- MAN projects that the outlook for the sector may not be positive, especially in the first half of 2024.
- The association expects dynamic implementation of the Electricity Act 2023.
The Manufacturers Association of Nigeria (MAN) has projected sectoral real growth to hit about 3.2 per cent and dynamic implementation of the Electricity Act in 2024. However, the association said the outlook for the manufacturing sector in 2024 may not be positive, especially in the first half of the year. According to the News Agency of Nigeria (NAN), MAN’s Director General, Mr Segun Ajayi-Kadir, who disclosed this in an interview on Tuesday in Lagos, projected that the year will be challenging, with a subtle possibility of recovery from the third quarter.
According to the MAN DG, the emerging upward surge in global oil prices, domestic oil and gas production, local refining of petroleum products, and projected gains of exchange rate unification would promote stability in the foreign exchange market. He stated that this would impact manufacturing positively from the second half of the year, reduce the pressure on demand for foreign exchange, and improve the inflow of export proceeds from oil and gas.
Ajayi-Kadir said, “Drawing from likely economic dynamics and in the light of the aforementioned, the projections for the manufacturing sector in 2024 are as follows: There will be clarity on the actual and specific policy direction and priority areas of the current administration, especially around deepening industrialisation and we look forward to engaging government in this regard.
“In 2024, sectoral real growth is expected to hit about 3.2 per cent; contribution to the economy will most likely exceed 10 per cent, and the Manufacturers’ CEOs Confidence Index is predicted to rise above 55 points threshold by the end of Q4 2023. Average capacity utilisation will still hover around the 50 per cent threshold as the foreign exchange related challenges and high inflation rate limiting manufacturing performance may linger until mid-year.”
“The sector may experience a meagre improvement in manufacturing output as foreign exchange and interest rates related challenges are expected to subside from the third quarter. We should expect dynamic implementation of the Electricity Act 2023, which will increase private investment in renewable energy, enhance energy efficiency and improve electricity supply to the manufacturing sector. The improved electricity supply will ameliorate the issue of inadequacy, reduce the disruptions occasioned by frequent outages and improve energy security,” he added.