Otunba Francis Meshioye, the President of MAN, emphasized that the future of the manufacturing sector and the broader economy in 2025 hinges significantly on the successful implementation of these economic reforms, particularly the proposed tax changes.
Meshioye made these remarks during the ninth edition of the MAN Media Personality of the Year Award and the 2025 Presidential Media Luncheon, which took place at MAN House in Ikeja, Lagos.
He highlighted that, in addition to the swift approval of the tax reform bills, stabilizing key macroeconomic indicators and focusing on investments in infrastructure and technology are essential for revitalizing both the sector and the economy this year.
The MAN President noted that, given the ongoing fiscal and monetary reforms by the current administration, “the contraction of the economy is expected to ease and experience some growth this year with stability in the exchange rate regime in 2025.”
He also pointed out that the effective integration of Artificial Intelligence (AI) is poised to transform the manufacturing sector in 2025 and beyond.
“This (AI adoption) is expected to help engender enhanced production and productivity, improved capacity utilization, innovative product development, improved inventory system, efficient logistics operations etc.,” Meshioye said.
He added that technology adoption, driven by research and development, is projected to accelerate the real sector's anticipated transformative growth.
“As manufacturers, we are gearing up and ready to embark on this interesting journey on the path of growth,” he stated.
The president of MAN outlined additional strategies to support the manufacturing sector and stimulate economic recovery this year. He emphasized the importance of maintaining efforts to boost productivity and strengthen competitiveness.
He stressed that these initiatives are essential for assisting Nigerian manufacturers in overcoming the obstacles they encounter. "Manufacturing plays a critical role in driving and sustaining Nigeria's economic growth and development."
Inflation in Nigeria surged to a concerning 34.6 percent by November 2024, significantly eroding consumers' purchasing power and leading to a decrease in demand for manufactured products, according to Meshioye. He expressed concern that this inflationary pressure resulted in a buildup of unsold goods, which reached N1.4 trillion across the manufacturing sector.
In addition to the challenges posed by high inflation, manufacturers faced a range of macroeconomic and infrastructural issues that adversely affected their operations. These challenges included the depreciation of the naira, increasing interest rates, soaring electricity costs, historically low sales, a complex tax environment, and ongoing security threats.
Meshioye noted that these factors collectively hindered the sector's profitability and diminished its contribution to the nation's Gross Domestic Product (GDP). As a result, the manufacturing sector's share of the economy fell sharply from 16.04 percent in Q4 2023 to 12.68 percent in Q2 2024, reflecting a contraction in economic activity.
He attributed this decline primarily to the combination of high operational costs, decreased consumer demand, and restricted access to financing. Looking ahead to 2025, however, he projected that Nigeria's overall economic growth could reach approximately four percent, representing a modest recovery compared to previous years, although still below the average growth rate for sub-Saharan Africa.
To foster economic growth, Meshioye recommended several measures, including the promotion of locally made products, ensuring food security, encouraging local sourcing of raw materials, and addressing inconsistencies in policy.
He emphasized the importance of enhancing infrastructure, including roads and railways, advancing energy security, reducing electricity tariffs, swiftly addressing the backlog of foreign exchange forwarded by the CBN, and ensuring lower lending rates along with improved access to credit.