The manufacturing sector’s contribution to Nigeria’s non-oil exports has experienced a significant decline of 62% over the past four years. Data from the latest foreign trade report reveals that manufacturing exports’ share of total exports dropped from N2.1 trillion in 2019 to N778.4 billion in 2023.
Manufacturers attribute this decline to various factors, including rising production costs, unfavorable business environment, and increased competition. Challenges such as high energy costs, inadequate infrastructure, financing difficulties, inconsistent government policies, and skill shortages have contributed to the sector’s lack of competitiveness.
Sola Obadimu, the director-general of the Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture, highlighted additional challenges such as FX volatility, accelerating inflation, and worsening insecurity, which are further impacting manufacturers’ growth.
Without addressing these issues, the sector’s contribution to exports will continue to decline, potentially leading to the departure of some multinational companies.
Source: Business Day