The confidence index of chief executive officers in the manufacturing sector slightly diminished in the fourth quarter of 2022 (Q4’22) to 55 points from 55.4 points in the preceding quarter (Q3’22).
This was revealed in the Manufacturers CEO’s Confidence Index (MCCI) report of the Manufacturers Association of Nigeria (MAN), made available to Vanguard yesterday.
The report attributed the decline in the Aggregate Index Score (AIS) of MCCI to challenging operating environment during the period.
It stated: “The decline in the Aggregate Index Score (AIS) underscored the persisting challenges and the waning confidence of manufacturers in the economy in Q4’22 over the recorded points in the preceding quarter.
“The AIS declined in the quarter under review due to the persisting increase in the Consumer Price Index (CPI), continuous erosion in Naira value, difficulty in sourcing forex for productive use, high cost of energy, the issue of insecurity and the lingering Russian-Ukrainian war including the associated adversities.
“These issues among others are principally responsible for the difficult operating environment and its declining implication on manufacturing activities in the country during the quarter under review.”
Sectoral analysis of the report shows that the Index Score of Pulp, Paper, Printing & Publishing (49.6 points) and Motor Vehicle & Miscellaneous Assembly (48.4 points) fell below the 50 benchmark points.
The scores indicate a gross loss of confidence in the economy by manufacturers operating in the two sectoral groups.
MCCI is a research and advocacy publication of MAN, which measures changes in pulse of operators and trends in the manufacturing sector quarterly, in response to movements in the macroeconomy and government policies using primary data generated from direct surveys of over 400 Chief Executive Officers of MAN member-companies.
The Index has a baseline score of 50 points and scores above the baseline indicate improvement of manufacturers’ confidence in the economy, while an index score of less than the baseline suggests deterioration in the operating environment.