Mr. Segun Ajayi-Kadir, Director-General of the Manufacturers Association of Nigeria (MAN), projected a challenging environment for manufacturers in the first half of 2024. He anticipates a gradual recovery from the third quarter onward.
Highlighting the sector’s challenges, Ajayi-Kadir underscored global manufacturing struggles due to economic variables. Nigeria experienced a decline in manufacturing growth, recording 0.48% in Q3 2023 against 2.4% in 2021, mirroring global trends observed in China, the USA, and South Africa.
He outlined projections for 2024, envisioning a sectoral real growth of about 3.2% and an economic contribution exceeding 10%. However, challenges like limited capacity utilization due to forex and inflation issues might persist until mid-year, potentially hovering around 50%.
Ajayi-Kadir expects improvements in manufacturing output by the third quarter, fueled by government investment in abandoned and new capital projects, prioritizing local products.
He foresees stability in the forex market, aided by rising global oil prices, domestic oil production, and gains from exchange rate unification. Moreover, the implementation of the Electricity Act 2023 is expected to bolster renewable energy investment, energy efficiency, and electricity supply for the manufacturing sector.
While 2024 may initiate with challenges, Ajayi-Kadir remains optimistic, citing potential policy reforms, increased commitment to domestic production, and a positive outlook as drivers that could lead to measured improvements for the sector by year-end.
