WATCH THE VIDEO HERE A new report by the Nigeria Economic Summit Group (NESG) in partnership with Stanbic IBTC reveals that businesses continue to be strained by economic challenges such as high inflation and interest rate coupled with instability of the Naira in the foreign exchange market. The NESG-Stanbic IBTC Business Confidence Monitor for October states that the Nigerian business environment is characterised by weak performance and a bleak future. According to the report, the performance of businesses in the country in October at s -23.24 was weaker than the previous month with the top impediments to growth being inadequate power supply, insecurity and limited access to financing. The report noted that Nigeria’s country’s business environment is facing significant challenges due to persistent inflation, which is raising costs and reducing purchasing power. Furthermore, it noted major obstacles include limited access to finance, low employment levels, and restricted cash flow, all of which are pushing up operational costs, discouraging investment, and weakening demand. Also, Naira instability was highlighted as raising import costs and complicating financial planning, with low export performance also affecting profitability. The report states, “The country’s business operating environment continues to face severe challenges, with several underlying economic issues intensifying. Inflation remains high, eroding purchasing power and raising operational costs. Additionally, the Central Bank of Nigeria’s (CBN) hike in the Monetary Policy Rate (MPR) has led to higher credit costs, further straining business operations.” “Moreover, the Naira instability has raised import costs and complicated financial planning, negatively impacting profitability and pricing strategies. Export performance has also been weak, with businesses reporting below normal export order books, resulting in an export index of -12.65.” In October 2024, the NESG-Stanbic IBTC BCM index for the Agriculture sector showed a mildly negative business performance at -30.47 points. The Trade BCM index was reported at -23.45, indicating mildly negative business performance in the sector. Within its sub-economic activities, retail showed a mildly negative performance at -14.99, while Wholesale experienced a notably negative performance at -31.90.
Inflation, high interest rate, Naira instability continue to strain businesses in October- NESG report
