Monday, September 25, 2023
HomeBusinessManufacturing Sector Contributes N32.346 Trillion to Nigerian Economy in 5 Years

Manufacturing Sector Contributes N32.346 Trillion to Nigerian Economy in 5 Years

Available statistics have revealed that the manufacturing sector in Nigeria made a substantial aggregate contribution of N32.346 trillion to the country’s economy between 2018 and 2022. However, this contribution represents just 9.0 percent of the total cumulative Gross Domestic Product (GDP) of N358.232 trillion recorded during the same period, indicating the nation’s weak industrial base.

Data from the National Bureau of Statistics (NBS) shows that the nation’s GDP in real terms stood at N69.797 trillion in 2018, N71.387 trillion in 2019, N70.014 trillion in 2020, N72.393 trillion in 2021, and N74.639 trillion in 2022.

A breakdown of the data reveals that the manufacturing sector contributed N6.421 trillion in 2018, N6.470 trillion in 2019, N6.292 trillion in 2020, N6.502 trillion in 2021, and N6.661 trillion in 2022, representing 9.20 percent, 9.06 percent, 8.99 percent, 8.98 percent, and 8.92 percent of the GDP, respectively.

Stakeholders have expressed concerns about the infrastructural deficiencies that hinder the growth of Nigeria’s manufacturing sector. The inadequate power supply remains a significant constraint, forcing many firms to rely on expensive power generators, thereby increasing operational costs. Other challenges include scarcity of foreign exchange, limited access to credit, and rising costs of imported raw materials.

Ide John Udeagbala, President of the Nigerian Association of Chambers of Commerce, Industries, Mines and Agriculture (NACCIMA), commented on the situation, stating that having less than 10 percent of products produced through industrialized processes is detrimental to the country’s economic growth and development objectives. Udeagbala emphasized that industrialization is a crucial pathway to development.

Segun Ajayi-Kadir, Director General of the Manufacturers Association of Nigeria (MAN), highlighted the significance of manufacturing in national economic development. He stressed that countries that transform raw materials into finished goods and add value are the ones that prosper. Ajayi-Kadir called for the resolution of binding constraints that hinder the performance of the manufacturing sector and limit its contribution to the GDP. He emphasized the importance of addressing these issues to expand trade, commerce, and foreign exchange inflow.

Efforts to strengthen the manufacturing sector and address its challenges will play a pivotal role in Nigeria’s economic growth and the realization of its industrialization goals.



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