Nigeria’s business climate recorded a modest improvement in August 2025, even as structural constraints continue to weigh heavily on growth.
This is according to the latest NESG-Stanbic IBTC Business Confidence Monitor (BCM) tiled “Mixed Signals: Strong Sectoral Growth Versus Structural Hurdles”.
According to the report, the Current Business Performance Index rose to 107.3 points in August, representing an increase of 1.9 points from its July 2025 level.
“This recovery was driven by stronger performance in technology, finance, manufacturing, energy, and logistics, supported by targeted investments and ongoing reforms.
“However, these gains were tempered by structural bottlenecks affecting operational efficiency and business profitability,” the report noted.
Trade, manufacturing, services recorded strongest rebound in August
According to the report, the sectoral review showed improvements across industries and broader economic activities with trade recording the strongest rebound in August following July decline.
Meanwhile, Manufacturing (106.2), non-manufacturing (116.2), Trade (114.1), and Services (103.7) all advanced in August compared to July 2025.
Conversely, Agriculture slipped into contraction territory, recording 95.6 index points.
This decline was mainly driven by contractions in Crop Production and Forestry sub-sectors.
The sector’s contraction, the report noted, is linked to multiple factors, including climate variability caused by delayed rainfall and shorter wet seasons, insecurity, and disruptions to crop planting that extended into August 2025.
“A breakdown of performance across the five agricultural sub-sectors revealed that two—Crop Production and Forestry—slipped into contraction, while Livestock and Fishing recovered from the weakness observed in July 2025. The three expanding sub-sectors—Livestock, Fishing, and Agro-Allied—recorded slight performance improvements compared to July 2025,” the report noted.
Key business challenges in August 2025
The report also noted that key sub-indices of the BCM, including investment, exports, access to credit, and prices, registered lower values relative to July 2025.
“The cost of doing business also rose in August, reversing the marginal relief of the previous month. Additionally, input prices continued to worsen during the period. Major constraints restricting growth and performance in August 2025 were limited financing access, unclear economic policies, unreliable electricity supply, high lease and rental costs, and persistent insecurity,” the report stated.
In Agriculture, the report identified challenges such as rising costs of poultry feed, fertilisers, and other critical inputs which have made operations more difficult.
“Rising production costs and declining consumer purchasing power are eroding margins. Price instability and volatile demand add further uncertainty. Consequently, many agribusinesses struggle to reinvest or expand operations, resulting in stagnation and, in some cases, outright closure,” the report noted.
With business conditions still fragile, the report says there is an urgent need for policy measures that stabilise the economy, improve infrastructure, strengthen security, and ease financing access to reinforce the sector’s resilience and contribution to national growth.
