By Barnabas Esiet.
Nigeria’s economy recorded a modest growth rate of 3.46% in the third quarter of 2024, compared to 2.54% in the same period of 2023 and 3.19% in the previous quarter.
The National Bureau of Statistics attributed this growth primarily to the performance of the Services sector.
The Services sector grew by 5.19% and contributed 53.58% to the GDP during the same period.
The industrial sector recorded a growth of 2.18%, an improvement from the 0.46% recorded in the third quarter of 2023.
However, the manufacturing sector was one of the least growing sectors during the period under review, with a growth rate of 2.18%.
According to the National Bureau of Statistics, the manufacturing sector’s growth rate declined by 90.11% in the third quarter of 2024, compared to the same period in 2023.
The sector’s contribution to GDP also declined to 8.21% in the third quarter of 2024, down from 8.42% in the same period of 2023.
The Manufacturers Association of Nigeria (MAN) has expressed concern over the slow growth of the manufacturing sector, citing hostile economic policies as a major constraint.
The association noted that the sector faces numerous challenges, including multiple taxation, limited access to credit, an unstable foreign exchange market, infrastructure deficits, and energy insecurity.
MAN has recommended several measures to address the challenges facing the manufacturing sector.
These include creating special windows for providing single-digit interest rates to productive sectors, recapitalizing the Bank of Industry (BOI), enhancing credit information systems, and implementing the recommendations of the Presidential Fiscal Policy and Tax Reforms Committee.
Other recommendations include reducing the excessive increase in Environmental Impact Assessment (EIA) and Effluent Discharge (EMP) fees imposed by NESREA, retaining the current excise duty of N10 per liter on non-alcoholic beverages, and directing the Central Bank of Nigeria to clear $2.4 billion outstanding dollar obligations on FX forward contracts to support manufacturers.
MAN also called on the government to prioritize budgetary allocation for infrastructure development, especially along strategic economic hubs, and to encourage public-private partnerships for infrastructure development.
While Nigeria’s economy has recorded a modest growth rate in the third quarter of 2024, the manufacturing sector remains a major concern.
Industry experts are unanimous that government must take decisive action to address the challenges facing the sector, including hostile economic policies, multiple taxation, limited access to credit, and infrastructure deficits.
By doing so, they believe that government can unlock the potential of the manufacturing sector and drive economic growth and prosperity.
Comment here