Manufacturers in Nigeria are cautiously hopeful about the country’s economic outlook for the coming months, following a period of low confidence in August, according to the latest Business Expectations Survey conducted by the Central Bank of Nigeria.
The survey, which included 1,600 businesses, revealed that while the manufacturing sector was pessimistic in August, other sectors expressed optimism about the economy. However, manufacturers expect a slight improvement in September.
“The manufacturing sector is expected to see a slight improvement in confidence for September, with a projected index of 7.7 points. This anticipated improvement signals a potential rebound in business activity as companies look to adjust to the challenging operating environment,” the report stated.
In August, sectors like manufacturing and construction showed negative indices, with manufacturing at -5.5 points and construction at -10.0 points. This reflected a significant lack of confidence. On the other hand, sectors such as mining, quarrying, and electricity were more optimistic, showing an index of 30.4 points.
“For the subsectors, Mining, Quarrying, Electricity, Gas & Water Supply; Non-Market; Market showed optimism at 30.4, 2.7, and 0.7 points, respectively, while Construction and Manufacturing sectors were pessimistic at -10.0 and -5.5 points, respectively,” the report highlighted.
The survey pointed out that insecurity, high-interest rates, and multiple taxation are major challenges faced by businesses in Nigeria. Manufacturers also cited an unfavorable economic climate and insufficient power supply as significant obstacles.
The Manufacturers Association of Nigeria (MAN) has been vocal about these challenges. MAN’s Director-General, Segun Ajayi-Kadir, criticized the multiple taxes imposed by various government tiers and agencies, saying that they worsen the problems caused by foreign exchange volatility and high electricity tariffs.
Ajayi-Kadir added, “The challenges facing the manufacturing sector, particularly due to the current macroeconomic conditions, are exacerbated by the ongoing foreign exchange volatility and high electricity tariffs.”
