By Stephen Simon
c has raised the alarm over the declining performance of Nigeria’s manufacturing sector, blaming high energy costs, inadequate financing, import competition and weak industrial coordination for the sector’s persistent challenges.
The group, in a statement issued ahead of the 32nd Nigerian Economic Summit, said manufacturing, which should serve as a major driver of Nigeria’s economic transformation, had suffered a relative decline and was contributing a shrinking share of the nation’s Gross Domestic Product.
According to the NESG, Nigeria continues to export raw materials and import finished products despite its abundant natural resources and a domestic market of more than 220 million people. It said the imbalance was suppressing value creation, limiting employment opportunities and leaving the economy vulnerable to fluctuations in global commodity prices.
The group identified energy costs as one of the biggest obstacles confronting manufacturers, noting that unreliable electricity supply has forced many companies to depend heavily on alternative sources of power. It also cited competition from imported goods, particularly subsidised products, as a major threat to domestic producers.
The NESG further blamed inadequate access to affordable capital for the sector’s weak investment and productivity. It said capital had historically flowed towards activities offering quicker returns, while manufacturing and other productive sectors remained underfunded, describing the situation as both a market and policy failure.
It also identified agriculture as a major opportunity for industrialisation, noting that the sector employs about 36 per cent of Nigeria’s labour force but suffers significant post-harvest losses because of inadequate storage, processing facilities, cold-chain infrastructure and mechanisation.
The NESG said the forthcoming summit would examine measures including development finance, blended financing, risk-sharing mechanisms, Special Economic Zones and incentives for value-added production. It stressed that Nigeria must move away from exporting raw materials and importing finished goods if it is to create jobs, raise productivity and achieve sustainable economic growth.
