US-Iran Conflict: MAN Outlines Urgent Steps to Shield Nigerian Manufacturers

US-Iran Conflict: MAN Outlines Urgent Steps to Shield Nigerian Manufacturers

The Manufacturers Association of Nigeria (MAN) has raised alarm over the escalating US-Iran conflict impact on Nigerian manufacturers, warning that the geopolitical tensions in the Middle East pose immediate, severe, and multi-layered risks to Nigeria’s industrial sector.

Director-General of MAN, Segun Ajayi-Kadir, said the sector is already feeling the effects of a global energy shock, noting that the industry’s projected 3.1% growth target for 2026 is now under serious threat.

He explained that manufacturers’ dependence on diesel and gas for production has left them highly vulnerable to rising global crude oil prices, which have pushed up domestic energy costs and significantly eroded profit margins.

“Energy cost escalation is biting hard. Many manufacturers are seeing their margins wiped out almost overnight,” Ajayi-Kadir said, highlighting the growing strain on operators.

The energy crisis in Nigeria’s manufacturing sector has been compounded by imported inflation, rising freight charges, and prolonged shipping delays. According to MAN, higher logistics and transportation costs are making the importation of critical raw materials increasingly expensive, thereby disrupting production cycles.

Ajayi-Kadir warned that the situation has created a double burden of rising production costs and weakening consumer demand, leaving many manufacturers with unsold inventories and shrinking revenues.

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“The implication is clear – production costs are rising sharply, while consumer purchasing power is weakening. Manufacturers are now battling both high costs and unsold inventories,” he said.

Beyond energy and logistics challenges, MAN noted that exchange rate volatility and limited access to foreign exchange have further complicated operations, making it difficult for manufacturers to source essential inputs.

To mitigate the crisis, MAN outlined several key measures to stabilise Nigeria’s manufacturing sector, urging the Federal Government to act swiftly.

The association called for the fast-tracking of the Presidential Compressed Natural Gas (CNG) initiative, which it believes will help industrial clusters reduce reliance on diesel and lower energy costs.

It also recommended the creation of a dedicated foreign exchange window by the Central Bank of Nigeria to ensure manufacturers have timely access to forex for importing raw materials and machinery.

In addition, MAN advocated for the domestication of petroleum supply chains, urging local refineries to prioritise supply to domestic manufacturers at competitive rates to cushion the impact of global oil price volatility.

To ease logistics pressures, the group proposed a six-month suspension of multiple taxation, haulage levies, and highway tolls, noting that transport-related costs have surged significantly.

“The current crisis is a stark reminder of Nigeria’s vulnerability to external shocks due to our dependence on imported inputs,” Ajayi-Kadir said, stressing the need for structural reforms.

He added that the situation presents an opportunity for Nigeria to pursue manufacturing self-sufficiency, reduce import dependence, and build a more resilient industrial base.

Industry analysts also warn that sectors such as chemicals, pharmaceuticals, food processing, and steel are particularly exposed due to their reliance on imported inputs and sensitivity to global price fluctuations.

MAN cautioned that failure to implement urgent interventions could lead to factory shutdowns, job losses, reduced industrial output, and a major setback to Nigeria’s industrialisation drive.

“We cannot control global geopolitics, but we can control our domestic response,” Ajayi-Kadir reiterated, urging policymakers to treat the situation as both a crisis and an opportunity to reposition Nigeria’s manufacturing sector for long-term sustainability.

US-Iran Conflict: MAN Outlines Urgent Steps to Shield Nigerian Manufacturers