Business

MAN Calls For Urgent Interest Rate Cut to Protect Nigeria’s Industrial Base

Published

7 months ago

May 21, 2025

216 Views

The Manufacturers Association of Nigeria (MAN), has called for an urgent interest rate cut to protect Nigeria’s Industrial Base.

In a press release signed by Segun Ajayi-Kadi, Director General Manufacturers Association of Nigeria, MAN said it is deeply concerned and worried about the continued decision of the Central Bank of Nigeria (CBN) to maintain the Monetary Policy Rate (MPR) at 27.5 percent since November 2024, despite a global wave of interest rate reductions.

The statement reads:

The Manufacturers Association of Nigeria (MAN) is deeply concerned and worried about the continued decision of the Central Bank of Nigeria (CBN) to maintain the Monetary Policy Rate (MPR) at 27.5 percent since November 2024, despite a global wave of interest rate reductions aimed at revitalizing economic productivity and combating stagflation.

We are perturbed that when most progressive economies are charting a course toward industrial recovery and macroeconomic stability, Nigeria’s monetary stance tends to lead us in a different direction.

Over the last quarter, countries such as members of the Euro Area, the United Kingdom, Denmark, Australia, China, India, Thailand and Egypt, have implemented interest rate cuts to bolster economic growth and support productive sectors.

Yet, our rigidity continues to create unintended consequences that may deepen the parlous performance of the productive sector.

A nation cannot industrialize on the back of prohibitively expensive credit. With the benchmark interest rate held at 27.5 percent, Nigeria has become the 6th most expensive country to source credit as local manufacturers grapple with an average lending rate of over 37 percent.

This policy posture is not only inflationary, but is suffocating the capacity of the manufacturing sector.

Compounded by other limiting factors, our members—small, medium and even large-scale—are finding it increasingly difficult to stay afloat, expand production lines, or even meet basic operational costs.

When credit is priced highly, production declines and the nation “imports poverty”.

Our concerns go beyond the debilitating impact on our numbers business. The “Nigeria First Policy”, which seeks to strengthen local industry and reduce import dependence, may be under severe threat.

At the heart of its successful implementation lies access to affordable financing to boost capacity utilization.

Unfortunately, the current interest rate regime constrains finance costs for our members, surging by over 44 percent from ₦1.43 trillion in 2023 to ₦2.06 trillion in 2024 and rising. This represents a sharp increase that has directly depressed productivity and led to underutilization of industrial capacity.

The high cost of credit has not only diminished the flow of investments into the manufacturing sector but has also dulled the return on existing investments, with Small and Medium Industries hit the hardest.

Confidence in the industrial outlook has waned, as evident in the dip in the Manufacturers CEO’s Confidence Index from 50.7 points to 48.3 points.

This mirrors the growing anxiety of our manufacturers. A nation that woos foreign portfolio investors at the expense of its real sector may unwittingly be aspiring to build prosperity on the back of volatility.

We are disturbed by the implicit prioritization of short-term foreign capital inflows over the long-term health of domestic industries.

While maintaining a high interest rate of 27.5 percent may temporarily attract speculative foreign portfolio investors, it is doing so at the expense of Nigeria’s manufacturing base, which is now choked by unsustainable borrowing costs.

What is evident now is the widening profitability of the banking sector, buoyed by elevated interest margins, while manufacturers contend with shrinking margins, rising debts and declining productivity.

This is an economic paradox that must be urgently addressed. The current monetary policy trajectory risks turning banks into vaults of idle wealth, while the real economy—where jobs are created and value is added—faces suffocation. A society that rewards intermediaries over producers invites long-term decline.

Access to affordable credit is the oxygen that sustains industrial growth and no economy has ever grown by starving its manufacturers of oxygen. The Manufacturers Association of Nigeria is ever committed to collaborating with the Government and all stakeholders to achieve macroeconomic stability.

We therefore earnestly beseech the CBN to urgently reconsider its monetary stance. Moreover, recent disinflationary trends provide justification for the CBN to cut rates. Real interest rates have improved, already giving financial investors higher inflation-adjusted returns.

Therefore, maintaining a high nominal interest rate under current inflation conditions is neither necessary nor justifiable, and will only prolong the pain for manufacturers and consumers alike.In light of the above, MAN calls on the CBN to:

➢ Cut the benchmark interest rate significantly to reflect current realities and ease the credit burden on manufacturers.

➢ Deploy moral suasion and policy incentives for commercial banks to facilitate single-digit, concessionary interest rates to the manufacturing sector.

➢ Facilitate the approval of the ₦1 trillion earmarked for manufacturers under the Stabilization Plan to support industries struggling under current financial pressures.

➢ Facilitate significant increase in the capital base of the Bank of Industry (BOI) to scale up its capacity to meet the sector’s growing credit demands.

➢ Settle the outstanding $2.4 billion Forex Forward Contracts to restore manufacturers’ confidence and end the unprecedented decapitation of the financial viability of the affected industries. This will also improve access to non-locally available raw materials.

➢ Facilitate a policy direction to peg the customs duty exchange rate for importing industrial inputs, especially raw materials and machinery, to prevent further inflationary pass-through effect.

Industrial confidence is a fragile currency and once broken, it takes time to rebuild. Nigeria cannot afford to lose its manufacturing momentum at a time when the world is repositioning for the next wave of industrial transformation.

The commendable reform measures of this administration may not be helped by the persistent high cost and constrained access to funds. The current monetary policy is not only undermining manufacturers’ confidence but also jeopardizing national economic resilience.

We urge the Central Bank to act decisively and in synergy with the fiscal authority to ensure that Nigeria’s manufacturing sector does not sink deeper into stagnation. The time to act is now.

Related Topics:Featured Interest Rate Cut MAN

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CPPE Tasks Govt to Fix Cost of Living Crisis Amid GDP Growth

Reacting on Nigeria’s third quarter 2025 Gross Domestic Product (GDP) growth of 3.98 percent , CPPE said that it’s laudable, but called for policy interventions to fix the cost of living crisis.

Published

14 hours ago

December 2, 2025

OCHEFA

35 Views

The Center for the Promotion of Private Enterprises (CPPE) tasks the government to ensure that GDP Growth and macroeconomic stability translate into real improvements in citizens’ welfare.

Reacting on Nigeria’s third quarter 2025 Gross Domestic Product (GDP) growth of 3.98 percent , CPPE said that it’s laudable, but called for policy interventions to fix the cost of living crisis.

Dr Muda Yusuf, CEO of the CPPE, notes that despite the improvment in the GDP, the cost-of-living crisis remains a concern .

He said: ” While disinflation is underway and prices of some food items and manufactured products are easing, the social outcomes of economic reforms continue to weigh on households.

” It is therefore imperative for policymaking to prioritise targeted interventions to address the uneasiness around the cost of living and ensure that GDP Growth and macroeconomic stability translate into real improvements in citizens’ welfare—particularly for vulnerable groups.”

To consolidate the gains recorded in Q3 and unlock stronger, more inclusive growth, Dr Yusuf, said that the following policy interventions are critical:

Reduce Structural Bottlenecks

Address energy supply constraints, reduce logistics costs, improve port efficiency, and accelerate transport infrastructure development.

Mitigate the Cost-of-Living Crisis

Implement targeted social interventions and remove structural impediments that elevate consumer prices.

All tiers of government [local, state and federal] must sustain targeted interventions in agriculture, pharmaceuticals, transportation and energy to fix the cost of living crisis.

Business

Dangote Targets Nigeria Festive Season Monthly Supply of 1.5 billion litres of PMS

This represents 50 million litres per day. We are formally notifying the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) of this commitment.

Published

2 days ago

December 1, 2025

OCHEFA

40 Views

Dangote Petroleum Refinery says that it has concluded arrangements to supply over 50 million litres of petrol per day into the Nigerian market this festive season (December to January).

The company said that the decision was taken to ensure that there is no shortage of the product during the festive season.

This translates to 1.5 billion litres of Premium Motor Spirit (PMS) for the month of December.

The same amount of product will also be supplied in January 2026, it was added.

President and Chief Executive of Dangote Industries Limited, Aliko Dangote, announced the plans.

Dangote said: “In line with our commitment to national well-being, and consistent with our track record of ensuring a holiday season free of fuel scarcity, the Dangote Petroleum Refinery will supply 1.5 billion litres of PMS to the Nigerian market this month.

This represents 50 million litres per day. We are formally notifying the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) of this commitment.

We will supply another 1.5 billion litres in January and increase to 1.75 billion litres in February, which translates to over 60 million litres per day.”

Speaking during a visit by the South-South Development Commission (SSDC) to the refinery and the Dangote Fertiliser complex, he stated that the facility currently has adequate stock and is producing between 40 and 45 million litres of PMS daily.

He added that the daily supply of 50 million litres should dispel long-standing claims that domestic refineries lack the capacity to meet national demand.

Business

Dangote Partners Honeywell International to Boost Refinery Capacity to 1.4 million barrels per day

Published

1 week ago

November 25, 2025

Charles Flames

71 Views

Dangote Refinery, Africa’s largest single-train petroleum refinery, has signed a landmark contract with U.S. industrial giant Honeywell International to execute a significant capacity upgrade that will boost the facility’s crude processing capability from the current 650,000 barrels per day to an ambitious 1.4 million barrels per day.

The multi-billion-dollar project, described by sources close to the deal as one of the largest refinery expansion initiatives globally in recent years, will involve the installation of advanced process units, automation systems, and energy-efficiency technologies supplied and integrated by Honeywell UOP and Honeywell Process Solutions.

Aliko Dangote, President and CEO of Dangote Industries Limited, confirmed the partnership, stating: “This strategic collaboration with Honeywell will position the Dangote Refinery as one of the top five largest refineries in the world by capacity.

The upgrade will not only enhance our ability to meet Nigeria’s complete refined products demand but also establish the refinery as a major export hub for gasoline, diesel, jet fuel, and petrochemicals across Africa and beyond.

”The expansion is expected to be implemented in phases, with key units including additional crude distillation, hydrocracking, and catalytic reforming modules.

Honeywell’s proprietary technologies are anticipated to improve yield of high-value products while reducing energy consumption and emissions.Upon completion, the 1.4 million bpd Dangote Refinery will surpass the current global top-tier facilities such as Reliance Industries’ Jamnagar Refinery (1.24 million bpd) and Paraguay’s planned 1.2 million bpd project, cementing its status as the world’s largest single-train refinery.

The project is expected to create thousands of direct and indirect jobs during the construction and commissioning phases and further reduce Nigeria’s dependence on imported refined petroleum products.

A spokesperson for Honeywell confirmed the award, saying the company was “honored to partner with Dangote on this transformative project that will reshape the African downstream landscape.

”Detailed timelines and the exact value of the contract were not disclosed, but industry analysts estimate the expansion could exceed $5–7 billion in total investment.

The statement said: Dangote Group is pleased to announce that it has entered into a strategic partnership with Honeywell International Inc to support the next phase of expansion of the Dangote Petroleum Refinery.

This collaboration will provide advanced technology and services that will enable the refinery to increase its processing capacity to 1.4 million barrels per day by 2028, marking a major milestone in our long-term vision to build the world’s largest petroleum refining complex.

Through this agreement, Honeywell will supply specialised catalysts, equipment, and process technologies that will allow the refinery to process a broader slate of crude grades efficiently and to further enhance product quality and operational reliability.

Honeywell, a global Fortune 100 industrial and technology company, offers a wide portfolio of solutions across aviation, automotive, industrial automation, and advanced materials.

Honeywell’s division UOP has been a technology partner to Dangote since 2017, providing proprietary refining systems, catalyst regeneration equipment, high performance column trays, and heat exchanger technologies that support our best-in-class operations.

Dangote Group is also advancing its petrochemical footprint. As part of the wider collaboration, we are scaling our polypropylene capacity to 2.4 million metric tons annually using Honeywell’s Oleflex technology.

Polypropylene is a key industrial material widely used across packaging, manufacturing, and automotive applications.In addition to refining expansion, Dangote Group is progressing with the next phase of its fertiliser growth plan in Nigeria. We will increase our urea production capacity from 3 million metric tons to 9 million metric tons annually.

The existing plant consists of two trains of 1.5 million metric tons each. The expansion will add four additional trains to meet growing demand for high-quality fertiliser across Africa and global markets.

Dangote Group remains fully committed to delivering world-class industrial capacity, strengthening Nigeria’s energy security, and driving sustainable economic growth through long-term investment, innovation, and strategic global partnerships.