MAN confidence index recovers, high interest rates cloud outlook

Nigerian manufacturers regained confidence in the business environment in the second quarter of 2026, according to the Manufacturers Association of Nigeria (MAN).

The association made this known in the Manufacturers’ CEOs Confidence Index (MCCI) Q2 2026 report released on Thursday.

MAN says executives returned to a positive outlook after the sector’s confidence index fell below the benchmark in the previous quarter.

The Manufacturers’ CEOs Confidence Index for Q2 2026 rose by 3.4 points, indicating renewed confidence among manufacturers doing business in Nigeria.

What MAN is saying

MAN said the improvement was driven largely by expectations around the commercial environment, supported by recent policy measures including the Nigeria Tax Act 2025, Nigeria Industrial Policy and the “Nigeria First” Policy.

• “The aggregate MCCI for Q2 2026 was 52.1. This was 3.4 points higher than that of Q1 2026 which stood at 48.7. Specifically, within the second quarter of 2026, manufacturers reported a return of confidence in doing business in Nigeria,” MAN said.
• “This confidence was more related to the expected commercial environment than to the economy’s hitherto business and employment conditions. The recent tax laws, executive orders and other business-related policies (Nigeria Industrial Policy and “Nigeria First” Policy) cast a more positive outlook on manufacturing executives,” MAN added.

MAN said manufacturers remained optimistic about the third quarter of 2026, with expected business conditions, employment conditions and production levels projected to rise above the 50-point confidence benchmark.

• The expected business condition index for Q3 2026 was 55.6, while employment condition and production level indices stood at 55.2 and 63.0, respectively.
• Despite the positive outlook, manufacturers identified limited access to finance as their biggest challenge during the quarter.
• The association noted that the Monetary Policy Rate (MPR) currently stands at 26.5%, adding that high lending rates have limited the flow of credit to manufacturers.

MAN recommended that the CBN reduce the MPR below 20% to improve access to credit for manufacturers. It also called for priority foreign exchange allocation for manufacturers importing machinery, spare parts and production materials.

The return of confidence was uneven across manufacturing sectors, with some industries recording stronger improvements than others.

The Motor Vehicle and Miscellaneous Assembly sector recorded the highest confidence level at 69.4, rising significantly from 41.3 in Q1 2026. It was followed by Wood and Wood Products at 66.7 and Textile, Apparel and Footwear at 58.3.

Meanwhile, manufacturers in Pulp, Paper, Printing, Publishing and Packaging recorded the lowest confidence level at 38.6, followed by Electrical and Electronics at 42.5 and Chemicals and Pharmaceuticals at 47.7.

More insights

The improved sentiment among manufacturers comes amid renewed government efforts to reposition Nigeria’s industrial base through the Nigeria Industrial Policy 2025, which MAN identified as one of the policy initiatives supporting a more positive business outlook.

• President Bola Ahmed Tinubu formally unveiled the policy in February 2026 as a strategic roadmap aimed at strengthening Nigeria’s industrial ecosystem, promoting value addition, addressing structural bottlenecks and accelerating industrial growth.
• At the unveiling, President Tinubu said the policy was designed to re-engineer Nigeria’s industrial landscape and unlock value across key sectors of the economy. He also stressed the importance of implementation, noting that policies often fail at the execution stage rather than at the point of conception.

However, the policy’s success is expected to depend heavily on resolving long-standing constraints facing manufacturers, particularly electricity supply.

Industrialists, including Aliko Dangote, have continued to call for urgent reforms in the power sector, describing reliable electricity as critical to achieving sustainable industrial growth.

What you should know

MAN has previously pushed back against policy recommendations it believes could undermine local manufacturing.

• In April, the association rejected the World Bank’s recommendation to reinstate petrol import licences, warning that such a move could trigger deindustrialisation and reverse gains made in developing domestic refining capacity.
• The position was disclosed by MAN Director-General, Segun Ajayi-Kadir, following the World Bank’s recommendation that Nigeria sustain the importation of Premium Motor Spirit (PMS) to support fuel supply stability.

The World Bank later removed the report from its website and issued a clarification calling for a reassessment in light of changing global energy dynamics.