Image: Dr Jumoke Oduwole, Minister of Industry Trade and Investment
The recent surge in global fuel prices, driven by geopolitical tensions, is compounding Nigerian manufacturers challenges, prompting their call for urgent government intervention to cushion the impact on small and medium enterprises and other critical sectors.
Making the calls are the Managing Director/CEO of Coleman Technical Industries Ltd, Mr George Onafowakan, and the Chairman of the Lagos Chapter of the National Association of Small-Scale Industries (NASSI), Mrs Gertrude Akhimien.
Proposed measures include targeted subsidies for essential industries, tax reductions on key services, and financial support for struggling businesses.
Onafowakan warned that while some manufacturers have temporarily absorbed the increases, the full impact could materialise within the next three to four months.
According to him, manufacturers in Nigeria have long adapted to unreliable grid power by investing heavily in alternative energy sources.
” No factory in Nigeria is built without factoring in alternative power, whether diesel or gas generators. Every manufacturer effectively operates as its own local authority when it comes to power supply,” he said.
Findings across major industrial zones reveal a sector heavily dependent on diesel-powered generators, with factories running at high energy costs to sustain operations.
Engineers and technical teams now work around the clock to monitor fuel consumption and prevent disruptions that could halt production lines.
Onafowakan stressed that power outages routinely stall factory operations, placing manufacturers under intense pressure to meet delivery timelines.
” When the lights go off, everything stops. We rely on generators, but the costs are rising, and there is constant uncertainty about meeting production targets,” he added.
By the second quarter, businesses may be forced to make difficult decisions around production planning and pricing. Beyond individual firms, the impact is already rippling across supply chains,” he said.
Mrs Gertrude Akhimien, also warned that the impact of rising fuel prices will extend beyond manufacturing to the broader economy.
She explained that higher transportation costs for raw materials and finished goods, as well as increased commuting expenses for workers, will significantly raise operational overheads.
“The cost of warehousing, distribution, and logistics will increase, putting additional pressure on already thin profit margins, particularly in low-margin sectors,” she said
Akhimien added that businesses would have little option but to transfer rising costs to consumers.
“This will inevitably lead to higher prices of goods in the market, as businesses pass on increased production and logistics costs,” she noted.
