Nigeria’s manufacturing sector generated N9.16tn in nominal terms in the third quarter of 2025, but industry leaders say the growth remains too weak to support broad economic development. The latest GDP report from the National Bureau of Statistics shows the sector recorded a 1.25 per cent growth rate, which the Manufacturers Association of Nigeria described as slow and far below what is needed to drive real industrial expansion.
The NBS figures show that manufacturing’s nominal contribution rose by 3.45 per cent, up from N8.85tn recorded in the third quarter of 2024. Manufacturing in Nigeria covers 13 subsectors, including food and beverages, cement, basic metals, plastics, textiles, and oil refining.
Speaking with the source, the Director-General of the Manufacturers Association of Nigeria, Segun Ajayi-Kadir, said the overall GDP growth of 3.98 per cent for the period “does not reflect transformative expansion.” According to him, manufacturing is too weak to anchor inclusive and sustainable progress.
Ajayi-Kadir said, “An aggregate growth of 3.98 per cent is not transformative. Manufacturing, which is supposed to be the engine that drives mass employment and inclusive prosperity, remains largely sluggish. The sector grew by only 1.25 per cent in Q3 2025 from 0.76 per cent in Q3 2024. Growth without productive capacity is sub-optimal and lacks inclusivity.”
A quarter-on-quarter comparison also showed that the sector’s real growth rate declined by 0.35 percentage points, falling from 1.60 per cent in Q2 2025. Ajayi-Kadir noted that this drop further highlights the weakness in the system. “Any GDP growth without a corresponding elevation in manufacturing output does not portend a robust advancement,” he added.
According to the NBS, eight manufacturing activities improved year-on-year, while five posted declines in their real growth. The subsectors that declined include Wood and Wood Products (1.64 per cent), Chemical and Pharmaceutical Products (3.75 per cent), Non-Metallic Products (1.51 per cent), Electrical and Electronics (1.17 per cent), and Other Manufacturing (1.45 per cent).
Despite signs of improvement, two other subsectors—Textile, Apparel and Footwear, and Pulp, Paper and Paper Products—remained in recession. They contracted by 2.41 per cent and 1.07 per cent, respectively, showing that recovery remains slow.
The biggest contributor within manufacturing was Food, Beverage, and Tobacco, which generated N3.08tn. Oil refining ranked lowest in terms of nominal contribution at N2.69bn, although it recorded the highest real GDP growth rate of 19.42 per cent in the quarter.
Ajayi-Kadir said the overall sluggish performance continues to reflect “persistent structural pressures” facing manufacturers. These pressures include high energy costs, difficulty accessing foreign exchange, and high interest rates. He said unreliable power supply remains a major barrier, noting that the cost of alternative energy “surged by 67 per cent from N404.8bn in H2 2024 to N676.5bn in H1 2025.”
He added that foreign exchange liquidity remains limited, with manufacturers accessing “only 51 per cent” of their forex needs from the official window. Borrowing has also become increasingly difficult, as interest rates of 37 per cent mean many small and medium manufacturers cannot expand or even sustain operations.
In his recommendations, Ajayi-Kadir urged the Federal Government to take urgent steps to support the sector. He called for a gradual reduction in interest rates, swift disbursement of the N1tn Industrialisation Stabilisation Fund, and strict enforcement of the Nigeria-First Policy to protect local manufacturers.
He maintained that Nigeria cannot build a strong, competitive, and job-creating economy if manufacturing remains weak. “Manufacturing must be prioritised, protected, and deliberately powered to lead Nigeria’s economic transformation,” he said.
Ajayi-Kadir also pointed to positive developments in sectors such as solid minerals and oil, which recorded some of the highest growth figures. These include Quarrying & Other Minerals (39.49 per cent), Coal Mining (57.96 per cent), Oil Refining (19.42 per cent), Metal Ore (59.11 per cent), and Financial Institutions (19.46 per cent).
He said the improvements were partly due to major policy interventions, including the extra N1tn allocation to solid minerals, investment protection reforms, and rising global demand for critical minerals. Oil-sector growth, he added, was boosted by increased local refining from the Dangote Refinery and modular refineries, expanded gas processing, and the rollout of CNG adoption.
Private sector experts have also expressed concerns about Nigeria’s slow industrialisation. The Chairman of the Alliance for Economic Research and Ethics, Dele Oye, and Chief Economist at SPM Professionals, Dr Paul Alaje, previously warned that weak electricity supply, poor infrastructure, and unfriendly policies continue to hinder growth.
In his analysis, the Director of the Centre for the Promotion of Private Enterprise, Dr Muda Yusuf, described manufacturing as “still fragile and under pressure.” He said, “High energy and logistics costs, costly borrowing conditions, dependence on imported inputs, and smuggling continue to erode competitiveness.”
Yusuf added that although Nigeria’s economy shows signs of recovery, achieving strong and inclusive growth will require addressing long-standing structural challenges in manufacturing, agriculture, and trade.
