Output in the manufacturing sector hit N4.67 trillion in the first six months of 2017 (H1 2017) from N3.76 trillion recorded in the corresponding half of 2016.
This represents a 24.2 percent increase over the period, according to surveys conducted by the Manufacturers Association of Nigeria (MAN).
However, this is a 7 percent decline, compared with N5.02 trillion recorded in the last six months of 2017.
On a sectoral basis, the food, beverage and tobacco group increased output to N1.68 trillion in the period under review from N1.31 trillion reported in the corresponding period of 2016, indicating a N0.37 trillion increase over the period.
The chemicals and pharmaceuticals group raised output to N352.25 billion in the review period, from N259.27 billion recorded in the corresponding period of 2016, showing a 35.9 percent increase over the period.
Vehicle assemblers upped their output to N1.84 trillion in the period under review from N1.57 trillion recorded in the corresponding half of 2016. This shows a 17.2 percent increase over the period.
Analysis across industrial zones shows that output in the Ikeja area increased to N2.79 trillion within the period from N1.76 trillion recorded in the corresponding half of 2016, indicating a 58.5 percent increase over the period.
This makes Ikeja the best performing zone in terms of output within the period.
Similarly, output in the Ogun area rose to N1.48 trillion in the review period, from N1.32 trillion recorded in the corresponding period of 2016, showing a 12.1 percent increase over the period.
Output in Apapa industrial zone also increased to N304.65 billion in the period from N196.44 billion recorded in the corresponding half of 2016. This represents a whopping 55.1 percent increase over the period.
Apapa’s output increased by N52.09 billion or 20.6 percent when compared with N252.56 billion recorded in the preceding half.
The output in H1 of 2017 was higher than that of the corresponding period of 2016 owing to dollar availability in the last two months of the first half of 2017.
In H1 of 2017, manufacturers faced dollar scarcity, which made importation of raw materials and machines difficult. However, light began to shine in April when the Central Bank of Nigeria introduced the Investors and Exporters (I&E) window, which eventually eased the dollar crunch in the economy.
“As the second half of 2017 went underway, activities in the country gained momentum, leading to the eventual extrication of the economy from recession in the second quarter of the year,” MAN says.
“It is believed that various credible policies implemented since 2016, such as the Economic Recovery and growth Plan (ERGP), the CBN Forex intervention and many more, were responsible for the economic improvements in the first Half of 2017.”
MAN further states that CBN’s forex policy successfully narrowed exchange rate premium in the market and made the greenback more available in the economy.
“Also, the first half of 2017 witnessed relative monetary and fiscal policy union that led to the review of the 41 items of industrial raw-materials excluded from the official forex market and the lifting of ban on Export Expansion Grant (EEG) by the Government,” MAN adds.