Nigeria spends $10bn annually on raw material imports – Minister

Nigeria spends about $10 billion annually on raw material imports despite having many of these resources in abundance, the Minister of State for Industry, Trade, and Investment, Senator John Owan Enoh, has revealed.

The minister also disclosed that the country loses an estimated $25 billion annually due to the underutilisation of its manufacturing sector, primarily caused by challenges in accessing raw materials.

Speaking at the launch of the Raw Materials Management Information System (RMMIS) and an e-registration portal for raw materials dealers and analysers in Abuja on Tuesday, Enoh described the situation as a major economic setback, noting that reliance on imported materials drains the country’s foreign exchange reserves and stifles industrial growth.

The system, developed by the Raw Materials Research and Development Council (RMRDC), is a digital platform designed to enhance industrialisation, attract investment, and optimise the country’s raw material resources.

“We can no longer ignore this stark reality of spending approximately $10 billion annually due to our heavy reliance on imported raw materials for our industrial journey and success when we have these materials in abundance,” the minister said.

According to him, this represents not only a massive loss of foreign exchange but also a missed opportunity to develop the nation’s natural resources and create jobs for the people.

The minister further disclosed that over 70 percent of Nigeria’s manufacturing inputs are imported, despite the availability of local alternatives, leading to unnecessary dependence on foreign supply chains.

He said the country’s manufacturing sector operates at a median average of 55.1 percent capacity due to constraints in sourcing raw materials.

He said this “underutilisation costs our economy an estimated $25 billion annually in lost potential output.”

Enoh revealed that the government was introducing the RMMIS and e-registration portal, designed to streamline raw material sourcing, enhance transparency, and connect businesses with local suppliers.

He said the platforms will provide critical data on available resources, facilitate linkages between manufacturers and local raw material providers, and ensure better regulatory oversight.

The minister called on stakeholders, including government agencies, manufacturers, and investors, to embrace the initiative and take advantage of the opportunities it presents.

Speaking, Minister of Innovation, Science, and Technology, Uche Nnaji, explained that the platform is expected to bring in $30 billion in investments over the next 10 years through efficient resource management.

The minister noted that the RMMIS is a national digital repository of real-time, accurate, and accessible data on Nigeria’s raw materials.

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Nnaji said: “This platform will empower manufacturers with reliable data for local sourcing, reducing import reliance and boosting domestic production. It will also attract investors, potentially bringing in $30 billion in investments over the next decade through efficient resource management.”

The minister lamented that the lack of comprehensive data on raw material reserves, quality, and locations has hindered industrial growth, leading to high import dependence and reduced investor confidence.

According to him, manufacturers struggle to source reliable local inputs, while investors hesitate due to limited resource visibility. He added that researchers and innovators also face challenges in developing new products without comprehensive data.

Nnaji added that with the platform, policymakers would have access to empirical data for targeted policies, which could increase semi-processed mineral exports to $9 billion by 2030.

Additionally, he said the agriculture, mining, and manufacturing sectors could maximise raw material use, fostering job creation and boosting investments by $20 billion in the next decade.

He said the initiative is also expected to conserve foreign exchange reserves, potentially saving $10 billion annually while strengthening the naira.

Director-General and Chief Executive Officer of the Raw Materials Research and Development Council, Prof. Nnanyelugo Ike-Munonso, described the RMMIS as a “groundbreaking initiative” that will provide real-time data for investors, manufacturers, and policymakers.

“The RMMIS is the first of its kind in Nigeria’s manufacturing sector. It will enhance data-driven decision-making, optimize resource allocation, and drive industry development,” he stated.

“The system, developed with support from key stakeholders and aligned with the RMRDC’s 10-year roadmap, covers over 17,000 data points on raw materials across Nigeria.

“It is expected to strengthen research and development, improve supply chain planning, and attract investment into the sector.

“The success of this initiative depends on active collaboration. We invite government agencies, industries, and development partners to integrate this system with other critical databases to unlock Nigeria’s full potential.”