The Manufacturers Association of Nigeria (MAN) has reported a 9 percent increase in the local sourcing of raw materials within the manufacturing sector in 2024, citing continued foreign exchange (FX) fluctuations, high import costs, and policy measures encouraging local content development.
According to MAN’s Second Half 2024 (H2’24) Economic Review, local sourcing rose from 52.0 percent in 2023 to 57.1 percent in 2024. The association attributed this growth to limited foreign currency availability, elevated costs of imported inputs, and government initiatives aimed at strengthening domestic supply chains.
Improvements were particularly evident in sub-sectors such as Wood & Wood Products, Textile, Apparel & Footwear, and Chemical & Pharmaceuticals. However, the Electrical & Electronics segment continued to face challenges due to its reliance on imported components.
Despite the gains in local sourcing, overall sector performance remained mixed. Real manufacturing output increased by 1.7 percent year-on-year to ₦7.78 trillion, supported by growth in areas including Motor Vehicle & Miscellaneous Assembly, Non-Metallic Mineral Products, and Electrical & Electronics. However, there was a half-on-half decline of 3.1 percent in real output, reflecting rising production costs and subdued consumer demand.
Nominal output grew significantly by 34.9 percent to ₦33.43 trillion, influenced largely by inflation and higher domestic prices.
Investment trends were less encouraging, with real manufacturing investment falling by 35.3 percent year-on-year to ₦658.81 billion in 2024. The decline was attributed to economic uncertainty and restrained expansion plans. However, investment rose by 19.4 percent in H2 2024 compared to H1 2024, indicating cautious optimism among manufacturers. In nominal terms, investment declined by 11.3 percent to ₦2.85 trillion, with the most notable reductions in Land & Buildings and Furniture & Equipment.
Segun Ajayi-Kadir, Director General of MAN, noted that the sector faced significant headwinds during the year, including high inflation, FX instability, and weakening consumer demand. He emphasized the importance of macroeconomic stability, reliable energy supply, and accessible financing to support future growth and industrial productivity.
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