In November 2024, power shortages, exchange rate instability, and high inflation slowed business activity in Nigeria, driving up costs and limiting credit access.
Businesses in Nigeria has continued to face difficult challenges despite seasonal boosts from holiday shopping, harvests, concerts, and travel.
According to the Nigerian Economic Summit Group-Stanbic IBTC Business Confidence Monitor, power shortages, exchange rate instability, and limited access to finance hindered operations.
As a result, many companies relied on costly alternative energy sources, compounded by high fuel prices.
The report further emphasised persistent structural challenges, including high inflation and a depreciating naira, which kept operational costs and consumer prices elevated.
Although the year-end period typically brings increased demand, businesses struggled to cope due to economic pressures.
Specifically, the manufacturing, non-manufacturing, and services sectors reported negative performance, with scores of -3.65, -3.62, and -2.08, respectively.
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However, agriculture and trade saw modest positive growth at 1.17 and 0.32.
Moreover, the cost of doing business index surged to 51.50, while the Prices Index dropped to -32.05, reflecting mounting pressures.
Additionally, the Central Bank of Nigeria’s recent hike in the Monetary Policy Rate raised borrowing costs, making credit more difficult to access.
Furthermore, investment and exports also declined sharply, further limiting business activity.
Despite these challenges, Nigeria’s GDP grew by 3.46% in Q3 2024, largely driven by a 5.19% growth in the services sector.
The oil sector contributed 5.57% to the GDP, while the non-oil sector grew by 3.37%.
While the economy showed growth, businesses continued to struggle with power shortages, inflation, and high borrowing costs.
