Nigerian manufacturers have raised the alarm over escalating production costs, revealing that businesses spent an estimated ₦1.35 trillion on alternative electricity sources in 2025, while 18,935 manufacturing jobs were lost in the first half of the year.
The warning was issued by the Chemical and Non-Metallic Products Employers Federation (CANMPEF), which called on the Federal Government to urgently address rising energy costs, expensive borrowing, multiple taxes and weak consumer demand.
Speaking at the federation’s 46th Annual General Meeting in Lagos, its president and Dangote Group Vice President, Devakumar Edwin, said improvements in Nigeria’s broader economic indicators had yet to translate into meaningful relief for manufacturers.
According to Edwin, the country’s economy grew by 3.87 per cent in 2025, compared with 3.38 per cent in 2024. However, manufacturing recorded growth of just 1.41 per cent, while its contribution to real Gross Domestic Product fell from 8.24 per cent to 8.05 per cent.
He identified unreliable electricity supply as one of the sector’s most pressing challenges, explaining that manufacturers were increasingly forced to rely on generators and other alternative energy sources to keep their operations running.
Despite an installed electricity generation capacity exceeding 13,000 megawatts, average delivered power remained below 5,000MW, against estimated demand of about 18,345MW, according to figures presented by the federation.
Citing data from the Manufacturers Association of Nigeria, Edwin said manufacturers spent ₦1.35 trillion on alternative power in 2025, representing a 23 per cent increase from the previous year.
The federation also highlighted the employment impact of the difficult operating environment. Figures attributed to MAN showed that 18,935 manufacturing jobs were lost in the first half of 2025, compared with 10,891 during the corresponding period in 2024.
Although capacity utilization improved to 61.3 per cent in the first half of 2025 from 57.6 per cent in the second half of 2024, the federation said the job losses demonstrated that the sector’s recovery remained fragile.
Edwin urged the Federal Government to prioritize gas supply to industries, address outstanding debts in the electricity sector, establish a predictable tariff framework and encourage investment in captive, embedded and renewable power solutions for industrial clusters.
He also called for more affordable long-term financing, a streamlined tax system, improved infrastructure and stronger action against counterfeit and substandard products competing with locally manufactured goods.
The federation acknowledged government relief measures covering import duties and value-added tax on 875 pharmaceutical raw materials but urged authorities to consider similar targeted support for other essential industrial inputs.
CANMPEF warned that the outlook for manufacturers in 2026 would depend largely on whether economic stabilization translated into lower operating costs, stronger production, sustainable employment and improved competitiveness.
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