Yemi Kale, partner and chief economist of KPMG in Nigeria has said that Nigeria’s manufacturing sector lacks depth and is therefore unable to contribute more to the country’s economic growth.
Kale noted this in a recent presentation at the 2023 Nigerian Economic Summit Group (NESG) conference in Abuja.
“The manufacturing sector lacks depth as most of its growth is driven by few sectors. In 2022, only three sub-sectors accounted for about 76 percent of manufacturing GDP,” Kale said.
Kale noted that Nigeria’s manufacturing sector has been weak and sluggish since its recovery from the COVID-19 pandemic, with an average annual growth of 3.4 percent in 2021 and 2.4 percent in 2022.
He said, “The contribution of the manufacturing sector to Nigeria’s GDP still falls short of globally competitive levels, averaging 10 percent annually in its condition to GDP in almost 2 decades.”
It was noted that the manufacturing sector underperforms in its contribution to exports, accounting for only 6.4 percent of total exports recorded in 2021, compared to other countries where manufacturing accounts for over 70 percent of exports.
Kale said that to successfully unlock the full potential of the manufacturing sector to drive prosperity in Nigeria, there is a need to emphasize the deployment of technology and research and development in all manufacturing processes.
“The road map for industrial growth includes; infrastructural development, access to finance and investment, skill development, collaboration and partnerships, ease of doing business, access to market, policy reforms and technological adoption and research and development.
“To successfully unlock the full potentials of the manufacturing sector to drive prosperity in Nigeria, there is the need to emphasize the deployment of technology and R&D in all manufacturing processes,” Kale said.