By Yinka Kolawole
Over the past three years, President Bola Tinubu’s administration has rolled out an ambitious package of economic and industrial reforms designed to reposition Nigeria’s manufacturing sector, attract investment, deepen local value addition and stimulate production-led growth.
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From intervention funds and industrial roadmaps to fiscal reforms, local content policies and foreign exchange restructuring, the administration has introduced several initiatives aimed at strengthening the country’s industrial base.
However, while manufacturers acknowledge the intent and potential of many of these policies, they argue that tangible improvements in industrial performance have yet to materialise.
The Manufacturers Association of Nigeria (MAN) says the challenge is no longer the absence of policy frameworks but the inability of those policies to translate into lower production costs, improved competitiveness and measurable industrial growth.
Director General of MAN, Segun Ajayi-Kadir, described the past three years as a period of difficult but consequential economic transition, noting that the administration had demonstrated courage in addressing long-standing structural distortions within the economy.
According to him, however, the burden of the reforms has fallen heavily on manufacturers.
N200bn Intervention Fund
Among the administration’s flagship interventions is the N200 billion Presidential Intervention Fund introduced to support manufacturers and Micro, Small and Medium Enterprises (MSMEs).
The fund was structured into three components comprising a N75 billion Manufacturing Sector Fund, N75 billion MSME Loan Scheme and N50 billion Nano Business Support Scheme.
The initiative was conceived as a stimulus package to ease access to affordable financing and support productive enterprises struggling under rising operating costs.
While manufacturers welcomed the intervention, MAN maintains that the broader industrial environment remains challenging, with many firms still grappling with high energy costs, exchange rate pressures and expensive credit, limiting the overall impact of intervention financing.
Nigeria Industrial Policy 2025
The administration also unveiled the Nigeria Industrial Policy (NIP) 2025, a comprehensive 10-year framework intended to transform the country’s industrial landscape.
The policy targets raising manufacturing’s contribution to Gross Domestic Product (GDP) to between 20 and 25 per cent by 2030, while proposing the recapitalisation of the Bank of Industry (BoI) to N3 trillion to expand industrial financing.
MAN views the policy as one of the most significant industrial initiatives introduced by the administration.
According to Ajayi-Kadir, the roadmap provides a strategic framework capable of driving industrial transformation, improving access to finance and strengthening development finance institutions.
However, he insists that the policy’s success will depend entirely on implementation and the government’s ability to create a supportive operating environment for manufacturers.
‘Nigeria First’ Policy
Another major initiative is the ‘Nigeria First’ policy, which directs Ministries, Departments and Agencies (MDAs) to prioritise locally manufactured goods and services in public procurement.
The policy seeks to stimulate domestic production, reduce dependence on imports and create market opportunities for indigenous industries.
MAN has strongly welcomed the initiative, describing it as potentially transformative for local manufacturers.
According to the association, effective implementation across all government institutions could significantly expand demand for Nigerian-made products, encourage new investments and deepen domestic value chains.
“The renewed emphasis on local content procurement through the Nigeria First framework represents an important step toward strengthening domestic industrial capacity,” MAN DG said.
Nevertheless, he cautioned that the policy must be consistently enforced to avoid becoming another well-intentioned initiative with limited practical impact.
Foreign Exchange Reforms
One of the most consequential economic reforms undertaken by the administration was the unification of foreign exchange (FX) windows and the liberalisation of the exchange rate regime.
The reforms were designed to improve transparency, eliminate market distortions and attract foreign investment.
While acknowledging these objectives, MAN said the immediate impact on manufacturers has been severe, noting that the sharp depreciation of the naira significantly increased the cost of imported machinery, raw materials and industrial inputs.
According to MAN, many manufacturers were forced to absorb substantial cost increases, resulting in higher product prices, reduced profit margins and delayed expansion plans.
30% Local Value Addition
The proposed legislation requiring a minimum of 30 per cent local value addition before selected agricultural commodities and solid minerals can be exported has received strong support from manufacturers.
The bill, which has already been passed by both chambers of the National Assembly and awaits presidential assent, seeks to encourage domestic processing rather than the export of raw materials.
MAN believes the policy could become a major catalyst for industrialisation by stimulating local processing industries, increasing value retention within the economy and creating jobs across manufacturing value chains.
The association argues that the measure aligns with global industrialisation strategies that prioritise value addition before export.
2025 Tax Reform Act
Among the administration’s most celebrated reforms from the perspective of manufacturers is the 2025 Tax Reform Act.
The legislation introduces far-reaching fiscal changes aimed at improving competitiveness and reducing the burden of taxation on businesses.
MAN has particularly welcomed provisions such as withholding tax exemptions, expanded Value Added Tax deductibility on fixed assets and services, phased reductions in Companies Income Tax, research and development incentives and targeted support for small businesses.
The association believes these measures could significantly improve the business environment and encourage industrial investment.
MAN also expressed optimism about efforts to harmonise taxes and levies across states, noting that multiple taxation remains one of the most persistent challenges facing manufacturers.
Naira-for-Crude Initiative
The administration’s Naira-for-Crude initiative was introduced to enable domestic refineries purchase crude oil in naira rather than in US dollars.
The policy was designed to reduce pressure on FX demand, strengthen the local currency and improve domestic energy security.
MAN considers the initiative one of the more impactful reforms introduced so far.
According to Ajayi-Kadir, the policy has helped ease pressure on FX demand within downstream petrochemical and plastics value chains, offering some relief to manufacturers dependent on locally refined products.
National Single Window
In a bid to improve trade facilitation and reduce bottlenecks at ports, the government launched the National Single Window (NSW), a digital platform designed to integrate government agencies and private stakeholders involved in import and export processes.
The initiative aims to significantly reduce cargo clearance times, improve transparency and lower transaction costs.
MAN has welcomed the platform, noting that efficient trade logistics remain critical to industrial competitiveness.
According to the association, successful implementation of the Single Window system could reduce delays at ports, improve supply chain efficiency and lower operating costs for manufacturers.
Challenges Persist
Despite acknowledging the potential benefits of many of the government’s industrial initiatives, MAN insists that manufacturers continue to face significant challenges arising from broader macroeconomic reforms.
Ajayi-Kadir noted that the removal of fuel subsidies, exchange rate liberalisation, electricity tariff increases and tight monetary policies have dramatically altered the operating environment.
Manufacturers have experienced soaring energy costs, higher logistics expenses, and elevated borrowing costs.
The association also expressed concern about the state of electricity supply.
According to MAN, despite substantial tariff increases over the past three years, power supply remains unstable due to recurring grid failures and system disruptions.
As a result, many manufacturers continue to rely heavily on diesel, gas and petrol-powered alternatives, significantly increasing production costs and reducing competitiveness.
In response to inflationary pressures, monetary authorities raised the Monetary Policy Rate (MPR) several times and tightened access to credit.
While acknowledging the need for macroeconomic stability, MAN argues that borrowing costs have become prohibitively expensive for manufacturers seeking to invest and expand.
From Policies to Industrial Outcomes
For manufacturers, the central question is no longer whether the government has introduced enough policies but whether those policies can deliver measurable industrial results.
“The reforms have laid the groundwork for long-term economic restructuring, but macroeconomic stabilisation must now transition into industrial recovery and growth,” Ajayi-Kadir stated.
According to him, Nigeria’s manufacturing sector requires a more coordinated policy environment that deliberately lowers the cost of production, supports investment and enhances competitiveness.
As the Tinubu administration enters its fourth year, manufacturers say the true test of its reform agenda will be reflected not in the number of initiatives announced, but in the revival of factory activity, expansion of local value chains, job creation and sustained growth in industrial output.
For now, MAN’s verdict is that while several policies show promise and could transform the industrial landscape if effectively implemented, manufacturers are yet to see those initiatives translate into the broad-based industrial growth needed to reposition the sector as a major driver of Nigeria’s economic development.
