- Say high credit costs choke industry
- Without local investors, foreigners won’t invest in Nigeria – Dangote
- Electricity access, security key to drawing investment to Nigeria, Elumelu tells FG
- Nigeria ranks 146 out of 191 countries on GDP per capita, says World Bank
The Manufacturers Association of Nigeria has expressed growing alarm over the Central Bank of Nigeria’s sustained monetary policy stance, warning that the current interest rate regime is undermining the country’s manufacturing base and economic resilience.
In a statement issued on Wednesday, MAN Director General, Segun Ajayi-Kadir, said the decision by the CBN to retain the Monetary Policy Rate at 27.5 percent since November 2024 is out of step with global economic trends, where many nations are reducing interest rates to support growth and industrial recovery.
“We are perturbed that when most progressive economies are charting a course toward industrial recovery and macroeconomic stability, Nigeria’s monetary stance tends to lead us in a different direction.
“Over the last quarter, countries such as members of the Euro Area, the United Kingdom, Denmark, Australia, China, India, Thailand and Egypt, have implemented interest rate cuts to bolster economic growth and support productive sectors. Yet, our rigidity continues to create unintended consequences that may deepen the parlous performance of the productive sector,” Ajayi-Kadir said.
He pointed out that with credit priced as high as 37 per cent, Nigeria ranks among the most expensive environments globally for manufacturers seeking loans.
“A nation cannot industrialise on the back of prohibitively expensive credit,” he warned, stating that the policy has become “inflationary” and is “suffocating the capacity of the manufacturing sector.”
He noted that small, medium, and large-scale manufacturers are struggling to meet operational costs and sustain production, as rising borrowing costs lead to underutilization of industrial capacity and declining investment returns.
He stressed that when credit is priced highly, production declines and the nation imports poverty.
Ajayi-Kadir also raised concerns about the broader impact on the government’s “Nigeria First Policy,” which promotes local industry and reduces import dependence.
According to him, financing costs for MAN members surged by over 44 per cent from ₦1.43 trillion in 2023 to ₦2.06 trillion in 2024, a development that has directly suppressed productivity.
The downturn in manufacturing confidence was reflected in the decline of the Manufacturers’ CEO’s Confidence Index, which fell from 50.7 to 48.3 points.
Ajayi-Kadir questioned the emphasis on attracting foreign portfolio investment while domestic industries struggle to survive.
“A nation that woos foreign portfolio investors at the expense of its real sector may unwittingly be aspiring to build prosperity on the back of volatility.
“While maintaining a high interest rate of 27.5 per cent may temporarily attract speculative foreign portfolio investors, it is doing so at the expense of Nigeria’s manufacturing base, which is now choked by unsustainable borrowing costs,” he said.
He highlighted the widening profitability of the banking sector in contrast with the challenges facing manufacturers.
“This is an economic paradox that must be urgently addressed. The current monetary policy trajectory risks turning banks into vaults of idle wealth, while the real economy, where jobs are created and value is added, faces suffocation,” he said.
Ajayi-Kadir maintained that affordable credit is essential for industrial growth and called on the CBN to urgently revisit its monetary policy.
He argued that recent disinflation trends and improved real interest rates already provide investors with better inflation-adjusted returns, making the high nominal rate unnecessary.
He stated, “Maintaining a high nominal interest rate under current inflation conditions is neither necessary nor justifiable, and will only prolong the pain for manufacturers and consumers alike.”
MAN’s key recommendations to the CBN include a significant cut in the benchmark interest rate; policy incentives for commercial banks to offer single-digit, concessionary interest rates to manufacturers; the release of the ₦1 trillion Stabilization Fund to support struggling industries; an increase in the Bank of Industry’s capital base; and the settlement of the $2.4 billion in outstanding Forex Forward Contracts to restore confidence and access to essential imported inputs.
Ajayi-Kadir also urged the government to provide a stable customs duty exchange rate for industrial raw materials and machinery, in order to prevent further inflationary impacts on the sector.
“Industrial confidence is a fragile currency and once broken, it takes time to rebuild.
“Nigeria cannot afford to lose its manufacturing momentum at a time when the world is repositioning for the next wave of industrial transformation.”
He warned that unless urgent measures are taken, the current monetary policy could undermine national economic resilience.
He pointed out that the administration’s commendable reforms are being hampered by persistently high costs and limited access to funds, which is eroding manufacturers’ confidence and jeopardising the nation’s economic stability.
Without local investors, foreigners won’t invest in Nigeria – Dangote
Also, the President of the Dangote Group, Aliko Dangote, has advised the federal and state governments to patronize local investors for economic development.
He gave the advice at the Taraba International Investment Summit in Jalingo, which attracted investors from across Nigeria and beyond.
Africa’s richest man said domestic investors are the ones who will attract foreign investors, as according to him, no foreign investors would come into a country where local businesses are not thriving.
“I want to give a word of advice, Your Excellency, the only way for you to attract foreign investments or investors is by having local investors. Domestic investors are the ones who actually attract foreign investors.
“If you don’t invite local investors to come and invest, no foreigner will come and invest. Foreigners are attracted only when they see prospects for investment. Once they see that, yes, things are flowing, you don’t have to invite them, they will come,” Dangote said.
He further disclosed that the Federal Government benefits fifty-two kobo for every One Naira he makes from his Dangote Cement Factory.
“I’m sure it might interest you to know that the Federal Government of Nigeria, not even the state, makes more money from, for example, our cement business. For every N1 that we turn around, 52 kobo goes to the Federal Government of Nigeria. So, that’s the benefit. When the government facilitates, they give you what it takes to create your own business. What we should do, also, is behave and pay your taxes.
“So, I want to encourage the government to continue to encourage investment, especially domestic investment. If you encourage, you have more investment. If you don’t encourage, there will not be jobs,” he maintained.
Dangote commended Governor Agbu Kefas for organising the Investment Summit, which he noted would open Taraba up for investments.
According to him, Taraba state is endowed with resources, including a vast arable land for agricultural production, which he said would create jobs and reduce poverty in the state and the country as a whole.
He assured that his organisation would invest in Taraba State.
“We will invest in Taraba State. We will not go anywhere and invest. This is home. We will keep creating jobs,” he added.
Electricity access, security key to drawing investment to Nigeria, Elumelu tells FG
Also, the Chairman of Heirs Holdings, Tony Elumelu, has emphasised that improving access to electricity as well as improving security are so critical to attracting investments to the country.
Elumelu, who spoke at the Taraba International Investment Summit in Jalingo on Wednesday, also stressed the importance of ease of doing business in attracting investors.
“Improving access to electricity is so critical in attracting and supporting investments in the country. Improving the security also helps, and most importantly ease of doing business,” Elumelu said at the summit organised by the Taraba State Government.
He said that the reason he loves and preaches investment everywhere he goes is because it has many benefits, one of which is engaging the youths.
He stated that employment is one of the surest ways of empowering the young people, adding that it is a betrayal of a generation for people to leave school without being able to find jobs.
Elumelu also commended the President Bola Tinubu-led Federal Government for currency stability, but stressed the need to further bring the exchange down.
“I must also say that yesterday in Doha, one of the questions they asked me was about currency. I commended the Federal Government of President Bola Tinubu that we have stability now, not that the rate is not high but stability.
“And investors like when there is stability so they can plan ahead. I want to see us do well and further bring the currency down,” Elumelu said.
The event attracted investors from across Nigeria and beyond, with Vice President Kashim Shettima representing President Tinubu.
Nigeria ranks 146 out of 191 countries on GDP per capita – World Bank
However, the World Bank said Nigeria, with an annual GDP per capita of $6,207 in current international dollars, ranks 146 out of 191 countries.
The bank, in its May 2025 edition of Nigeria Development Update launched last week in Abuja, said Nigeria’s annual GDP is equivalent to just 4.4 per cent of the per capita income of the leading country, Singapore or 30 per cent of the leading continental African country, Botswana.
The report said that though Nigeria’s economy is gradually picking up, the government must accelerate on a sustained basis to reduce poverty and meet the aspirations of Nigerians.
According to the report, “From a static perspective, Nigeria’s economy needs to grow to boost incomes and meet aspirations. If Nigeria’s current annual economic output was equally distributed, this would be sufficient to eliminate poverty, but it would still leave Nigerians far behind the global prosperity frontier.”
It said with an estimated population in 2024 of about 232.7 million people and a GDP of N277.5 trillion, each Nigerian would have taken home N1.2 million, or about N100,000 per month, if output was divided equally.
“This would imply a standard of living equivalent to almost four times the current poverty line, a huge improvement for the close to 60 percent of Nigerians who live in families whose breadwinners are not able to produce and earn enough to escape poverty,” the Bank said, adding, “Yet, even if it was divided equally in this way, and adjusting for differences in prices across countries, current annual output is not enough to make Nigerians prosperous.”
The issue of poverty has been a challenging one for Nigeria as the rising inflation, high interest rates, and insecurity have worsened the cost of living crisis in the country.
In 2022, the National Bureau of Statistics in its multidimensional poverty index (MPI), estimated that about 63 per cent or 133 million Nigerians are multidimensionally poor.
The World Bank, in its April 2025 Poverty and Equity Brief for Nigeria, disclosed that a staggering 75.5 per cent of rural Nigerians are now living below the poverty line, reflecting deepening hardship in the country’s hinterlands.
The report paints a grim picture of worsening economic hardship, widening inequality, and persistent underdevelopment across much of the nation.
While poverty is widespread among urban populations, the report emphasised that the situation is significantly worse in rural areas, where economic stagnation, high inflation, and insecurity have exacerbated living conditions.
“Based on the most recent official household survey data from the National Bureau of Statistics, 30.9 percent of Nigerians lived below the international extreme poverty line of $2.15 per person per day in 2018/19 before the COVID-19 pandemic,” the report stated.
The bank in the NDU noted that efforts to urgently provide support to the poorest and most economically at risk households should be redoubled and expanded.
It acknowledged the government’s effort to alleviate the added cost of living pressures by the launch of the social assistance programme with the goal of supporting 15 million households with time-bound cash transfers.
However, the report noted that roll-out has been slow, with only 5.6 million households reached so far.
While calling for acceleration of the process, the report noted that alongside macroeconomic reforms and emergency cash support, stronger growth and a robust social protection framework are essential to promote productive livelihoods.