Nigeria’s industrial sector experienced a downturn in August 2025, with the Central Bank of Nigeria’s (CBN) Purchasing Managers Index (PMI) Report indicating a decline to 49.1 index points from 51.1 in July, signaling contraction. The report, released yesterday, highlighted challenges across key industrial metrics, including output (49.6 points), new orders (47.2 points), employment (48.9 points), and stock of raw materials (48.9 points), all reflecting reduced activity.
Despite the overall contraction, the suppliers’ delivery time index showed improvement at 52.4 points, indicating faster deliveries. Of the 17 industrial sub-sectors surveyed, seven reported growth, with transportation equipment leading the expansion, while ten sub-sectors, notably paper products, recorded significant declines.
In contrast, the services and agriculture sectors showed resilience. The services sector expanded for the seventh consecutive month, though its index slipped to 51.9 points from 52.8 in July. Agriculture maintained robust growth at 53.9 points, contributing to an overall economic expansion of 51.7 points in August, down slightly from 52.7 in July. This marks the ninth consecutive month of economic growth, with 22 of the 36 surveyed sub-sectors reporting increased activity.
The services sector’s performance was driven by growth in 10 of its 14 sub-sectors, underscoring its role in sustaining economic momentum despite industrial challenges. The CBN’s composite PMI of 51.7 points reflects Nigeria’s ongoing economic expansion, though the slowdown in industrial activity highlights structural issues such as limited financing, high input costs, and unreliable infrastructure, as noted in recent economic analyses.
The industrial contraction aligns with broader economic concerns, including a reported 44% surge in Nigeria’s trade surplus to N7.46 trillion in Q2 2025, driven by non-oil exports, which may not fully offset industrial weaknesses. Analysts suggest that targeted reforms to improve access to credit, stabilize power supply, and address input cost pressures are critical to revitalizing the industrial sector and sustaining Nigeria’s economic recovery.
