The Manufacturers Association of Nigeria (MAN) has raised fresh concerns over the country’s rising production costs, warning that Nigerian factories are paying up to 10 times more for electricity than manufacturers in parts of Asia, making it increasingly difficult for local industries to compete globally.
Speaking on the challenges facing the manufacturing sector, industry leaders said businesses in Nigeria face significantly higher costs for electricity, financing and logistics compared with competitors in countries such as China and Vietnam. According to the association, these cost disparities are eroding profit margins, discouraging investment and weakening Nigeria’s industrial base.
Executive Secretary of the National Sugar Development Council (NSDC), Kamar Bakrin, said the problem is not a lack of demand for Nigerian-made products but the high cost of producing them. He argued that consumers across Africa are willing to buy Nigerian goods, but manufacturers struggle to remain competitive because of expensive and unreliable infrastructure.
The warning comes amid persistent concerns over Nigeria’s electricity supply. Despite improvements in grid performance in some areas, many manufacturers continue to rely heavily on diesel generators and alternative power sources due to inconsistent public electricity. Industry groups have repeatedly argued that rising electricity tariffs and energy costs are placing additional pressure on factories already dealing with inflation, foreign exchange volatility and high borrowing costs.
Manufacturers say the situation has forced some companies to scale back production, delay expansion plans or pass higher costs on to consumers through increased prices. They are calling for urgent reforms, including more reliable electricity, lower financing costs and improved transport infrastructure to restore Nigeria’s competitiveness.
Business leaders also warn that unless production costs are reduced, locally manufactured goods will continue to struggle against cheaper imports from Asian economies where factories benefit from more affordable power, efficient logistics and lower operating expenses.
The association believes addressing the country’s energy challenges will be critical to boosting industrial output, creating jobs and strengthening Nigeria’s position as one of Africa’s leading manufacturing hubs.
