Nigeria lost $29.4bn manufacturing opportunity to imports in 2025, SEID report says

Nigeria’s manufacturing sector lost an estimated $29.4 billion opportunity to imports in 2025 as local producers struggled to meet a large share of domestic demand, a new report by SEID has said.

The Nigerian Manufacturing Opportunity Report 2026 was launched at the 54th Annual General Meeting of the Manufacturers Association of Nigeria (MAN). Imported products accounted for 64 per cent of the market for manufactured goods, the report said.

Weak value chains drive import reliance

The report examined five major subsectors: Light Manufacturing and Packaging; Food and Agro-processing; Textiles, Apparel and Leather; Chemicals and Pharmaceuticals; and Cement and Steel. It attributed the trend largely to weak local value chains, which have left manufacturers dependent on imported machinery, components, raw materials and other industrial inputs.

Manufactured goods represented about 53 per cent of Nigeria’s total import bill, despite efforts to expand domestic production.

Growth narrow, GDP share falls

Manufacturing output grew by 1.4 per cent in 2025, before improving to 3.3 per cent in the first half of 2026, compared with 1.6 per cent in the corresponding period of 2025. However, the growth was largely concentrated in cement and food processing, which accounted for almost 90 per cent of the 3.3 per cent expansion recorded during the period.

The concentration raised concerns about the breadth of the country’s industrial recovery. Manufacturing’s contribution to Gross Domestic Product declined from 8.42 per cent in 2023 to 8.05 per cent in 2025. This remained about seven percentage points below the 15 per cent target under the Nigeria Industrial Policy for 2030.

Subsector gaps persist

In light manufacturing and packaging, the report estimated the market at $15.9 billion but said domestic manufacturers supplied only 20 per cent of demand. Local producers continued to rely on imported resins, tooling, components and equipment, even when final assembly was carried out locally.

Chemicals and pharmaceuticals were identified as the most import-dependent subsector, with imports valued at $4.25 billion amid strong domestic demand. The textile, apparel and leather industry also recorded a widening gap between local production and imports. Domestic production grew by 5.8 per cent between 2024 and 2025, while imports rose by 53.8 per cent, increasing import penetration from 10.5 per cent to 14.6 per cent.

Food and agro-processing was identified as one of the areas with significant potential, with a market estimated at $10.93 billion and the country’s strongest manufacturing export base. The sector continues to face difficulties in securing adequate agricultural inputs due to fragmented value chains and post-harvest losses estimated at between N3.5 trillion and N5 trillion annually.

Akeju: Nigeria has demand, strengths

Managing Partner of SEID, Tubosun Akeju, said Nigeria already possessed the demand and industrial strengths required to develop a stronger manufacturing base. Akeju said the priority should be to identify existing areas of strength, deepen local production and improve competitiveness.

He said the report was designed to provide policymakers and industry players with information on immediate manufacturing opportunities, areas where the country was making progress and measures required to increase local value addition.

The report identified stronger domestic value chains as critical to reducing Nigeria’s dependence on imported inputs. It said developing local supply chains would allow manufacturers to source more materials domestically, create jobs, reduce import dependence and improve the competitiveness of Nigerian products in domestic and international markets.

For the naira and Nigerian businesses, the report points to limited progress in import substitution across key manufacturing lines. Until local input supply deepens, manufacturers will keep converting naira into foreign exchange for resins, tooling, components, pharmaceuticals and other inputs. That keeps pressure on the currency and limits the job and value addition gains from domestic demand.