9% to 8.6%. Real growth declined from 14.7% in 2014 to just 1.38% in 2024. Non-oil exports also plummeted—from 82.37% in 2019 to 25.13% in 2024.

On financing, he said access to credit remains difficult, with interest rates on loans from commercial banks rising to 35.5% in 2024, compared to 28.06% in 2023—far higher than South Africa’s 8%.

He also criticized the impact of policy instability and the flood of smuggled and substandard goods, especially in sectors like textiles and electronics. These underpriced imports erode market share, harm local industries, and contribute to revenue loss.

Calling for immediate intervention, Ajayi-Kadir urged the government to:

  Prioritize inclusive policy engagement
  Officially adopt the ‘Nigeria First Policy’
  Strengthen mechanisms for export market intelligence
  Ensure policy consistency
  Improve infrastructure and logistics
  Expedite completion of projects like the Ajaokuta-Kaduna-Kano gas pipeline

He stressed that only through strategic and coordinated action can Nigeria unlock the full potential of its manufacturing sector and achieve sustainable economic growth.

FAITH MIMDOO KEGH

Manager – Oversees the daily operations, editorial planning, and strategic direction of the platform. A graduate with a solid academic foundation in media and communication, Faith brings a wealth of experience to the TokinPoint.

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