An industrialist and manufacturer in the agricultural sector, Tertsegh Tor, has said it is more profitable to import goods than to manufacture them in Nigeria.

Speaking to Nigerian Tribune, he lamented that government is not giving enough attention to the processing sector. “Most of these packages exist on paper, so you, as a small manufacturer, the only facilities there for you to access are commercial bank facilities, which are not too friendly for manufacturing.

“In fact, it’s almost impossible for you to depend on them (referring to commercial banks) to grow your business. So, it’s easier for people to make money importing than going into manufacturing.”

He gave an example that few years back, his company used to supply rice in Lagos and other states, “but due to importation of foreign rice, demand for local rice has drastically reduced and those demands are no longer coming”.

Tor said he was struggling to stay in business because “now foreign rice has saturated his supply areas, so the demand for local rice has dropped drastically,” he stated.

Analysts are of the opinion that cheap imports undercut local production, while inadequate funding deprives small businesses of the cash required to survive competition, buy raw materials, or upgrade operational equipment.

They said foreign manufactured goods often benefit from mass production and lower production costs in their home countries. “This allows them to be sold in local markets at prices that local small industries, with their higher unit costs, simply cannot match.

“As consumers naturally gravitate toward cheaper goods, local small businesses lose their customer base, leading to unsold inventory and reduced revenue,” analysts stated.

Another industrialist, Achi Green told Nigerian Tribune that accessing government loans is difficult. “The process is long so is the wait, the only option is the commercial banks with unfriendly interest rates.

“Considering the cost of production in the country, by the time you produce and set price for the product, you hear complaints like the product is expensive compared to the foreign products version,” she stated.

The manufacturer of processed Ginger product explained that “that is why most people prefer foreign products and importers make more money than local manufacturers,” she stated.

Analysts said small businesses often struggle to secure loans. “When credit is available, commercial lending rates can exceed 30 percent, making it nearly impossible to finance operations and remain profitable.

“Without adequate capital or government grants, small industries cannot afford to invest in modern, automated machinery that would lower production costs and improve product quality.

Operational expenses—such as rent, wage and expensive backup power (e.g., generators in Nigeria)—require steady cash flow. A lack of funding leaves small industries unable to weather slow sales periods or absorb the high cost of doing business, eventually forcing them to fold,” he noted.

However, the Federal Government, some state governments, and organisations have established free trade zones to provide the needed infrastructure to ease cost of production in the manufacturing sector in Nigeria. These industry clusters still struggle with infrastructural deficit.

In many sectors like the sugar and automotive, the Federal government has given waivers and tariff to cover high cost of payment on duty, all in a bid to ease pressure on the manufacturers in those sectors, yet importation and demand of foreign products still persist in those sectors.

Analysts believe that to address these survival threats, business groups like the Manufacturers Association of Nigeria (MAN) continue to advocate for single-digit loan access, government patronage of locally-made goods, and import policies that encourage domestic value addition. (Nigerian Tribune)