Manufacturing sector records poor business performance in January 2025—NESG  

A Nigeria Business Confidence Monitor report by the Nigeria Economic Summit Group and Stanbic IBTC has said that manufacturing sector in Nigeria scored a negative of -0.66 on the Business Confidence Monitor (BCM) Index for the month of January 2025. The report said that Nigeria’s business environment began the new year on a positive note, amidst a weak recovery. The NESG-Stanbic IBTC Business Confidence Monitor’s (BCM) Current Business Index rose to +5.69 from +0.77 in December 2024. This is said to reflect “an uptick in commercial activity typical of this period.”
According to the report Nigeria’s manufacturing sector recorded a poor business performance in January 2025, which reflects a mildly negative performance but an improved recovery from its December 2024 score which was -2.43. The manufacturing sector had a negative performance alongside the non-manufacturing sector (-4.64), the Services sector (-1.40), and Trade (-0.84).
“However, these sectors showed relative improvement compared to December 2024.” But agriculture recorded a positive performance with a BCM index of +10.86. The report further said that four of the manufacturing sub-sectors assessed recorded mildly negative outcomes, while the others underperformed. The sub-sectors that underperformed are; textile, apparel, and footwear; chemical and pharmaceutical products; plastic and Rubber products and motor vehicles and assembly. It was said that the Motor Vehicles and Assembly sub-sector “experienced a significant downturn.”
The report also said that the underperforming sub-sectors “struggled with high production costs, weak demand, and supply chain disruptions.”  The subsectors with mildly negative performances according to the report are; food, beverages, and tobacco; plastic and rubber products; non-metallic products and basic metal, iron, and steel. These subsectors reportedly recorded “weak positive performances, supported by stable domestic demand and seasonal business activities.”
The report shows mixed trends in the manufacturing sector’s key sub-indices. It said that the Business situation index of the manufacturing sector declined to +21.55 in January, from +24.44 in December, while the sector’s investment index dropped from +20.79 in December 2024 to -5.77 in January 2025. In contrast however, the production index rose significantly to +46.56 from +10.96 in December. Operating Cash Flow Index improved to +21.13 in January from +17.49. This is said to reflect higher output and better liquidity.
The report added that the Cost of Doing Business Index at +41.57 and the Price Index at -40.82, indicate “inflationary pressures and high interest rates.” Additional constraints included limited credit access (-5.62), weak exports (-3.55), and declining operating profits (-17.41). Despite signs of recovery, inflation, high financing costs, and supply chain disruptions remain key risks. To sustain business growth, manufacturers need policy support, improved credit access, and a stable exchange rate. Without strategic interventions, the sector’s recovery may remain sluggish,” the report states further.