The leadership of Nigeria's manufacturing sector has issued a critical appeal to the Federal Government, urging the creation of a special financing window to rescue factories from high borrowing costs. The Manufacturers Association of Nigeria (MAN) is pushing for a facility that will allow its members to access loans at single-digit interest rates, a move seen as vital for revitalizing the industry in 2026.
Core Demands: Affordable Credit and Policy Consistency
Outlining the association's expectations for the year, MAN's Director General, Segun Ajayi-Kadir, made a specific proposal. He wants commercial banks to provide credit to manufacturers at rates below 10 percent, with loan repayment periods extending up to seven years. This, he argues, is essential for long-term capital investment and growth.
Ajayi-Kadir acknowledged some positive economic indicators, noting that the foreign exchange rate has shown stability and manufacturing capacity utilisation has remained consistent. The Central Bank of Nigeria (CBN) has also held benchmark rates steady. However, he was quick to highlight that deep-seated challenges continue to plague the sector.
Persistent Challenges: From Insecurity to High Costs
The MAN DG identified several key obstacles. Insecurity, particularly in the northeast and north central regions, has severely disrupted logistics and supply chains. While reduced diesel and petrol prices—partly due to the Dangote refinery's operations—have offered some relief, rising electricity costs remain a major concern for factory operators.
On a positive note, Ajayi-Kadir commended the new tax regime which aims to reduce the number of taxes payable by manufacturers from 63 to about 10. He expressed hope that this would significantly benefit small and medium-scale industries, with the smallest enterprises being exempted from withholding tax, VAT, and company income tax.
Urgent Interventions and a Pre-Election Warning
Beyond financing, Ajayi-Kadir emphasized other urgent interventions. He called for the swift implementation of the Nigerian content policy announced by President Bola Tinubu in 2025, urging all ministries, departments, and agencies (MDAs) to patronize locally-manufactured goods.
He also pushed for further interest rate cuts by the CBN, stating that borrowing at 35 to 36 percent is unsustainable and stifles growth. Controlling inflation and maintaining the exchange rate below N1,400/$1 were also stressed as necessary to reduce production input costs.
With 2026 being a pre-election year, Ajayi-Kadir issued a pointed warning to the administration. He urged the government to maintain its focus on economic reforms despite impending political pressures. He argued that the administration cannot afford to sacrifice hard-won economic progress for political expediency, especially after implementing difficult reforms that initially caused significant disruption.
"A lot of reforms have settled down, the growth prospects are there, the economic indicators are looking right or can be made right quickly," he said. He concluded that sustained economic focus would ultimately serve the enlightened political interest of the president and the nation.
