The Central Bank of Nigeria has released its October 2020 edition of the Business Expectation Survey Report – an exercise that was conducted by the Statistics Department of the apex bank.
The survey was conducted online with a sample size of 1,050 businesses nationwide between October 12 and October 16 with a response rate of 89.4%.
The sectors covered include Agric/Services, Manufacturing, Wholesale/retail trade, and Construction, which are made up of small, medium, and large corporations covering both import-oriented and export-oriented businesses.
Some factors were clearly identified to have inhibited business activities in October 2020, such as insufficient power supply, financial problems, high-interest rates, competition, unfavorable economic climate, unclear economic laws, unfavorable political climate, insufficient demand, access to credit, and lack of equipment.
- The respondents expect the average inflation rate in the next six months and the next twelve months to stand at 13.30% and 13.55% respectively. Though the respondents were not satisfied and raised concerns about how the government is currently tackling the issue of inflation in the country.
- The respondent firms expect borrowing rates to rise in the current month, next month, next 2 months, and the next 6 months with indices of 16.2, 13.5, 16.2, and 15.8 index points respectively.
- The respondents’ broad outlook on access to credit was negative at -2.1 index points in October 2020.
- The respondent firms expect a favorable business outlook for November and December 2020 with indices of 56.2 and 62.7 index points respectively.
- Some business sectors shall be employing in November and December as the outlook was considered positive at 19.5 and 22.5 index points respectively.
- The breakdown showed that Agric/services sector with 20.8 points has the highest prospects for employment in the next month, followed by the manufacturing sector with an index of 20.5 points, construction (11.4 points), and wholesale/retail trade (10.5 points).
- The business sectors with plans to expand in November include the Construction sector with the highest index of 64.7 points, followed closely by Agric/services sector with an index of 49.8 points, wholesale/retail trade sector 46.8 index points, and Manufacturing sector with 42.0 index points.
The business outlook for November 2020, December 2020, and April 2021, looks positive and promising for the respondent firms based on their renewed confidence in the economy, as they were quite pessimistic about the macroeconomic landscape in October 2020.