Three Years of Tinubu: Industrial Growth Still Elusive for Manufacturers — MAN

Over the past three years, President Bola Tinubu’s administration has launched several economic and industrial reforms aimed at revitalizing Nigeria’s manufacturing sector, boosting local production, and attracting investment. From intervention funds to industrial roadmaps, local content policies, and foreign exchange reforms, the government has laid out an ambitious framework to stimulate industrial growth.

Yet, according to the Manufacturers Association of Nigeria (MAN), these policies have not yet translated into tangible improvements in industrial output or competitiveness.

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Policies Are in Place, But Impact Is Limited

Director-General of MAN, Segun Ajayi-Kadir, noted that the administration has addressed long-standing structural distortions and provided bold policy directions. However, manufacturers argue that policy announcements have not lowered production costs, improved efficiency, or created measurable industrial growth.

“The framework is strong, but the operating environment remains challenging,” Ajayi-Kadir said.

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N200 Billion Intervention Fund

One of the administration’s flagship initiatives is the N200 billion Presidential Intervention Fund, designed to support manufacturers and MSMEs. It includes:

• N75 billion Manufacturing Sector Fund
• N75 billion MSME Loan Scheme
• N50 billion Nano Business Support Scheme

The fund was intended to provide affordable financing to enterprises facing rising operational costs. While welcomed, MAN says high energy bills, exchange rate pressures, and expensive credit have limited its effectiveness.

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Nigeria Industrial Policy 2025

The Nigeria Industrial Policy (NIP) 2025 offers a ten-year roadmap for transforming the industrial sector, targeting a 20–25% contribution of manufacturing to GDP by 2030. The policy also proposes recapitalizing the Bank of Industry to N3 trillion to expand industrial financing.

Ajayi-Kadir acknowledged the significance of this framework but emphasized that its success depends on effective implementation and a supportive operating environment.

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‘Nigeria First’ Policy and Local Procurement

The administration’s ‘Nigeria First’ policy directs all government agencies to prioritise locally manufactured goods and services in public procurement. MAN views this as a potentially transformative policy that could stimulate domestic demand and deepen value chains.

However, Ajayi-Kadir cautions that consistent enforcement across all agencies is crucial to ensure real impact.

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Foreign Exchange Reforms and Manufacturing Costs

The unification of FX windows and liberalization of the naira exchange rate aimed to attract foreign investment and improve transparency. Manufacturers, however, report that the resulting naira depreciation has increased the cost of imported machinery, raw materials, and industrial inputs, squeezing profit margins and delaying expansion plans.

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Local Value Addition Legislation

A law requiring 30% minimum local value addition for certain agricultural and mineral exports has been passed by the National Assembly and awaits presidential assent. MAN supports the policy, noting that it can promote domestic processing, retain value within the economy, and create jobs along manufacturing value chains.

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2025 Tax Reform Act

The 2025 Tax Reform Act introduces fiscal incentives for manufacturers, including:

• Withholding tax exemptions
• Expanded VAT deductibility
• Phased reductions in corporate income tax
• R&D incentives
• Support for small businesses.

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Naira-for-Crude and Industrial Energy

The Naira-for-Crude initiative allows domestic refineries to purchase crude oil in naira, reducing pressure on foreign exchange and improving local energy supply. MAN acknowledges the relief this provides for downstream manufacturers, particularly in petrochemicals and plastics.

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Persistent Challenges

Despite these initiatives, manufacturers face significant headwinds:

• High energy costs and unreliable electricity supply
• Exchange rate pressures increasing import costs
• High borrowing costs and tight monetary policies
• Inflationary pressures affecting production and pricing

Ajayi-Kadir notes that diesel and petrol-powered alternatives remain necessary due to unstable power supply, adding to costs and reducing competitiveness.

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From Policy to Industrial Outcomes

For manufacturers, the question is no longer whether policies exist but whether they produce measurable results.

“The groundwork is laid, but macroeconomic stabilization must now lead to industrial recovery and growth,” Ajayi-Kadir said.

He emphasized that lowering production costs, supporting investment, and enhancing competitiveness are key to turning these reforms into tangible industry