The Nigerian Economic Summit Group (NESG) has reported that businesses in Nigeria recorded a modest improvement in performance in January 2025, indicating an improved business environment and potentially improved business performance in 2025.
Specifically, in the ‘NESG-Stanbic IBTC Business Confidence Monitor – January 2025’ report released on Monday, the group reported that as a result of the improved environment, the current Business Performance Index for January 2025 stood at +8.12, reflecting a rise in business activities and a moderate improvement compared to +0.77 points in December 2024.
The report showed that during the month under review, businesses faced significant growth challenges this month, with inadequate power supply, availability of foreign exchange, limited access to financing, and unclear economic policies topping the list.
The NESG-Stanbic IBTC Business Confidence Monitor (BCM) is the flagship survey-based report of the supported by Stanbic IBTC.
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A further sub-sectoral analysis of the report’s findings showed broadly subdued outcomes, with negative performances in Non-manufacturing (-4.64), Services (-1.40), Trade (-0.84), and Manufacturing (-0.66).
However, the economic group noted that these sectors showed relative improvement compared to December 2024 and that in contrast, Agriculture recorded a weakly positive performance at +10.86.
The NESG further clarified: “Structural challenges in Nigeria’s business environment eased slightly, supporting the improved business performance observed during the month. Exchange rate stability and moderated price increases led to a slower rise in operational costs and consumer prices. The cost of doing business index declined to +47.58 from +50.32 in December, signalling reduced pressure on business growth. Access to credit improved slightly (+31.98) due to increased commercial activity at the start of the financial year. However, high financing costs remained a critical constraint on both current performance and future growth expectations.
“The most significant negative impacts were reduced investment (-27.50) and declining price levels (-26.62), which severely dampened overall business activity and demand.
“Frequent power shortages alongside limited foreign exchange availability, and restricted access to finance emerged as the most pressing challenges in January, constraining business expansion. These factors contributed to only weakly positive results in the general business situation (+44.82) and production levels (+23.74).
“A key concern remains the high exchange rate of the local currency against major trading currencies, which, alongside rising import costs, continues to erode profitability and disrupt pricing strategies. Limited access to financing persisted as a major structural barrier, further hindering business growth throughout the month”, the NESG added.
