Nigeria’s manufacturers say increased government capital expenditure has yet to translate into a significant improvement in factory productivity, even as business confidence showed a modest recovery in the second quarter of 2026.
The Manufacturers’ Association of Nigeria said its Manufacturers’ CEOs Confidence Index rose by 3.4 points from 48.7 in the first quarter to 52.1 in the second quarter, indicating a return to positive sentiment among manufacturing executives.
Despite the improvement, manufacturers remained dissatisfied with the cost and availability of bank credit, foreign exchange access, regulatory pressure and persistent congestion at the ports.
The chief executives blamed high lending rates largely on the Central Bank of Nigeria’s Monetary Policy Rate of 26.5 per cent, arguing that expensive borrowing continued to limit investment and expansion in the real sector.
They also said public infrastructure spending had not yet produced a noticeable impact on productivity. The report, however, acknowledged that capital projects generally require time before their full benefits are felt by businesses.
Manufacturers were less sympathetic about foreign exchange constraints, maintaining that the expected benefits of exchange rate liberalisation should have become more visible after more than three years.
Uncertainty over the implementation of the Nigeria Tax Act 2025 also remained a concern, while port congestion continued to delay the importation of machinery, spare parts and production materials.
The report noted some improvement in local sourcing but said patronage of locally manufactured products by ministries, departments and agencies remained weak, contributing to high inventories.
MAN recommended that the CBN reduce the MPR to below 20 per cent for productive-sector credit, improve foreign exchange access for manufacturers and strengthen the Bank of Industry’s capital base.
It also urged the Federal Government to give stronger legal backing to policies promoting Made-in-Nigeria products and to support manufacturers seeking alternative energy sources such as gas and solar power.
