PAMA Backs Nigeria’s new 5% GDP industrial financing goal

KEY POINTS

• Mansur Ahmed, President of the Pan-African Manufacturers Association (PAMA), has hailed the Nigeria Industrial Policy 2025 (NIP 2025) as a structural pivot toward a production-led economy.
• The policy, launched on February 17, commits the Federal Government to allocating up to 5% of Nigeria’s GDP annually to industrial financing.
• Manufacturing Targets: The five-year roadmap (2025–2030) aims to increase manufacturing’s GDP contribution to 15% by 2030 and 25% by 2035.
• Institutional Recapitalization: A core pillar includes recapitalizing the Bank of Industry (BOI) to ₦3 trillion by 2026 to provide long-term, low-interest capital.

MAIN STORY

Nigeria’s industrial landscape is undergoing a significant policy shift with the formal introduction of the Nigeria Industrial Policy 2025. Speaking through the PAMA monthly bulletin, Mr. Mansur Ahmed emphasized that the government’s commitment to the “Five-Per-Cent Signal”, allocating 5% of the national GDP to industrial funding is a decisive move to lower the cost of capital, which has historically stifled local production.

The policy, presented by Vice President Kashim Shettima on behalf of President Tinubu, is designed to transition Nigeria from a consumption-heavy market to an export-oriented hub. Beyond financing, the framework addresses “structural bottlenecks” such as energy deficits, port congestion, and regulatory overlaps. Ahmed noted that the strategy focuses on integrated value-chain development, specifically targeting agro-processing, renewable energy, and mining clusters to maximize the benefits of the African Continental Free Trade Area (AfCFTA).

While the design of the policy has been praised by stakeholders, Ahmed cautioned that “execution discipline” remains the ultimate test. The framework introduces an Interest Drawback Scheme for MSMEs, where firms receive interest refunds only after meeting performance milestones like job creation. This shift from upfront subsidies to accountability-based financing is intended to ensure that the ₦3 trillion recapitalization of the Bank of Industry translates into measurable industrial outcomes rather than “ghost” projects.

WHAT’S BEING SAID

• “Policy design has rarely been Nigeria’s central challenge; execution discipline has,” remarked Mansur Ahmed, President of PAMA.
• Regarding the funding: “By setting aside up to 5% of GDP for industrial financing… this government demonstrates its commitment to matching ambition with resources.”
• Vice President Kashim Shettima emphasized accountability: “We will measure success by the number of factories that open their gates at dawn [and] by the jobs created for our young men and women.”

WHAT’S NEXT

•  Federal MDAs have been directed to align their 2026 budget cycles with the NIP 2025 framework to ensure the first full year of the 5% GDP allocation is captured.
• The first tranche of the ₦3 trillion recapitalization for the Bank of Industry is expected to be processed by the end of Q2 2026.
• The Ministry of Industry is scheduled to announce the locations of three new “Special Economic Zones” focused on export-oriented agro-processing in late March.

BOTTOM LINE

The Bottom Line is that Nigeria is moving away from “accidental” industrialization toward a deliberate, state-backed production strategy. By pledging 5% of GDP to financing and targeting a 25% manufacturing share by 2035, the government is attempting to build an economic fortress that can withstand global oil price shocks. However, as PAMA suggests, the success of this ₦3 trillion gamble rests entirely on whether the government can maintain “execution discipline” over the next five years.