Insecurity and erratic power supply have again emerged as the most critical obstacles facing Nigerian businesses, according to the Business Expectations Survey (BES) for October 2025 released by the Central Bank of Nigeria (CBN).
The apex bank said firms across key sectors ranked insecurity highest at 71.8 points, followed closely by insufficient power supply (70.9), high or multiple taxes (70.2), high interest rates (68.4), and financial problems (65.6).
“Respondents identified Insecurity (71.8), Insufficient Power Supply (70.9), High/Multiple Taxes (70.2), High Interest Rate (68.4), and Financial Problems (65.6) as the top five (5) business constraints in October 2025, highlighting factors that directly impact operational stability and profitability,” the report read.
High bank charges (64.7), an unfavourable economic climate (63.0), and unclear economic laws (62.3) were also among the key concerns identified by respondents, while poor infrastructure (58.7) and an unfavourable political climate (57.5) ranked lowest.
The apex bank noted that “business constraints were more focused on financial factors than political challenges,” suggesting that cost-related pressures, not political instability, remained the dominant source of risk for firms.
Business confidence remains positive
Despite these challenges, the BES revealed a stronger sense of optimism among firms regarding the general state of the economy. The Overall Business Confidence Index (BCI) rose to 38.5 points in October 2025, from 31.5 points in September, indicating improving optimism among respondents about macroeconomic conditions. Confidence is expected to rise further to 45.6 points in November, 52.3 points in the next three months, and 52.5 points in the next six months, showing sustained improvement in sentiment as firms anticipate increased demand, higher sales, and a rebound in consumer activity.
Across major sectors, industry recorded the highest optimism (40.0 points), followed by agriculture (38.1) and services (37.6). This confidence, according to the CBN, is projected to remain strong through the first half of 2026, with industrial and agricultural firms sustaining their positive outlooks.
Regionally, the North-East led the optimism chart with 56.1 points, while the North-West and North-Central followed closely at 54.5 and 55.0 points, respectively. The South-South recorded the lowest confidence at 23.3 points, attributed to reduced output and lower business volumes in oil-producing areas during the review period.
Sectoral performance, hiring plans, and capacity utilisation improve modestly
All sectors expressed optimism about their own operations, with the Mining and Quarrying sector leading at 50.0 points, followed by Non-Market Services (31.7), Agriculture (27.1), Construction (26.3), Market Services (24.4), and Manufacturing (16.6). Firms also showed positive outlooks for business activity and total orders, posting 24.7 and 21.9 points, respectively.
On employment and expansion, the CBN reported that businesses anticipate hiring more workers and expanding operations in November 2025. The Mining and Quarrying sector had the highest expansion outlook at 80.0 points, while Construction ranked highest in employment prospects (36.8 points). This was followed by Agriculture (24.7), Non-Market Services (26.6), and Manufacturing (18.0).
The BES also recorded a modest rise in average capacity utilisation to 62.0 per cent in October 2025, up from 60.4 per cent in September. This improvement, the CBN said, “suggested a slight increase in resource use across the surveyed firms,” reflecting gradual recovery in industrial output and production activity.
Exchange rate and borrowing expectations remain cautiously positive
Businesses expressed moderate optimism about the stability of the naira, expecting gradual appreciation over the next six months. The exchange rate expectation index stood at 29.0 points for October, 32.8 points for November, 36.6 points in the next three months, and 39.0 points over six months. Similarly, firms anticipated a stable borrowing environment, with the borrowing rate expectation index at 10.3, 10.1, 12.9, and 10.5 points over the same periods.
The survey further noted that the volume of business activity is expected to rise gradually, with confidence indices projected at 41.4 points for November, 48.3 points in the next three months, and 50.2 points over six months, suggesting potential recovery in real economic activity.
What you should know
The Business Expectations Survey (BES) is a monthly assessment conducted by the CBN to gauge the sentiments of leading firms regarding the economy. It draws on data from the Business Establishment Frame jointly maintained by the CBN and the National Bureau of Statistics (NBS).
For October 2025, the survey was carried out between October 6 and 10, 2025, sampling 1,900 business enterprises nationwide. It achieved a response rate of 99.1%, covering three key sectors—industry, services, and agriculture. The CBN emphasised that the BES reflects respondents’ views and not its official position, noting that the report’s insights are used to track trends in business confidence and macroeconomic conditions.
