CPPE: Nigeria Manufacturing Revival Hinges on Managing Structural Risks, Macroeconomic Stability 

Dike Onwuamaeze

The Center for the Promotion of Private Enterprise (CPPE) has stated that the revival of Nigeria’s manufacturing sector in 2026 and beyond is hinged on managing structural risks and sustained macroeconomic stability.

The Chief Executive Officer of CPPE, Dr. Muda Yusuf, stated this in a statement titled “Nigeria’s Manufacturing Sector: Outlook, Risks and Policy Priorities (2026).”

Yusuf said: “Nigeria’s manufacturing revival hinges on managing structural risks while sustaining macroeconomic stability. If reforms in power, trade, and development finance are effectively implemented, the sector’s growth prospects and competitiveness will be significantly enhanced in 2026 and beyond.”

He added, “Given the import-dependent nature of Nigerian manufacturing, foreign exchange (FX) stability alone offers meaningful relief on input costs and planning certainty.”

Commenting further on the sector’s outlook, Yusuf said that business expectations in the manufacturing sector in 2026 must be carefully managed because structural bottlenecks in energy, logistics, and ports could not be resolved within a single fiscal year.

He, however, noted that “the improving macroeconomic fundamentals are expected to support better manufacturing outcomes in 2026, especially for firms that are amenable to backward integrated, less exposed to FX volatility and better aligned with domestic input sourcing.

He said, “These segments are likely to record stronger returns on investment under current reform conditions.”

The CPPE said that the challenges confronting Nigeria’s manufacturing sector have remained largely unchanged over the years.

“They are predominantly structural, not cyclical, and therefore require medium- to long-term solutions rather than quick fixes.

“These constraints continue to undermine competitiveness, investment returns, and industrial growth,” CPPE said.

Yusuf said that the key challenges facing manufacturers in Nigeria included inadequate and costly infrastructure, particularly power and logistics; port inefficiencies and supply chain bottlenecks; high cost of energy, driven by reliance on captive power and unfavourable regulatory and business environment.

Others, according to him, are unfair competition from cheap imports, especially from Asia, high cost of funds and absence of long-tenured financing, and weak consumer purchasing power.

“These issues have kept manufacturing costs high and weakened competitiveness relative to imported goods,” he said, adding that “without addressing these risks, Nigeria’s manufacturing sector will remain structurally uncompetitive,” he said.

He also noted that the relief is that while these structural constraints have continued to persist, the macroeconomic environment has improved notably over the past year.

He said: “Greater foreign exchange market stability, with prospects of gradual appreciation and the deceleration in inflation could eventually translate into lower interest rates.”

Yusuf said that the policy priorities for 2026 should be sustained macroeconomic stability, fixing the power sector value chain, improving access to long term fund,  deployment of smart trade and protection policies and deepening the”Nigeria First” policy implementation.

He, therefore, advised government to “maintain FX market stability and reform momentum, avoid disruptive policy reversals, strengthen gas supply, generation, transmission, and distribution.

He said that government should empower Development Finance Institutions (DFIs) to provide lower-cost funds, longer tenors suited for manufacturing, which “s essential to address clear market failures in commercial finance.

Yusuf said: “Protect domestic manufacturers without harming consumer welfare. Encourage competition among manufacturers, not between manufacturers and importers.”

He also charged the government to move beyond rhetoric to enforcement of the Nigeria First policy by using “public procurement at federal and state levels to prioritise Made-in-Nigeria goods.”