Muda Yusuf, Director and Chief Executive Officer, Center for the Promotion of Private Enterprise (CPPE)
…CPPE says risks must be addressed to enhance competitiveness
The Center for the Promotion of Private Enterprise (CPPE) has said Nigeria's structural risks are threatening manufacturing growth in 2026 as companies begin to take advantage of reforms.
CPPE Chief Executive Officer Muda Yusuf stressed that without addressing these structural risks, the country's manufacturing will remain uncompetitive in 2026 despite current macroeconomic stability.
Yusuf, who said this in a note titled ‘Nigeria’s Manufacturing Sector: Outlook, Risks and Policy Priorities (2026)’, pointed out that these constraints cannot be resolved within one financial year, noting that expectations for the sector in 2026 must be carefully managed.
“If reforms in power, trade and development finance are effectively implemented, the region's growth prospects and competitiveness will significantly increase through 2026 and beyond,” he said.
He listed major structural changes coming to the country's manufacturing sector, including inadequate and costly infrastructure, especially power and logistics; port inefficiencies and supply chain disruptions; Driven by high energy costs, dependence on captive power and unfavorable regulatory and business environment.
Others are unfair competition from cheap imports, especially from Asia, high costs of funding, absence of long-term financing, and weak consumer purchasing power.
Also read: Manufacturers see stable manufacturing outlook for 2026 amid policy haze
Yusuf said the challenges facing Nigeria's manufacturing sector have remained largely unchanged over the years, adding, “They are primarily structural, not cyclical, and therefore require medium to long-term solutions rather than quick fixes.”
He stressed that these constraints continue to undermine competitiveness, investment returns and industrial growth.
“These issues have kept manufacturing costs high and weakened competitiveness relative to imported goods,” he said, adding, “Without addressing these risks, Nigeria's manufacturing sector will remain structurally uncompetitive.”
According to him, improving macroeconomic fundamentals are expected to support better manufacturing outcomes in 2026, especially for firms that are backward integrated and better aligned with domestic input sourcing.
“Under the current recovery conditions, these sectors are likely to record strong returns on investment,” he said.
He also said that it is a matter of relief that although these structural constraints persist, the macroeconomic environment has improved significantly over the past year.
He explained that greater foreign exchange market stability, along with prospects for gradual appreciation and declining inflation, could ultimately translate into lower interest rates.
He advised the government to “maintain FX market stability and the pace of reform, avoid disruptive policy reversals, strengthen gas supply, production, transmission and distribution.
He said the government should empower development finance institutions to provide low-cost funds, with long durations suitable for manufacturing, which is needed to address the market failures evident in commercial finance.
“Protect domestic manufacturers without harming consumer welfare. Encourage competition among manufacturers, not between manufacturers and importers.”
Yusuf said policy priorities for 2026 should include macroeconomic stability, fixing the power sector value chain, improving access to long-term funding, deployment of smart trade and security policies and deepening ‘Nigeria First’ policy implementation.
He also urged the federal government to go beyond rhetoric to implement the Nigeria First policy by using “public procurement at the federal and state levels to give priority to made-in-Nigeria goods”.
