Nigeria’s manufacturing growth slows to 1.49% in first quarter
Growth in Nigeria’s manufacturing sector slowed to 1.49 percent in the first quarter of 2024 owing to worsening foreign exchange scarcity amid shrinking consumer spending and high borrowing costs.
Data from the GDP report shows that growth in the sector saw a marginal decline of 0.12 percent on a year-on-year basis from a 1.61 percent growth rate recorded in the first quarter of 2023 to 1.49 percent in the corresponding period of 2024.
On a quarter-on-quarter basis, the sector recorded a marginal increase of 0.12 percent from 1.38 percent in the fourth quarter of 2023 to 1.49 percent in the first quarter of 2024.
Experts in the sector had in January projected that the country’s manufacturing will maintain weak growth in the first quarter owing to the worsening challenges that have continued to impact growth negatively.
“The Nigerian economy has encountered significant challenges in recent years, including foreign exchange volatility, escalating energy costs, and food insecurity,” Francis Meshioye, president of the Manufacturers Association of Nigeria said in a May 23 note.
“These challenges have intensified inflationary pressures, adversely impacting consumers’ purchasing power and impeding the growth of the manufacturing sector,” Meshioye said.
“Consequently, production levels have declined, leading to reduced competitiveness within the industry,” he added.
Nigerian manufacturers need regular electricity, accessible roads, functional railways, new technology and incentives, all are crucial in driving growth and competitiveness in the sector.
