The Manufacturers Association of Nigeria (MAN) has raised concerns over the recent increase in the price of premium motor spirit (PMS), which jumped from N568 to N855 per litre. According to the association, the hike will exacerbate the already rising cost challenges faced by Nigeria’s real sector.
The Nigeria National Petroleum Company Limited (NNPCL) recently adjusted petrol prices upwards amidst widespread scarcity of the product, sparking fears of further economic strain. In a statement, MAN’s Director General, Segun Ajayi-Kadir, expressed the association’s concerns, noting that the manufacturing sector, which is already grappling with high operational costs, will bear the brunt of the fuel price increase.
Ajayi-Kadir explained that the price hike would have a ripple effect across the economy, leading to higher prices for other commodities. *“With the average Nigerian’s disposable income on the decline, this increase will further strain purchasing power and make essential goods more expensive,”* he said.
While admitting that a price increase was expected given global crude oil price trends and Nigeria’s reliance on imported fuel, Ajayi-Kadir stated that the country’s non-operational refineries continue to put additional pressure on the economy. *“The increase in the cost of crude oil will have a direct impact on the cost of importing fuel into Nigeria and, expectedly, the NNPC would at some point adjust domestic prices. Since fuel subsidies were reduced or removed, a price rise became inevitable,”* he added.
The petrol price surge is anticipated to have far-reaching effects on the Nigerian economy, especially for the manufacturing sector, which relies heavily on fuel for transportation and production. MAN continues to advocate for policies that will cushion the effects on manufacturers and help sustain the real sector.
