Nigeria’s manufacturing sector posted a modest real growth rate of 1.25 per cent in the third quarter of 2025, signalling a fragile recovery despite easing inflation, according to new figures released by the National Bureau of Statistics (NBS).
The performance marks an improvement from the 0.8 per cent growth recorded in the same period of 2024 but falls short of the 1.6 per cent achieved in the second quarter of 2025. The figures suggest ongoing strain within the sector, even as broader economic indicators begin to stabilise.
The NBS data also showed a decline in the sector’s contribution to GDP, which fell to 7.62 per cent in the third quarter. This compares with 7.82 per cent a year earlier and 7.81 per cent in the preceding quarter, highlighting subdued productivity and persistent hurdles to expansion.
Despite headline inflation easing to 16.05 per cent in October—its lowest level in over three years—analysts say the relief has yet to spur a stronger manufacturing resurgence. Lower food prices have supported household purchasing power, but cost pressures remain acute for producers.
In a policy brief reviewing the GDP numbers, Director of the Centre for the Promotion of Private Enterprise, Muda Yusuf, described the manufacturing sector as “still fragile and under pressure.” He cited high energy and logistics costs, elevated borrowing rates, reliance on imported inputs, and the smuggling of competing goods as major constraints.
Yusuf warned that without sustained efforts to address bottlenecks affecting manufacturing, agriculture, and trade, Nigeria risks failing to translate macroeconomic stability into meaningful economic gains.
Similarly, former chairman of the Manufacturers Association of Nigeria (MAN), Apapa branch, Frank Ike Onyebu, said the sector has yet to make the kind of impact expected of its potential. He argued that Nigeria could grow manufacturing output by up to 10 per cent annually with the right policy choices, insisting the sector remains far from maturity.
MAN Director General, Segun Ajayi-Kadir, also renewed calls for a reduction in the monetary policy rate to ease financing constraints for producers. He said prevailing borrowing costs—between 30 and 37 per cent—are “high, restrictive, and damaging to competitiveness,” adding that cheaper credit is essential to drive expansion and investment.
Meanwhile, the manufacturing sector’s purchasing managers’ index (PMI) stood at 53.6 points in November, indicating continued improvement in business conditions despite a slight drop from October’s 54 points. The reading marks the 13th consecutive month of expansion.
According to the Stanbic PMI report, manufacturing and services were the key drivers of output growth in November, buoyed by easing inflationary pressures, successful product rollouts, and stronger customer demand.
The report noted that input costs rose at their slowest pace in nearly five years, with softer increases in purchase and labour prices helping firms better manage expenses.
