The Nigerian manufacturing sector is grappling with significant hurdles in 2024, marked by a slight dip in real output and capacity utilization.
The latest report by the Manufacturers Association of Nigeria (MAN) underscores the sector’s ongoing struggles with high operational costs, inflationary pressures, and a constrained foreign exchange market.
Despite these challenges, manufacturers have shown resilience by increasingly shifting towards local raw material sourcing to mitigate import difficulties.
MAN President, Otunba Francis Meshioye, presented the report, highlighting a marginal drop in capacity utilization to 56.4 per cent in the first half (H1) of 2024, compared to 56.5 per cent during the same period in 2023.
Nonetheless, the sector experienced a modest recovery from the second half (H2) of 2023, marked by a 2.8 per cent increase in capacity utilization—a signal of potential stabilization despite the broader economic headwinds.
“Real manufacturing output in Nigeria declined by 1.66 per cent year-on-year in the first half of 2024, falling to N1.34 trillion from N1.36 trillion in the first half of 2023,” Meshioye stated.
He noted that while real output showed a downturn, there was a 9.97 per cent increase compared to H2 2023, attributed to baseline effects that cushioned the decline.
In nominal terms, the sector’s output surged by 30.38 per cent year-on-year, reaching N5.34 trillion in the first half of 2024, a reflection of rising domestic prices driven by inflation.
Meshioye pointed out that the Consumer Price Index (CPI) had soared to 34.19 per cent as of June 2024, contributing to the substantial increase in nominal values.
