The Manufacturers Association of Nigeria (MAN) has reported that the last three years of macroeconomic reforms, while necessary for long-term growth, have resulted in the loss of over 18,900 jobs and a reduction in capacity utilisation to 57.7 per cent .
The director-general of MAN, Segun Ajayi-Kadir, characterised this period under President Bola Tinubu’s administration as a challenging yet transformative economic transition.
He acknowledged the government’s commitment to addressing long-standing economic inefficiencies through substantial reforms aimed at restoring stability and positioning the country for sustainable growth.
He stated, “the administration’s efforts to correct structural distortions are commendable. However, manufacturers have faced significant challenges as they adapt to the adjustments brought about by these policies.”
He explained that “the impacts of measures such as the removal of fuel subsidies, exchange rate liberalisation, and adjustments to electricity tariffs have markedly changed the manufacturing landscape. While these reforms are critical for stabilizing the macro-economy, they have also led to increased production costs.
“Following the immediate removal of the fuel subsidy in May 2023, logistics and distribution expenses surged by over 300 per cent within weeks. These pressures were exacerbated by the rise in electricity tariffs for Band A consumers, which increased from approximately N68 per kilowatt-hour to between N209 and N225, compounded by ongoing issues with electricity supply stability.
“To maintain operational efficiency, manufacturers have increasingly relied on alternative energy sources, such as diesel and gas, leading to a significant rise in energy expenditures from N781.68 billion in 2023 to N1.34 trillion in 2025. This shift has negatively impacted industrial competitiveness and contributed to a decline in manufacturing capacity utilisation, which fell from 61.3 per cent in the first half of 2025 to 57.7 per cent in the latter half.”
He added that “the rising operational burden also contributed to significant job losses across the sector, with over 18,900 jobs affected during the review period.”
Ajayi-Kadir noted that “the liberalisation of the foreign exchange market has had mixed effects. While the aim was to enhance transparency and eliminate distortions, the rapid depreciation of the naira has sharply increased the cost of imported industrial inputs.
“This situation has seen the exchange rate rise from about N463 to the dollar in June 2023 to around N1,535 by December 2024, driving the cost of imported raw materials from N3.04 trillion in 2023 to N6.64 trillion in 2024, an increase of approximately 118 per cent.”
Despite these challenges, Ajayi-Kadir pointed out several recent policy measures that offer hope for recovery and growth in the sector.
Ajayi-Kadir noted that “the liberalisation of the foreign exchange market has had mixed effects. While the aim was to enhance transparency and eliminate distortions, the rapid depreciation of the naira has sharply increased the cost of imported industrial inputs.
“This situation has seen the exchange rate rise from about N463 to the dollar in June 2023 to around N1,535 by December 2024, driving the cost of imported raw materials from N3.04 trillion in 2023 to N6.64 trillion in 2024, an increase of approximately 118 per cent.”
Despite these challenges, Ajayi-Kadir pointed out several recent policy measures that offer hope for recovery and growth in the sector.
He noted that “the implementation of the Naira-for-Crude initiative has alleviated some foreign exchange pressures, particularly within the downstream petrochemical and plastics value chain. Additionally, fiscal measures that zero-rated VAT and excise duties on pharmaceutical raw materials and medical devices have provided essential support for local manufacturers.”
He added that the 2025 Tax Reform Act introduced provisions designed to enhance the industrial environment.
Ajayi-Kadir emphasised that “while recent reforms have presented obstacles, they also lay the foundation for necessary economic restructuring.”
He called for collaborative efforts to further refine these policies and ensure they effectively address the needs of the manufacturing sector while promoting growth.