Manufacturing capacity utilisation contracted further by 0.8 per cent in the fourth quarter (Q4) of last year from the -1.3 per cent drop witnessed in the preceding quarter. Manufacturing investment also dipped by 1.2 per cent from 3.5 per cent contraction recorded in Q3 of the same period.
Save for sales volume, which recorded a favourable change during the period of review, rising slightly by 1.1 per cent compared to the 0.4 per cent decline witnessed in the preceding quarter, Manufacturers Association of Nigeria (MAN) CEO Confidence Index (MCCI) report said other key manufacturing indicators witnessed contraction.
The MCCI serves as a gauge for assessing quarterly shifts in manufacturing activities, influenced by macroeconomic trends and government policies.
MCCI is, therefore, the barometer used by MAN to garner the perceptions of CEOs of manufacturing companies on the impact of changes in the economy on manufacturing operations.
The MCCI report said volume of production dropped by 0.3 per cent in Q4 from a contraction of 3.2 per cent recorded in Q3 2024; production and distribution costs surged further by 18.2 per cent in the quarter under review, from the 20.1 per cent increase witnessed in the preceding quarter.
Also, manufacturing employment declined by 0.7 per cent in Q4 2024 compared to 3.5 per cent contraction recorded in the preceding quarter, while cost of shipment rose by 11.6 per cent in Q4 2024 from the 17 per cent increase recorded in Q3 2024.
MAN Director-General Mr. Segun Ajayi-Kadir said most of the key manufacturing indicators recorded lower adverse changes compared to the previous quarter because the indicators were diminished by the adverse effects of the prevailing macroeconomic reforms.
He said during the survey, manufacturers identified and ranked the challenges facing their operations in order of severity.
Ajayi-Kadir listed manufacturers’ top 10 challenges in Q4 2024 to include exorbitant electricity tariff hike and high cost of alternative energy; high exchange rate & forex scarcity; high cost and shortage of raw materials; multiple taxation; and government over-regulation & policy inconsistency.
Others are high interest rate & low access to credit; poor road infrastructure & high cost of logistics; insecurity & political instability; low sales & low patronage by government agencies; and high inflation.
