Nigeria must urgently reduce the cost of production or risk conceding its growing African market to competitors, the Executive Secretary of the National Sugar Development Council (NSDC), Kamar Bakrin, has warned.
Bakrin spoke at the technical session of the 17th National Council on Industry, Trade and Investment (NCITI) in Enugu, where he presented what he described as the widening cost gap between Nigerian manufacturers and their counterparts in competing economies.
According to Bakrin, Nigerian factories pay between two and ten times more than competitors for critical inputs, including electricity, credit and logistics.
He said industrial electricity costs about eight US cents per kilowatt-hour in Vietnam and 10 cents in China, compared with about 15 cents for Nigerian manufacturers on the national grid.
The cost rises to nearly 30 cents when factories are forced to rely on diesel generators.
Bakrin said Nigerian manufacturers spent an estimated ₦1.34 trillion generating their own electricity last year, describing the situation as a “second, unwanted business” for factories.
He also noted that working capital costs between 27 and 35 per cent in Nigeria, compared with about nine per cent in Vietnam and three per cent in China.
On logistics, Nigeria ranks 88th out of 139 countries on the World Bank’s Logistics Performance Index, compared with Vietnam’s 43rd position and China’s 19th.
‘This Is Not a Demand Problem’
Bakrin said the challenge facing Nigerian manufacturers was not a lack of consumers but the high cost of producing goods.
“None of this is a demand problem. Nobody on this continent needs persuading to buy what Nigeria makes,” he said.
“It is a cost-of-production problem and that distinction matters, because costs, unlike demand, are within our power to fix.”
He said the challenge had become more urgent with the implementation of the African Continental Free Trade Area, which provides access to a market of about 1.4 billion people.
According to him, Nigeria must either become competitive enough to export to the African market or risk becoming a destination for goods produced by other countries.
“Either our goods are crossing borders going out, or everyone else’s goods are crossing ours coming in. We are either going to compete, or we are going to concede the market,” he said.
Bakrin cited the growth of Nigeria’s urea industry as evidence that targeted policies can transform domestic production.
He said Nigeria’s urea production capacity grew from about 500,000 tonnes in 2005 to 6.5 million tonnes today, making the country one of the world’s top ten nitrogen fertiliser exporters.
He attributed the growth largely to the decision to price natural gas as an industrial input rather than simply as a source of revenue.
“When a country prices inputs as if it wants industry to live, industry lives,” he said.
He also cited Vietnam’s emergence as a major electronics exporter and Bangladesh’s garment industry, which earns about $38 billion annually, as examples of countries that achieved industrial growth through long-term policy discipline.
Four Targets for Industrial Competitiveness
Bakrin proposed four key targets for Nigeria’s manufacturing sector.
These include delivering electricity to industrial clusters at between eight and 10 US cents per kilowatt-hour on a reliable basis; providing industrial lending at single-digit interest rates; reducing port clearance times to less than seven days from the current 18 to 21 days; and doubling output per worker by 2030.
“These are not aspirations to admire. They are the line at which a made-in-Nigeria product stops apologising,” he said.
To address the challenges, Bakrin proposed four resolutions for consideration by the Council.
He called for every state to designate at least one industrial cluster for a dedicated power arrangement within 12 months.
He also proposed a federal-state compact to harmonise levies and eliminate informal checkpoints along industrial corridors.
Other recommendations include the introduction of an annual State Industrial Competitiveness Index to publicly rank states on power, land, levies and logistics, as well as the enforcement of Nigeria First procurement policies at federal and state levels through quarterly compliance dashboards.
“Every resolution needs a named owner, a date and a way to measure it. Otherwise, it becomes another document that gets filed, framed and forgotten,” Bakrin said.
Support Must Be Tied to Performance
The NSDC executive secretary further argued that government support for businesses should be conditional on measurable performance.
He said tax credits, subsidised electricity and government patronage should be tied to independently verified production and other clearly defined targets.
“Nothing should be handed out as an entitlement — because once it is, it can never be taken back,” he said.
Bakrin also urged states to take greater responsibility for improving their investment climates by developing power markets under the Electricity Act 2023, making industrial land genuinely bankable, consolidating levies into a single published list and aligning technical education with the industries they seek to attract.
He said Nigeria’s industrial competitiveness would ultimately be determined at the sub-national level.
On his proposal for an annual ranking of states, Bakrin said: “We rank our football clubs every weekend. We can manage to rank our investment climates once a year.”
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He said improved industrial competitiveness could create jobs for the millions of young Nigerians entering the workforce annually, reduce prices, strengthen the naira through increased exports and import substitution, and support economic growth across the six geopolitical zones.
He also described productive employment at home as one of the strongest responses to the country’s continuing brain drain.
Bakrin urged the Council to begin future meetings by publicly assessing progress against six targets: increasing manufacturing’s contribution to 15 per cent of GDP; reducing industrial power costs to about 10 US cents per kilowatt-hour; bringing lending rates for manufacturers below 10 per cent; reducing port clearance times to less than seven days; reaching the 1.4 billion African consumer market; and absorbing the four million Nigerians entering the workforce annually into productive employment.
“The reform half of Nigeria’s story has been written,” he said.
“The industrial half will be written in kilowatt-hours, lending rates and port days. The window is open. No window stays open forever.”
Esther Ososanya is an investigative journalist with Pinnacle Daily, reporting across health, business, environment, metro, Fct and crime. Known for her bold, empathetic storytelling, she uncovers hidden truths, challenges broken systems, and gives voice to overlooked Nigerians. Her work drives national conversations and demands accountability one powerful story at a time.