After a challenging 2025 marked by consecutive quarterly declines of up to 1.25% in real growth, Nigeria’s manufacturing sector is poised for a rebound. Stakeholders, including the Manufacturers Association of Nigeria (MAN) and the Centre for the Promotion of Private Enterprise (CPPE), project that the sector could achieve a 3.1% real growthnext year, raising its contribution to the country’s GDP to 10.2%—if key policy reforms and incentives are effectively implemented.
According to MAN’s 2026 outlook, this projected improvement depends on the operationalisation of the National Single Window Project, effective execution of new tax incentives, and the purposeful implementation of the Nigeria Industrial Policy under the Nigeria First framework. MAN Director-General, Segun Ajayi-Kadir, described the forecast as a gradual recovery, noting that lower inflation, stable energy costs, and currency appreciation could provide a supportive environment for manufacturers.
MAN also highlighted potential improvements in macroeconomic conditions that directly affect production. The naira is expected to appreciate to N1,300–N1,400 per dollar, supported by rising global oil prices, stronger reserves, improved exports, higher remittances, and foreign investment. Inflation is projected to moderate to 14% in 2026, while the Central Bank of Nigeria may lower the Monetary Policy Rate to around 23%, stimulating credit growth and capacity expansion in the sector.
The CPPE echoed these projections but cautioned that structural challenges could limit growth. Director Dr. Muda Yusuf noted that issues such as high energy and logistics costs, short-term financing, and unmanaged import competition are long-term constraints that require medium- to long-term solutions. Nevertheless, firms with strong domestic input sourcing and minimal exposure to foreign exchange risks are expected to benefit most from the improving business environment.
Both MAN and CPPE agree that Nigeria’s manufacturing revival will hinge on sustained policy reforms, macroeconomic stability, and strategic government support. Measures such as ensuring reliable power supply, facilitating affordable long-term financing, and enforcing domestic procurement through the Nigeria First policy could significantly boost the sector’s competitiveness, helping it play a more pivotal role in Nigeria’s economic growth in 2026.
source: punch