Industrial machinery on a factory floor in Nigeria
The Manufacturers Association of Nigeria (MAN) has issued a stark warning that elevated borrowing costs are significantly impeding industrial expansion, investment, and overall productivity across the country. Despite a recent moderation in the Central Bank of Nigeria’s (CBN) benchmark interest rate, commercial lending rates remain prohibitively high, creating a substantial barrier for manufacturers seeking affordable financing.
This challenging financial environment compels many companies to self-finance essential infrastructure projects, leading to increased operating costs and a subsequent erosion of profit margins. Consequently, manufacturers are struggling to achieve optimal capacity utilization, further hindering their growth potential and contribution to the national economy.
In response to these persistent issues, MAN has formally urged the Central Bank of Nigeria to implement a reduction in lending rates specifically for industrial loans. Additionally, the association is advocating for a prioritization of foreign exchange allocation to manufacturers to facilitate the import of necessary raw materials and machinery. MAN also stressed the need for more effective implementation of policies designed to support local goods and a significant improvement in the power supply to industrial clusters, which remains a critical operational challenge.
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