Business confidence in Nigeria has risen for the third straight month in 2025 as the federal government reforms continue to raise optimism in the economy, according to the latest NESG-Stanbic IBTC Business Confidence Monitor (BCM).
The BCM, a flagship survey-based report by the Nigerian Economic Summit Group (NESG) in collaboration with Stanbic IBTC, shows that the Business Performance Index for March 2025 stands at +6.58. While this represents a slightly positive performance, it is a decline from +11.50 recorded in February.
A breakdown of sectoral performance reveals a mixed but largely positive trend.
“Non-manufacturing led with a strong +19.19, followed by Manufacturing (+8.25), Services (+5.51), and Trade (+0.51). However, aside from Non-manufacturing, all other sectors saw a dip in performance compared to the previous month,” the report noted.
The agricultural sector continued to struggle, recording a negative performance of -2.39 for the second consecutive month.
According to the report, structural challenges in Nigeria’s business environment have reversed some of the gains recorded earlier in the year. Despite this, the overall business situation remained positive, especially in areas like production levels, operating profits, cash flow, and employment.
However, key indicators such as the cost of doing business and access to credit deteriorated slightly in March, slipping to +48.44 and +18.28 respectively, from +47.18 and +24.84 in February.
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The most significant negative factors impacting business operations were reduced demand conditions (-7.50), a drop in investment (-13.33), weakened export activity (-2.42), and declining price levels (-5.18). These indicators, along with other challenges, contributed to a general slowdown in business activity during the month.
While not the most critical issue in March, the high cost of commercial lease and rental properties remained among the top three business concerns for the second month in a row.
“Persistent power shortages, limited access to financing, high commercial property costs, and unclear economic policies were the most pressing challenges facing businesses. Limited financing, in particular, remains a structural barrier to growth,” the report stated.
Despite these headwinds, business sentiment for the near future remained cautiously optimistic. The Business Confidence Measure (BCM) posted a positive index of +28.04, reflecting expectations of improvement in the next one to three months. Although slightly lower than February’s figure, this optimism is driven by anticipated gains in financial results, business conditions, profits, production levels, and cash flow.
Sectoral outlooks were mixed. Manufacturing and Non-manufacturing sectors showed moderate optimism, while Services, Agriculture, and Trade were more cautious. Compared to February’s higher index values, these sectors saw a notable decline in confidence, likely due to persistent macroeconomic pressures.
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Still, the General Business Index rose to +62.71, indicating broad-based optimism for the short term.
“Contributing factors included stronger demand conditions (+36.03), investment outlook (+41.78), spare capacity (+3.12), financial results (+70.50), supply orders (+24.51), and price expectations (+9.12).
Other major drivers of confidence included the production index (+55.19), export index (+24.19), operating profit index (+60.50), cash flow index (+58.55), and employment index (+44.79),” it noted.
Together, these indicators suggest expectations of increased business activity and improved financial performance, even in the face of lingering economic challenges.
