Nigeria’s business environment remained in expansion territory in March 2026, but momentum weakened significantly as economic pressures intensified across key sectors.
This is according to the latest Business Confidence Monitor (BCM) released by the Nigerian Economic Summit Group, which showed that the Current Business Performance Index fell sharply to 101.2 points in March from 117.2 points recorded in February.
Although the index remains above the 100-point benchmark that signals expansion, the steep decline underscores a slowdown in the pace of growth. Compared to March 2025, when the index stood at 106.6 points, current performance also reflects softer year-on-year growth.
The report highlights a widespread moderation in business activity, with most sectors recording slower expansion and some slipping into contraction.
Manufacturing dropped to 103.4 points from 121.1, while Trade declined to 103.8 from 108.7. The Services sector maintained expansion at 104.7 points, though at a reduced pace.
In contrast, Non-Manufacturing and Agriculture sectors contracted, posting 98.4 points and 91.1 points respectively, signalling declining output and weakening demand in those segments.
A deeper sectoral breakdown points to an uneven and fragile business landscape. Within manufacturing, only sub-sectors such as food and beverages, metals, and pharmaceuticals sustained growth, while cement, plastics, and paper products recorded declines.
Trade activity was largely supported by retail, but wholesale trade slipped into contraction, reflecting weak distribution networks and uncertain demand conditions.
The Services sector recorded moderate growth across financial services, real estate, and professional services, though rising operating costs continue to erode gains.
Agriculture posted the sharpest downturn, driven by reduced crop production and weaker livestock activity, while forestry output remained largely stagnant.
Across the board, businesses continue to grapple with structural constraints, including limited access to finance, erratic power supply, rising rental costs, input shortages, and insecurity, factors that are weighing heavily on productivity and investment.
The NESG report also flagged declining investor confidence, with the investment sub-index remaining in contraction territory. This reflects a growing reluctance among businesses to commit capital amid heightened risks and uncertainty.
Key performance indicators such as export activity, operating profits, and new supply orders also contracted, pointing to declining competitiveness and profitability.
Meanwhile, the Future Business Expectation Index dropped to 128.0 points from 135.4, suggesting cautious optimism in the near term.
Sectoral outlooks were strongest in Trade (160.5 points) and Manufacturing (155.3 points), while Agriculture and Services recorded more subdued expectations.
According to the report, “the Trade sector’s continued expansion was driven by improved stockpiling and stronger cash flow conditions. However, businesses still faced significant challenges, including limited access to finance, insecurity, and unreliable power supply, which continue to disrupt supply chains and dampen investment appetite.”
The NESG also noted that rising global oil prices, fuelled by geopolitical tensions, are increasing energy costs and further shaping cautious business sentiment.
