The Manufacturers’ Chief Executive Officers’ Confidence Index in the fourth quarter of 2024 increased modestly by 0.5 points from 50.2 points in Q3 2024 to 50.7 points in Q4 2024.
This is according to the MCCI Q4 2024 report released by the Manufacturers Association of Nigeria (MAN) and signed by its Director General, Mr. Segun Ajayi-Kadir.
The MCCI is a research and advocacy publication of MAN, which shows the perception of manufacturing operators and quarterly trends in the manufacturing sector.
400 CEOs of manufacturing companies across the six geopolitical zones are surveyed on the macroeconomic economy and government policies
Major insights
A breakdown of the diffusion indices reveals that in Q4 2024, the current business condition, current employment condition, and current production level “recorded improvement due to the moderate increase in consumer demand, especially during the festive period.”
- The current business condition scored 48.3
- The current employment condition scored 47.9
- The current production level is 47.5
It was, however, added that despite the moderate increase in the three indices, it is still below the 50-point threshold “as a result of the prevailing hostile macroeconomic environment.”
“Manufacturing operations were directly stalled by the lingering effects of the high cost of raw materials, energy, and logistics as the existence of high exchange rate, interest rate, and inflation rate remain unfavourable to the overall business environment,” the report notes.
The report adds that all the three indices are projected to be above the 50-point threshold in the first quarter of 2025
“The projected business condition in Q1 2025 slid from 56 points to 53.2 points. The projected employment condition also dropped from 53.8 points to 53 points while the expected production level declined from 54.3 to 54 points.”
It was also noted that manufacturers expect a more stable exchange rate, a halt in interest rate hikes, a decline in energy costs, and the implementation of the tax Reform Bills in Q1 2025.
“This indicates that despite a predicted slowdown in business activity for the first month of 2025, operators remain moderately optimistic by the expectations of a more stable exchange rate, halt in interest rate hikes, minimal decline in energy prices, and the enactment of favourable Tax Reform Bills by Q1 2025.”
Sectoral Groups’ Performance
The report notes that three sectoral groups declined while seven sectoral groups witnessed an improvement in confidence levels. The sectoral groups and their scores are as follows:
- The Basic Metal, Iron & Steel declined to 57 from 58 in Q3 2024
- The Electrical & Electronics scored 51.3, declining from 52.5 in Q3 2024.
- The Non-Metallic declined from 50.2 to 57. 6.
- The Pulp, Paper, Paper Product, Printing, Publishing, & Packaging had an increased confidence index of 52.9 from 51.5 points in Q3 2024
- Domestic/Industrial Plastic & Rubber to 51.3 from 48 in the third quarter
- Wood & Wood Products scored 51.2, rising from 48 in Q3.
- Chemicals & Pharmaceuticals scored 50.8 as against 50.5 in Q3 2024.
- Food, Beverages & Tobacco increased to 50.3 from 47.5 in Q3 2024.
- Textile, Apparel & Footwear scored 46.8, increasing from 44 in Q3 2024
- Motor Vehicle & Miscellaneous Assembly scored 44.8, against 44 in Q3 2024
