MAN Reports Inflation Drop Doesn't Lower Production Costs

The Manufacturers Association of Nigeria (MAN) has reported that the recent moderation in Nigeria's headline inflation rate, which fell to 15.39 percent in August 2026 from 15.43 percent in July, has not resulted in lower production costs for manufacturers. Segun Ajayi-Kadir, the director-general of MAN, described the slight decline as a positive development for business planning and consumer welfare but emphasized that it does not equate to reduced production costs.

Manufacturers are still grappling with high energy costs, logistics challenges, exchange rate fluctuations, elevated raw material prices, and various fiscal and regulatory charges. Ajayi-Kadir pointed out that manufacturers cannot fully pass on increased production costs to consumers due to weak purchasing power, which keeps profit margins under pressure.

He warned that high operational costs could lead to reduced production capacity and hinder employment growth. Ajayi-Kadir urged the federal government to take advantage of the current inflation moderation to implement measures aimed at reducing costs and enhancing productivity for manufacturers.