Nigeria’s business landscape continued to show expansion in December 2025, marking 12 consecutive months of growth, even as rising operating costs and softer consumer demand tempered confidence among firms. This continued expansion was revealed in the latest Business Confidence Monitor (BCM) report by the Nigerian Economic Summit Group (NESG) and Stanbic IBTC, titled “Rising Uncertainty Dampens Nigeria’s Current Business Conditions.”
According to the report, the Current Business Performance Index declined slightly to 112.0 points in December from 113.3 points in November, but still remained significantly higher than its level a year earlier. The sustained expansion shows that businesses are managing growth, albeit with growing caution.
“This broad-based moderation points to a more cautious business stance and subdued consumer demand,” the report noted, capturing the sentiment echoed across sectors.
Across the economy, all major sectors: Agriculture, Manufacturing, Trade, Non-Manufacturing, and Services, stayed in growth territory, though several saw slower momentum compared with the previous month.
Agriculture emerged as the strongest performer, with its BCM index climbing sharply to 112.9 points. Seasonal demand and better harvests boosted crop production and livestock activity, helping the sector hold its ground.
Manufacturing also saw modest gains, registering 117.9 points, driven mainly by expansion in food, beverages, textiles, and plastics. However, some sub-segments such as cement and basic metals recorded contraction, reflecting uneven performance within the sector.
Meanwhile, Trade (at 123.8 points), Non-Manufacturing (at 110.2 points) and Services (at 104.3 points) all reported slower growth. For trade, this was partly due to weaker consumer purchasing power, which offset festive season sales spikes. The services sector’s deceleration was linked to reduced activity in real estate, telecommunications, and professional services.
Several business indicators showed emerging stress. Sub-indices for production, access to finance, supply orders, and cash flow declined moderately, signaling that firms were becoming more cautious about investment and operational expansions. At the same time, the cost of doing business rose sharply to 61.6 points from 54.3 in November, underscoring persistent inflationary pressures and rising input costs.
Surveyed companies pointed to persistent challenges, including unreliable electricity, rising raw material costs, insecurity, and limited access to affordable credit as constraints that could slow the pace of future growth. These structural bottlenecks have long been cited as hurdles for business performance in Nigeria.
Despite the dampened growth pace, the Future Business Expectation Index remained elevated at 132.6 points, suggesting that many business leaders still expect gradual improvement over the coming months. That said, this represented a slight dip from previous readings, reflecting growing uncertainty about policy direction and broader economic conditions.
Adding further context to Nigeria’s economic climate, the Central Bank of Nigeria’s Composite Purchasing Managers’ Index (PMI) reached 57.6 points in December 2025, the highest reading of the year and a sign of robust private-sector activity. Strong output, better supply chain performance, and rising new orders contributed to this PMI improvement.
Despite the year-long expansion in business activity, persistent inflation, high borrowing costs, and infrastructure deficits continue to erode profitability and consumer purchasing power, limiting Nigeria’s economic growth potential and investment appeal. Targeted reforms in credit access and power supply are critical to sustaining momentum and attracting both domestic and foreign capital.
The December BCM data tells a story of resilience amid caution. While businesses have adapted to difficult conditions and maintained growth across major sectors, the combination of rising costs, faltering demand, and longstanding structural challenges highlights the need for policy clarity and reforms to unlock stronger, more inclusive growth in 2026 and beyond.
