The Manufacturers Association of Nigeria (MAN) is urging the Central Bank of Nigeria (CBN) to immediately review its monetary policy stance and slash interest rates, warning that the prevailing tight monetary policy is crippling Nigeria’s real sector, especially manufacturing and agriculture.

The call came in reaction to the CBN’s Monetary Policy Committee (MPC) decision at its 301st meeting held July 21–22, 2025, where it voted unanimously to retain the Monetary Policy Rate (MPR) at a record-high 27.5% for the second consecutive time this year.

While the CBN argues that the rate retention is part of a broader plan to sustain the disinflationary momentum, MAN contends the policy has yielded little benefit for producers. In a statement, the association described the CBN’s contractionary stance as a chokehold on manufacturing and real-sector productivity.

Lending rates to manufacturers now exceed 35%, MAN revealed, noting that many operators are now either closing shop, cutting production, or relocating. The association said the consequences are evident in surging production costs, lower capacity utilization, reduced output, widespread layoffs, and rising prices of finished goods.

In 2024, the average capacity utilization of the manufacturing sector fell to 57%, down from 59% the previous year. Worse still, unsold finished goods more than doubled year-on-year, jumping to N2.14 trillion in 2024 from N1.14 trillion in 2023.

MAN said this drastic surge is driven by declining consumer purchasing power, high interest on working capital, and the surging cost of imported inputs, all exacerbated by the steep naira depreciation and forex volatility.

“The expectation of MAN is to have a rate cut that is supported by a robust fiscal policy framework capable of facilitating improved access to long-term loans, enhanced productivity, and sustained economic growth,” the group said. It added that the present policy mix is skewed against production and investment.

Although Nigeria’s inflation rate fell marginally to 22.22% in June 2025 from 22.97% in May, food inflation remains stubbornly high and continues to climb. Experts say inflationary pressures have become structural, with major drivers such as insecurity, high logistics costs, naira volatility, and multiple taxes far beyond the reach of interest rate adjustments.

While manufacturers are the loudest voices, they are not alone. Agribusiness operators, particularly in food processing and commodity value chains, are equally suffocated by high borrowing costs and insecurity in production zones. With bank lending shrinking and microfinance institutions offering loans at 45% and above, many small businesses now rely on cooperative societies or shut down altogether.

MAN’s Policy Prescription

To reverse the trend, MAN rolled out a number of policy recommendations:

• Interest Rate Cut: MAN says the CBN must urgently slash the MPR to reduce the cost of credit, especially to critical sectors like manufacturing, agriculture, and energy.
• Nigeria First Policy: The group wants the government to adopt protectionist industrial policies that prioritize local content, encourage backward integration, and promote local patronage of Nigerian-made goods.
• Boost Agricultural Output: It urged the federal government to tackle insecurity in farming regions and fix logistics bottlenecks in agricultural supply chains. These, it said, will help reduce food inflation and raw material costs for agro-allied industries.
• Stimulate Consumption Through Income Redistribution: MAN emphasized that raising minimum wages, removing excessive taxes, and funding social protection programs could enhance consumer demand, which would in turn stimulate industrial output.

Backstory: MPC Standing Firm

At the last MPC meeting, CBN Governor Olayemi Cardoso said the decision to hold the rate steady was to maintain the momentum of disinflation, noting that the bank’s policies were beginning to show results. The slowdown in the inflation rate is an encouraging sign, he said.

However, analysts believe the marginal drop in headline inflation is not enough reason to maintain a policy that is clearly stifling production, discouraging investment, and worsening unemployment.

All 12 members of the committee voted to retain the rate, signaling a firm consensus in the apex bank to prioritize inflation control over growth stimulation—a move that MAN and other stakeholders fear could prolong Nigeria’s economic stagnation.

Some economists, including those at the Lagos-based Financial Derivatives Company, argue that the CBN should have started easing by now, especially after six months of aggressive hikes earlier in the year. They warn that keeping rates high could deepen the recession risk, especially with GDP growth at a slow pace and business confidence at a historic low.

Others support the CBN’s cautious approach, noting that a premature rate cut could weaken the naira further and reverse recent gains in foreign capital inflows.

Labour Party’s presidential candidate in the 2023 general elections, Peter Obi, has accused President Bola Ahmed Tinubu’s administration of manipulating Nigeria’s economic statistics to mask worsening hardship.

Obi said the government is using false and misleading data to deceive the public about the true state of the economy.

In a post on X (formerly Twitter), Obi referenced Tinubu’s own campaign remarks in 2022, when the then-candidate mocked him for using statistics, saying, “Na statistics we go chop? All I want is to put food on the table of Nigerians.” Two years into that same administration, Obi said, Nigerians are hungrier than ever while Tinubu’s government is “now overfeeding Nigerians with wrong statistics.”

“From wrong unemployment figures to wrong inflation numbers and now GDP debasing, this administration is only trying to paint a positive spin on our deteriorating economic and household conditions,” Obi said.

He emphasized that governance is not guesswork, but requires “sincerity of purpose, character, competence, capacity, and compassion.” The former governor has long warned that data manipulation can lead to disastrous policy choices that ignore the lived experiences of ordinary citizens.

IMF Too Has Raised a Red Flag on Nigeria’s Economic Data

Obi’s claims have gained more traction following fresh concerns from the International Monetary Fund (IMF), which recently flagged the accuracy and timeliness of Nigeria’s economic statistics. The Fund, early this month, highlighted deficiencies in data from the country’s fiscal, monetary, external, and financial sectors. It noted that Nigeria’s fragmented, outdated, and incomplete data infrastructure hinders effective policy monitoring, while delays and inconsistencies in key metrics complicate government planning.

One of the most troubling issues raised by the IMF is the “significant errors and omissions” in Nigeria’s balance of payments data, which make it difficult to assess the country’s true external position. These inaccuracies, the Fund warns, pose risks to financial stability and prevent sound macroeconomic management.

Following the rebasing of economic data methodology, the Tinubu administration has been rolling out a series of official data releases in recent weeks — including GDP, inflation, and unemployment statistics — amid growing skepticism over the credibility of those numbers. The National Bureau of Statistics (NBS) last week announced that Nigeria’s Gross Domestic Product (GDP) expanded by 3.3% in the second quarter of 2025.

However, some economists have noted that the numbers don’t align with the deteriorating welfare conditions on the ground.

Renowned economist and Financial Derivatives Company CEO, Bismarck Rewane, also warned against what he called “happy statistics and unhappy people.” In an interview with ChannelsTV last week, Rewane stressed that Nigeria must move beyond headline GDP growth and focus on real, inclusive progress that improves the lives of ordinary citizens.

“What we want to avoid are happy statistics and unhappy people,” he said. “You can grow as much as you want, you can do all. It must be about the welfare of the people. The people must feel it, must be happy about it. If not, you will have happy statistics and unhappy people.”

Rewane’s caution mirrors widespread concern that government officials are deploying numbers as propaganda tools rather than as a basis for addressing inflation, food insecurity, joblessness, and rising inequality.

Nigeria’s Position in Global Poverty

The World Bank’s Africa Pulse report, released in April 2025, underscored the severity of Nigeria’s poverty problem. The report revealed that Nigeria now accounts for 19% of sub-Saharan Africa’s extremely poor population, the highest share in the region. This means that more than one in every seven of the world’s poorest people now lives in Nigeria, putting into question the credibility of any rosy economic narrative.

This alarming trend persists despite the government’s claim of easing inflation. The NBS reported that Nigeria’s headline inflation slowed slightly to 22.22% in June 2025, down from 22.97% in May. But the data also revealed that prices rose faster month-on-month in June, 1.68%, compared to 1.53% in May, suggesting inflationary pressures remain entrenched.

Peter Obi has maintained a consistent focus on the disconnect between official numbers and real-world conditions. In April, he warned that Nigeria has more poor people than China, Indonesia, and Vietnam combined, a sobering indictment of decades of mismanagement.

This backdrop now raises a big question: whether the government will confront the mounting pressure to address the issue of inaccurate data and begin tackling the actual causes of economic distress, rather than manipulating the symptoms.

The Investments and Securities Act (ISA) of 2025 in Nigeria marks a significant legislative development for the country’s capital market, particularly in formalizing and regulating the warehouse receipt business. 

Tekedia Capital is looking for innovators who are establishing robust and efficient warehouse receipt businesses in these states in Nigeria: Kano, Abia, and Osun. Our goal is to support in strengthening the agricultural value chain, facilitate access to finance for producers, bolster commodity trading, and anchor derivative markets in Nigeria. The following are our immediate focus domains:

• Kano State: Facilities capable of handling various grain classes (e.g., maize, rice, sorghum).
• Abia State: Facilities dedicated to the storage and handling of palm oil.
• Osun State: Facilities specializing in cocoa bean storage and management.

The establishment of these warehouse receipt businesses will play a crucial role in:

• Providing secure and standardized storage for agricultural commodities.
• Enabling the issuance of credible warehouse receipts, which can be used as collateral for loans.
• Facilitating efficient trading of commodities on organized platforms.
• Reducing post-harvest losses through proper storage practices.
• Enhancing price discovery and market transparency.

If interested, send us an email with any public material that shows you’re working in this area; do not include any proprietary info.

Warehouse Receipt Business in Nigeria

The Investments and Securities Act (ISA) of 2025 in Nigeria marks a significant legislative development for the country’s capital market, particularly in formalizing and regulating the warehouse receipt business. Here’s a breakdown of what a warehouse receipt business entails in Nigeria, based on the ISA 2025:

What is a Warehouse Receipt?

At its core, a warehouse receipt is a document of title issued by a licensed warehouse operator, serving as evidence that a specified quantity and quality of a commodity (e.g., agricultural produce, minerals) has been deposited in a particular warehouse. It essentially represents ownership of the stored goods without requiring physical possession.

Key Aspects of the Warehouse Receipt Business under ISA 2025:

The ISA 2025 introduces specific provisions that are crucial for the development and regulation of the warehouse receipt system in Nigeria. These include:

1. Legal Framework for Commodities Exchanges and Warehouse Receipts: The Act contains a new part specifically providing for the regulation of commodities exchanges and warehouse receipts. This is a critical step towards developing a comprehensive commodities ecosystem in Nigeria.
2. Regulation and Licensing of Warehouses: The Act empowers the Nigerian Independent Warehouse Regulatory Agency (NIWRA), likely established or further strengthened by the ISA 2025, to:
   • License warehouses that store commodities to be traded on a registered exchange.
   • Regulate the operations of licensed warehouse keepers.
   • Classify licensed warehouses into categories.
   • Certify warehouse operators, including inspectors, samplers, graders, and weighers.
3. Issuance and Regulation of Warehouse Receipts:
   • The Act details requirements for the issuance of warehouse receipts, including electronic warehouse receipts (EWRs).
   • It outlines provisions for the management of lost, missing, or altered warehouse receipts and the issuance of duplicate receipts.
   • It clarifies the obligations of a warehouse operator to deliver goods to the holder of a valid receipt and outlines liabilities for wrongful delivery or failure to cancel receipts after delivery.
4. Negotiation and Transfer of Warehouse Receipts: The ISA 2025 establishes clear requirements for the negotiation and transfer of warehouse receipts, defining the rights derived from such negotiation and the rights and obligations of transferors and transferees. This facilitates the use of warehouse receipts as a financial instrument.
5. Establishment of a Central Registry: The Act provides for the establishment of a Central Registry for Warehouse Receipts. This central registry is crucial for maintaining transparency, preventing fraud, and ensuring the integrity of the warehouse receipt system.
6. Pledging Against Warehouse Receipts: The framework allows for the pledging of commodities held with a warehouse, against which a warehouse receipt (especially an EWR) has been issued, in favor of a financial institution. This enables farmers and traders to access finance using their stored commodities as collateral, thereby unlocking credit.
7. Standardization and Grading: While not explicitly detailed in every snippet, a robust warehouse receipt system inherently promotes uniform grading and standardization of commodities. This is essential for transparent trading on a commodity exchange.
8. Investor Protection and Market Integrity: The ISA 2025, in its broader scope, emphasizes investor protection and market integrity. This extends to the warehouse receipt business, aiming to build trust and confidence among participants in the commodity exchange market.

Benefits of the Warehouse Receipt Business in Nigeria (as envisioned by ISA 2025):

• Unlocking Dormant Assets: The Securities and Exchange Commission (SEC) sees the formalization of commodities and warehouse receipts as a way to unlock an estimated $500 billion in dormant agricultural and mineral assets, transforming them into tradable securities.
• Economic Diversification: It is a key strategy to diversify Nigeria’s economy away from its heavy reliance on oil and gas.
• Enhanced Liquidity and Financing: Warehouse receipts facilitate access to finance for farmers and traders, allowing them to use their stored produce as collateral. This injects liquidity into the agricultural sector.
• Price Discovery and Transparency: Trading of warehouse receipts on a commodity exchange contributes to transparent price discovery mechanisms.
• Reduced Post-Harvest Losses: By promoting formal warehousing and storage, the system helps reduce significant post-harvest losses often experienced by farmers.
• Increased Investment: A well-regulated warehouse receipt system is expected to attract both domestic and international investment into Nigeria’s commodities sector.

In essence, the Investments and Securities Act of 2025 provides a comprehensive legal and regulatory backbone for a thriving warehouse receipt business in Nigeria, aiming to transform the nation’s vast agricultural and mineral wealth into active and tradable assets within a robust commodity exchange market.

More on Warehouse Receipt

In the context of a commodity exchange, a warehouse receipt is a crucial document that transforms a physical commodity into a fungible, tradable asset. It’s essentially a certificate of ownership for a specific quantity and quality of a commodity that has been deposited in an exchange-approved and licensed warehouse.

Here’s a breakdown of its key aspects and how it functions in commodity exchange:

1. Proof of Ownership and Existence:

• When a producer, trader, or anyone with a commodity (e.g., grain, metal, coffee, crude oil) deposits it into a certified warehouse, the warehouse operator issues a warehouse receipt.
• This receipt serves as legal proof that the specified goods are in the warehouse and that the depositor (or the holder of the receipt) owns them. It guarantees the existence and availability of the commodity.

2. Standardized Quality and Quantity:

• For a commodity to be traded on an exchange, it must meet specific quality and quantity standards. The warehouse receipt certifies that the stored commodity meets these standards, often after inspection and grading by independent certifiers.
• This standardization is vital because it allows buyers and sellers to trade without physically inspecting each batch of the commodity. They can trust that a warehouse receipt for “Grade A corn” truly represents “Grade A corn.”

3. Fungibility and Tradability:

• The most important function of a warehouse receipt in a commodity exchange is to make the physical commodity fungible and tradable. Instead of exchanging physical goods, market participants can simply exchange the warehouse receipts.
• This allows for efficient and rapid transactions on the exchange. A buyer of a futures contract, for example, might receive a warehouse receipt at contract expiry instead of taking physical delivery of the commodity itself.

4. Collateral for Financing (Warehouse Financing):

• Warehouse receipts are widely accepted as collateral by financial institutions. This is a significant benefit for producers and traders.
• Instead of selling their commodities immediately after harvest (when prices might be low), they can store them in a warehouse, get a receipt, and use that receipt to secure loans. This provides them with immediate liquidity to meet operational costs or invest further, while allowing them to wait for more favorable market prices.

5. Facilitating Futures and Spot Markets:

• Futures Markets: Warehouse receipts are a critical component of the delivery mechanism for futures contracts. When a futures contract matures and leads to physical delivery, the seller delivers a warehouse receipt to the buyer, representing the underlying commodity. This avoids the logistical complexities and costs of physically moving commodities for every contract settlement.
• Spot (Cash) Markets: In spot markets, where commodities are traded for immediate delivery, warehouse receipts also simplify transactions. Buyers can purchase a warehouse receipt and then choose to take physical delivery of the commodity from the warehouse whenever they need it.

6. Central Registry and Transparency:

• Modern commodity exchanges often have a central registry for warehouse receipts, especially for electronic warehouse receipts (EWRs). This registry tracks ownership, transfers, and the status of all receipts.
• This central system enhances transparency, reduces the risk of fraud, and provides a clear audit trail for all transactions.

In essence, a warehouse receipt acts as the financial equivalent of the physical commodity, allowing for its efficient and secure trade on a commodity exchange, and facilitating financing against stored inventory. It transforms static inventory into dynamic capital.

*AI assisted on this article