Northeast businesses continue to drive optimism for the economy among the nation’s six geo-political zones.
This is according to the Central Bank of Nigeria’s (CBN) December 2024 Business Expectation Survey.
“The outlook on the macroeconomy for the current month is driven by the current month is driven by respondents from all regions with the Northeast region being the most optimist,” CBN says.
The report revealed that optimism about the macroeconomic outlook for December 2024 is fueled by respondents across all regions, with the North-East emerging as the most optimistic. The region recorded a confidence level of 32.8%, significantly outpacing other regions such as the North-West (13.9%), North-Central (17.2%), South-West (15.5%), South-South (18.3%), and South-East (4.3%).
According to the survey, the North-East’s optimism stems from improved business conditions in key sectors such as agriculture, commerce, and small-scale manufacturing. Despite challenges in infrastructure and security, businesses in the region continue to demonstrate resilience, reflecting a positive outlook for economic activity and growth.
The CBN conducted the survey with a sample size of 1,900 business enterprises across Nigeria, achieving a response rate of 96.8%. Respondents were drawn from critical sectors, including industry, agriculture, trade, and services. These sectors play vital roles in shaping Nigeria’s overall economic trajectory.
Driving Economic Resilience
The North-East region’s performance, as highlighted by the survey, demonstrates its strategic importance to Nigeria’s economic recovery and diversification.
- Efforts to revive local industries, enhance agricultural productivity, and strengthen trade networks have contributed significantly to the region’s optimism.
- Analysts believe that this upward trend could stimulate investments in the region, creating a ripple effect on other parts of the country.
- The South-South and North-Central regions also recorded notable levels of optimism, reflecting robust activities in energy, oil and gas, and food production.
However, the South-East region’s relatively low confidence level of 4.3% suggests lingering challenges that require targeted interventions, particularly in infrastructure and investment incentives.
Mining businesses lead in capacity utilisation
The report also showed that businesses in the mining sector lead in average capacity utilisation. The overall average utilisation for the period under review was 55.6% overall. This is followed by agriculture (54.7%), Manufacturing (54.0%).
Key Takeaways
- While the North-East led in optimism, other regions also showed positive outlooks, demonstrating a collective recovery trajectory for Nigeria’s economy.
- The focus on industry and agriculture as key drivers emphasizes the importance of Nigeria’s non-oil economy.
- The CBN and other policymakers may leverage these insights to channel investments and support to regions with high growth potential, particularly the North-East.
- Mining sector leads in capacity utilisation across sectors.
