The Chemical and Non-Metallic Products Employers Federation, CANMPEF, has warned that rising production costs, multiple taxation, and foreign exchange volatility continue to threaten Nigeria’s industrial stability, even as manufacturers show resilience and innovation in adapting to the nation’s harsh economic realities.

Presenting the President’s Report at the Federation’s 46th Annual General Meeting, AGM, in Lagos, the President of CANMPEF, Chief Devakumar Edwin, said despite daunting macroeconomic challenges, the sector recorded modest growth in 2024, driven by local resource utilisation, product diversification, and expanding regional export opportunities.

He said the Federation’s outlook for 2025 would focus on a new industrial agenda anchored on aggressive advocacy for infrastructure development, local value chain strengthening, and enhanced regulatory engagement to support long-term growth.

According to Edwin, Nigeria’s economy demonstrated resilience in 2024, expanding by 3.84 per cent in the fourth quarter to reach N22.61 trillion, with growth driven largely by the non-oil sector, especially financial and insurance services. However, inflationary pressures and currency depreciation continued to undermine industrial competitiveness.

He said “The business environment remained constrained by high input costs, multiple taxation, and limited access to foreign exchange. Despite these headwinds, CANMPEF members showed remarkable adaptability — optimising resource use, innovating around local material sourcing, and exploring regional markets.”

He noted that the removal of fuel subsidy and floating of the Naira, though designed to stabilise the economy, significantly escalated energy and import costs, squeezing margins across industries.

Citing the Central Bank of Nigeria’s (CBN) Q4 2024 Economic Report, Edwin said the manufacturing sub-sector grew modestly by 1.79 per cent year-on-year, driven by product diversification and increased local sourcing, even as average capacity utilisation rose to 61.9 per cent.

He noted that the exchange rate, which averaged N1,623.26 to a dollar, reflected a 2.13 per cent depreciation, while headline inflation climbed to 34.8 per cent, driven by high energy costs and exchange rate volatility.