Nigeria's business environment continued to expand in June 2026, though at a slower pace compared to the previous year. High operating costs, limited credit access, and persistent infrastructure challenges continued to exert pressure on businesses.
The Nigerian Economic Summit Group (NESG) reported in its June 2026 Business Confidence Monitor (BCM) that the Current Business Performance Index remained unchanged at 104.6 points in June, mirroring the level recorded in May.
However, this reading was notably lower than the 113.6 points recorded in June 2025, indicating a deceleration in business expansion despite some sectoral improvements. While manufacturing, agriculture, non-manufacturing, and trade sectors stayed in expansion, the services sector experienced a contraction during the month.
Sectoral Performance Mixed
Sectoral performance presented a mixed picture in June. Agriculture returned to expansion, with its Business Confidence Index rising to 103.9 points from 97.5 points in May, driven by early harvests and consistent rainfall that boosted crop production. However, livestock and forestry activities remained under pressure.
Manufacturing maintained its expansionary status at 106.4 points, though this was a decline from 114.1 points in May and 123.6 points a year earlier. Improvements were seen in Textile, Apparel, and Footwear, while Food, Beverage and Tobacco, Cement, Plastic and Rubber Products, and Basic Metals recorded weaker performance.
The Non-manufacturing sector moved back into expansion with an index reading of 106.8 points, largely due to stronger activity in construction and crude petroleum. Conversely, oil and gas services remained in contraction.
The Services sector, however, slipped into contraction with an index of 98.5 points. This was primarily due to weaker performance across financial institutions, telecoms, real estate, and broadcasting. The Trade sector remained in expansion at 102.0 points, but wholesale activity slowed, and retail trade contracted.
Persistent Headwinds and Future Optimism
Businesses continued to grapple with significant headwinds in June 2026. Limited access to finance, erratic electricity supply, infrastructure deficiencies, insecurity, and regulatory uncertainties continued to constrain investment, squeeze profit margins, and weaken employment growth across various sectors.
Despite these operational challenges, Nigerian businesses expressed optimism regarding short-term economic conditions. The NESG Future Business Expectation Index increased to 128.4 points in June from 127.0 points in May, signaling stronger business confidence over the next one to three months.
NESG attributed this improved outlook partly to easing geopolitical tensions in the Middle East, which contributed to lower global crude oil prices. Crude oil averaged $87.7 per barrel in June, a decrease from $112 per barrel in May.
Nigeria's economy recorded an overall real GDP growth of 3.89% year-on-year in Q1 2026. The trade sector contributed 17.89% to the country’s Gross Domestic Product (GDP) in the first quarter of 2026.
