Credit Squeeze, Power Outages Weigh on Businesses Despite Growth—NESG

Limited access to finance and poor power supply continued to push up operating costs for Nigerian businesses despite a broad-based expansion in business activity in October 2026, according to the Nigerian Economic Summit Group (NESG).

In its latest Business Confidence Monitor, released on November 4, the NESG said, “Nigeria’s business activity sustained its expansion in October 2026.” The Current Business Performance Index stood at 115.4 points, down from 117.8 points in September but up from 111.3 points in October 2025.

All five sectors surveyed stayed in expansion territory, but only Trade and Services did better than in the previous month. Manufacturing, Non-Manufacturing and Agriculture grew more slowly.

The NESG said, “Notwithstanding the broad-based expansion, most firms continued to face key constraints, including limited access to finance, incessant power outages, elevated rental costs, infrastructural challenges, and insecurity, which amplified cost pressures during the month.”

The cost of doing business index stood at 45.2 points and the producer prices index at 65.5 points. Both are below the neutral 100-point mark, which the report said meant “a net majority of firms still reported elevated costs and producer prices.”

Both readings improved from September, when they were 39.2 and 58.0 points. The NESG said this implied “cost and price pressures eased but remained elevated in October 2026.”

On credit, the access to credit index stayed in expansion territory at 122.7 points but fell from 136.7 points in September. The cash flow index also dropped to 125.0 points from 140.4 points.

The report added that the export sub-index fell into contraction territory at 95.1 points, while the financial results index moved into expansion territory at 132.1 points.

“Despite sustained business growth, most firms grappled with key constraints, especially irregular electricity supply, credit squeeze, insecurity, high rental costs, and inadequate infrastructure,” the report said.

The Manufacturing index stood at 107.3 points, down from 108.4 points in September and 111.3 points in October 2025.

According to the NESG, “many manufacturers faced persistent constraints, including regular power cuts, short supply of raw materials, elevated rental costs, limited access to credit, and infrastructure challenges.”

Of the three largest subsectors, only Food, Beverage and Tobacco stayed in expansion territory and did better than in September. Textile, Apparel and Footwear, and Cement either moved into or stayed in contraction territory.

Non-manufacturing and energy

The Non-Manufacturing index fell to 107.7 points from 113.4 points in September. All subsectors except Oil and Gas Services stayed in expansion territory.

Oil and Gas Services, at 94.4 points, remained in contraction territory for the second consecutive month. The report said “key growth-inhibiting constraints persisted, especially incessant power outages, limited access to credit, infrastructure challenges, and elevated rental costs.”

Agriculture, Services and Trade

In Agriculture, the index stood at 113.8 points, down from 117.7 points in September. The NESG said many firms “continued to face growth-inhibiting constraints, including inadequate financing, energy shortages, insecurity, and infrastructure deficits.” Only Livestock performed better than in the previous month, while Fishing stayed in contraction territory.

The Services sector rose to 111.9 points from 107.7 points in September. The report said the sector “continued to face key challenges, especially regulatory bottlenecks, inadequate financing, infrastructure gaps, and energy shortages.” Telecoms and Information Services moved into contraction territory after two months of expansion.

Trade recorded the strongest performance, rising to 136.1 points from 128.5 points in September. Retail Trade did better than in the previous month, while Wholesale Trade grew more slowly. The report said players in the sector faced “credit squeeze, erratic power supply, high rental costs, and infrastructural challenges.”

The Future Business Expectations Index rose to 130.8 points from 128.9 points in September, which the NESG said “reflects improved optimism about short-term business conditions.”

Trade recorded the highest optimism at 194.0 points, followed by Manufacturing at 145.1 points and Non-Manufacturing at 135.0 points. Services (118.6 points) and Agriculture (117.0 points) were less optimistic.

The report said, “The overall positive outlook points to increased consumer demand associated with the festive season, along with campaign-related spending ahead of the forthcoming general elections.”

The NESG said the survey covers senior managers and business executives of firms that have operated in Nigeria since the beginning of 2023.