COVID-19 Shrinks Nigeria’s Manufacturing Sector Further in July

Related stories

Ranked: Southeast Asian Countries by Wealth, Spending & Size

Southeast Asia is a perfect microcosm of the world...

Intimate Affairs: When a woman padlocks her honey jar, By Funke Egbemode

By Funke Egbemode For a woman, sex is not just...

What To Expect From Monday’s OPEC+ Meeting

OPEC+ looks set to stay the course at Monday’s...

Garba Shehu Speaks on Buhari’s Medical Trips Abroad

• Says, they Were Personal Preference By Abiola Olawale Garba Shehu,...

The Purchasing Manager’s Index, PMI report released by the Central Bank of Nigeria, CBN has revealed that the manufacturing sector for the third consecutive month in July to stand at 44.9 index points.

The PMI is a survey conducted by the CBN to show changes in the level of business activities in the current month compared with the preceding month.

The continued contraction in the manufacturing sector is reported to imply that unemployment may rise further in the economy.Central Bank of Nigeria CBN

Read also: CBN Bows To Pressure, Technically Devalues Naira By 15%

According to the Economic Sustainability plan recently released by the Nigerian government, unemployment may hit c.40% by the end of 2020— a trend that may leave the Nigerian economy in a sustained deep recession.

The latest figure shows marginal growth compared to 41.1 and 42.4 index points recorded in June and May 2020 respectively while the Nigerian economy remains on a tepid trajectory as the COVID-19 pandemic continues to disrupt both supply and demand chains of production.

The Central Bank of Nigeria CBN report usually has five PMI components, which include Production level, New Orders, Supplier Delivery time, Employment level, and Raw material inventory. In the month of July, four of the five components shrank in the following order: Production level (44.7), New orders (43.1), Employment level (40), and Raw material inventory (43.2).

Of the 14 surveyed subsectors, the transportation equipment subsector reported growth (above 50% threshold) in the reviewed month, while nonmetallic in the mineral products sector reported no change. The improvement in transportation must have been driven by the gradual easing of lockdown across the country.

However, the remaining 12 subsectors shrank in the following order: printing and related support activities; primary metals; fabricated metal products; paper products; food, beverage and tobacco products; chemical & pharmaceutical products; furniture & related products; electrical equipment; plastics & rubber products; petroleum & coal products; textile, apparel, leather & footwear, and cement.

Read also: 3 Capital Projects Set To Benefit As FG Receives Over $311 Abacha Loot From US

Also, the non-manufacturing PMI stood at 43.3 index points, indicating a contraction for the fourth consecutive month, though showing signs of recovery compared to 35.7 and 25.3 index points recorded in June and May respectively.

Of the 17 surveyed subsectors, only arts, entertainment & recreation, and transportation & warehousing recorded growth (above 50% threshold), while the remaining 15 subsectors recorded declines in July 2020.

Babajide Okeowo
Babajide Okeowohttps://newdiplomatng.com/
With a career spanning over a decade spent across the Business, Political and Entertainment beats of prominent media organizations in Nigeria, Babajide Okeowo has carved a niche for himself as a Journalist of repute. As a newsroom guru, he has penned several weighty narratives and designed content that speak to a news medium's values, vision and mission while ensuring that the content resonate pretty well with a variety of critical audiences across Nigeria and beyond. A consummate storyteller whose coverage of the business industry is valuable, Okeowo is blessed with a vast analytical mind and data interpretation skills. In his spare time, he interprets data for a Leading American University while also volunteering for a Non-Governmental Organization on Mindset Transformation. Okeowo is the Content Editor of The New Diplomat.

Subscribe

- Never miss a story with notifications

- Gain full access to our premium content

- Browse free from up to 5 devices at once

Latest stories

NDN
Latest News
Ranked: Southeast Asian Countries by Wealth, Spending & SizeIntimate Affairs: When a woman padlocks her honey jar, By Funke EgbemodeWhat To Expect From Monday’s OPEC+ MeetingGarba Shehu Speaks on Buhari’s Medical Trips AbroadThai-Cambodian conflict pits a well-equipped US ally against a weaker adversary with strong China links2027 : Why Kwankwaso is Mulling Presidential Run, Triggers Conflicting SignalsAGF Fagbemi Warns Gov Adeleke: Refund 7 Months LGA Funds in line with Supreme Court OrderWhat Europe's response to a no-deal with Trump could look likeOil Prices Climb Amid U.S.-EU Trade Hopes and Russian Export RestrictionsU.S. Refiners Rethink Crude Sourcing After Chevron Gets Venezuela Green LightPresidency, Kwankwaso Clash Over Claims of Northern MarginalizationNatasha Faces Full Suspension as Senate Goes on RecessGovernor mourns as Emir of Gusau, Ibrahim Bello, Dies at 712027: INEC Receives 10 New Applications, Brings total to 144 Seeking Registration As PartiesAnxieties as Congo's Ex-President Faces Trial in Court High-Stakes Treason, Murder Charges
X whatsapp