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The Manufacturers Association of Nigeria (MAN) has expressed concerns over the Central Bank of Nigeria (CBN) decision to increase the Monetary Policy Rate (MPR) from 26.75 per cent to 27.25 per cent.

In a statement on Friday, the association said the decision has far-reaching implications for the manufacturing sector in Nigeria.

MAN’s Director General, Segun Ajayi-Kadir, explained in the statement that the continued increase in interest rates, which now totals 15.75 percentage points since May 2022, would compound the challenges faced by the sector, including rising production costs in the face of declining consumer purchasing power.

“With the increase in borrowing costs, manufacturers will now pay over 35 per cent on their credit facilities. Clearly, this will lead to an increase in production costs. higher prices of finished goods, lower competitiveness and production capacity expansion,” he said.

He noted that the impact of higher interest rates goes beyond compounding the challenges of manufacturers as it stifles opportunities for investment in crucial areas such as technology, retooling, and expansion within the manufacturing sector.

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