Nigeria’s manufacturing Purchasing Manger Index, which measures the general direction of economic trends in the manufacturing sector of the economy, stood at 48.5 index points in August, signalling the fourth consecutive month of contraction.
This was disclosed by the Central Bank of Nigeria‘s PMI Report for August issued on Wednesday.
A PMI above 50 usually represents an expansion when compared with the previous month, while a PMI below 50 means a contraction. A reading at 50 implies no change.
Manufacturing in Africa’s biggest economy has been facing a double whammy of supply chain disruption occasioned by the Coronavirus Disease crisis and acute shortage of foreign exchange availability, which has worsened the woes of a sector long plagued by arrested development.
The report showed that six of the 14 sub-sectors surveyed in the manufacturing industry recorded growth. They comprised non-metallic mineral products; cement; plastics and rubber products; transportation equipment; chemical and pharmaceutical products and textile, apparel, leather are footwear.
On the other hand, those that posted contraction included printing and related support activities; electrical equipment; petroleum and coal products; primary metal; furniture and related products; paper products; food, beverage and tobacco products; and fabricated metal products.
In the non-manufacturing sector, the PMI stood at 44.7 points, indicating the fifth consecutive contraction. Here, 16 of the 17 sub-sectors surveyed shrinked in the month under review.
The utilities sub-sector, the only one that did not contract, remained at the same spot, neither progressing nor drawing back.
The 16 sub-sectors that contracted were repair, maintenance/washing of motor vehicles; real estate rental and leasing; professional, scientific and technical services; management of companies; electricity, gas, steam and air conditioning supply.
This week, the statistics office reported that the Nigerian economy contracted by -6.10 per cent year-on-year in real terms in the second quarter of this year.
The International Monetary Fund has projected Nigeria’s GDP will fall by 5.4 per cent this year, but government believes it will shrink by 8.9 per cent.
