Nigerian manufacturing sector faces 22.5% decline in commercial bank credit in 2025

Mr. Segun Ajayi-Kadir, Director-General of MAN, stated that this decline, which represents a N1.92 trillion reduction, is alarming and could impede industrial growth, job creation, and economic diversification. He noted that manufacturing experienced one of the steepest credit contractions among major sectors, trailing behind the oil and gas sector N10.59 trillion and the finance sector N9.24 trillion in credit attraction. Ajayi-Kadir attributed the credit allocation decline to high interest rates, bureaucratic hurdles, and inconsistent policies, also criticizing the non-implementation of the N1 trillion Manufacturing Stabilisation Fund from the Federal Government’s Accelerated Stabilisation and Advancement Plan ASAP in 2024.

He warned that inadequate access to affordable financing could undermine the 2025 Nigeria Industrial Policy NIP and lead to reduced manufacturing capacity utilization, stagnation of the sector’s GDP contribution, job losses, supply-side inflation, and foreign exchange pressures. To address these issues, Ajayi-Kadir proposed reducing benchmark interest rates by 200 to 300 basis points, incentivizing banks to lend to manufacturing at single-digit rates, increasing the capital base of the Bank of I