The Nigerian manufacturing sector grew 1.5 percent in the last quarter of 2023, while African manufacturing output contracted -0.7 percent.
This was made known by the data acquired from the UN Industrial Development Organization (UNIDO), which reflects Nigerian manufacturers’ resilience.
The manufacturing industry continued to face hindrances, with global manufacturing recording year-on-year (YOY) growth of only 1.5 percent, as stated by the UN agency. This singled out Nigeria (1.5 percent) and South Africa (1.7 percent) as the countries that recorded growth in the sector I’m African within the quarter.
“Limited data on Africa disclosed another quarter of shrinking manufacturing output (-0.7 percent) during the last quarter of 2023” – UNIDO.
“The growth patterns of the different countries diverged to a significant degree – Nigeria (1.5 percent) and South Africa (1.7 percent), for example, remained in positive territory, while Senegal (-5.5 percent) and Tunisia (-0.6 percent) recorded output reductions”.
“Manufacturing in Asia and Oceania recorded the highest YOY growth rate of 3.4 percent in the last quarter of 2023”, UNIDO stated.
Similarly, manufacturing output in Africa and Northern America was negative during the last quarter of 2023, crashing by 0.7 percent and 0.5 percent year over year.
In the last quarter of 2023, China, India, and Indonesia reported annual manufacturing YOY growth beyond 4 percent among countries.
“The manufacturing sector in most regions continued to face production losses during the last quarter of 2023”.
“The only exception was the region of Asia and Oceania, which achieved the best regional performance with a manufacturing expansion of 3.4 percent”.
In the meantime, the UN Trade and Development (UNTAD) has cited reasons for the increasing divestment of multinationals, especially from developing economies.
“Multinational enterprises are increasingly cautious about expanding their operations globally, especially in tangible assets,” UNTAD cited regarding its latest report on ‘Global economic fracturing and shifting investment patterns.’
In addition, a coordinated and sustainable response from global leaders will require an insufficient supply of highly qualified workforce in specific industries and increasingly frequent natural disasters, whose effects are already affecting production today”.
“Accelerated automation, political shifts towards interventionism and protectionism, and the imperative of sustainability, on the one hand, and heightened investors’ risk perception due to the pandemic and geopolitical tensions, on the other, are complicating the landscape of international investment.
“Another major shift is the rise of the services sector in attracting investment, taking over from manufacturing.
“The share of cross-border greenfield projects in the services sector rose from about 65 percent two decades ago to over 80 percent, and services-related investment within manufacturing industries nearly doubled to about 70 percent.
“Meanwhile, FDI in manufacturing has seen a significant downturn, with an average annual decline of over 10% in the three years following the pandemic outbreak.”
