High inflation and reduced purchasing power of consumers led to more than N1.4 trillion unsold goods by manufacturers in 2024, the President of the Manufacturers Association of Nigeria (MAN), Francis Meshioye, has said.
Meshioye disclosed this yesterday, in Lagos, at the 2025 Presidential Media Luncheon organized by the association.
He stated: “In 2024, Nigeria’s manufacturing sector encountered a myriad of macroeconomic and infrastructural challenges that severely impacted its performance. The sector faced mounting pressure from high inflation, a depreciating Naira, rising interest rates, escalating electricity tariffs, record low sales, multiplicity of taxes and levies and militating security concerns. These factors collectively strained the sector’s profitability and curtailed its contribution to the nation’s gross domestic product (GDP).
“This inflationary burden also led to an accumulation of unsold inventory, which rose to N1.4 trillion across the manufacturing industries.”
The MAN president reeled out other challenges confronted by the sector in the year. According to him, the floating of the exchange rate which resulted in a steep depreciation of the Naira, led to inflated costs of imported raw materials and machinery, worsening the already strained profitability of manufacturers.
“Interest rates reached unprecedented levels, climbing to 27.7% by November 2024. This increase substantially raised borrowing costs, making it harder for manufacturers to access financing for expansion and modernization. The rising interest rates, combined with inflation, severely limited the potential for investment in the sector, impeding long-term growth prospects.
“Additionally, manu
facturers were hit hard with a drastic rise in electricity tariffs, with rates increasing by over 250%. This surge in energy costs became one of the highest operating expenses for businesses in the sector in 2024. As a result, many manufacturers sought alternative energy sources, further straining their financial resources and complicating their ability to remain competitive.
“Consequently, it cannot be far-fetched that the sector’s struggles were reflected in its decreasing contribution to Nigeria’s GDP.