Nigeria’s path to economic transformation hangs on a strategic shift from primary production to manufacturing, Paul Alaje, Chief Economist at SPM Professionals, said.
 
Speaking on the impact of local production on the economy during a recent interview, Alaje cited the Dangote refinery as evidence of how domestic manufacturing can stabilise foreign reserves. He noted that before the refinery began operations, Nigeria’s reserves declined sharply due to the importation costs of refined petroleum products.
 
He categorised countries into three tiers: those operating solely on primary production and remaining ‘beneath’, those that process raw materials into finished goods rise ‘above’ and advanced economies that move ‘beyond’ through sustained manufacturing excellence. 
  
He drew parallels with South Korea’s industrialisation, Japan’s electronics revolution and Germany’s post-war recovery through manufacturing, noting that these countries transformed their economies by prioritising production over consumption.
 
“The economic miracle of Nigeria that we expect as a country, whether you are in the north or in the south, whether you are in the east or you are in the west, is in manufacturing,” he said.

He further argued that increased manufacturing would strengthen Nigeria’s foreign reserves, boost the currency’s value, and attract real sector investment beyond portfolio investments. Research papers support this position, showing that countries with stronger reserves typically experience currency appreciation and increased investor confidence.
 
He acknowledged recent policy reforms, including the removal of subsidies and market liberalisation, but stressed that the government must now focus on creating an enabling environment for manufacturers, particularly through improved security.

Drawing from his three-year study of China’s economic transformation, he highlighted how the Chinese government created a manufacturing roadmap that galvanised private sector participation and diaspora investment, ultimately establishing China as the world’s manufacturing hub.

While acknowledging Nigeria may not immediately become a global manufacturing centre, he urged the country to aspire beyond being merely “a country of commerce and farming” to become “the manufacturing centre of the entire Africa”.