The Manufacturers Association of Nigeria (MAN) has expressed worry over the impact of the hike in petrol price on the Nigerian economy, particularly the manufacturing sector, saying it could worsen inflation.
Director-General of MAN, Mr Segun Ajayi-Kadir, in an interview with the News Agency of Nigeria (NAN) in Lagos on Wednesday, said the increase could lead to increase in transport fares and prices of goods and other services.
He said that this would leave citizens with less disposable income and reduced demand for non-essential goods and services, thereby affecting businesses across sectors.
He said that the consequences might include a rise in inflation figures which would negatively impact household budgets.
Ajayi-Kadir said that while the performance of the manufacturing sector would be negatively impacted, businesses might need to adjust their pricing, which could lead to reduced profit margins if consumer demand would weaken.
“Small and medium-sized enterprises, which often operate on thin margins, could be particularly hard-hit. The increased costs could force some to scale down operations or even shut down if they are unable to pass on the additional costs to consumers,” he added.
