Nigeria’s Business Confidence Climbs for Sixth Month in 2025; Manufacturing Sector Drives Economic Recovery
Nigeria’s Business Performance Index showed sustained growth for the sixth consecutive month in June 2025, reflecting growing confidence and resilience in the country’s economy. According to the NESG-Stanbic IBTC Business Confidence Monitor report released in July, the Current Business Performance Index rose to 113.6 points in June, up from 109.8 points in May, maintaining a steady expansion above the 100-point growth threshold. The Business Confidence Measure, which gauges future expectations, also reached its highest level this year at 134.5 points.
The manufacturing sector led this economic upswing, with its index climbing sharply to 123.6 points in June from 114.4 in May. Key sub-sectors like Textile, Apparel & Footwear, Cement, and Plastic products contributed significantly to the growth through increased production and improved supply chains. Despite this progress, manufacturers face structural challenges such as raw material shortages, unreliable power supply, high import tariffs, inflation, and rising diesel prices that increase production costs.
Meanwhile, the non-manufacturing sector experienced a slowdown, with its index dipping for the second month in a row to 120.7 points in June from 122.2 points in May. The sector faces mounting pressures from high operating costs, energy price hikes, infrastructure deficits, and foreign exchange volatility. Some sub-sectors like Motor Vehicle and Assembly recorded declines, though the overall sector remained in expansion territory.
Access to finance remains the most critical constraint for businesses across all sectors, along with challenges such as unstable economic policies and high property rental costs. In response to these issues, the Manufacturers Association of Nigeria urged the Central Bank of Nigeria to cut the Monetary Policy Rate to ease inflation and boost real sector growth. However, the CBN’s Monetary Policy Committee recently maintained the rate at 27.5%, citing ongoing macroeconomic concerns.
Overall, the report highlights cautious optimism among Nigerian businesses as they navigate a challenging environment marked by inflationary pressures and policy uncertainties. The positive trend in the manufacturing sector offers hope for broader economic recovery, but sustained policy support and improved infrastructure will be essential to maintain momentum going forward.
Source: Nairametrics