‘Government-led Reforms Support MSMEs Amid Cost Pressures’

Nigeria’s economy in 2025 showed signs of stabilisation, driven by government policy interventions and reforms, even as households and businesses continue to adjust to higher costs.

The News Agency of Nigeria (NAN) reports that after years of policy resets and market volatility, government-led initiatives helped improve key economic indicators.

This include Gross Domestic Product (GDP) growth, fiscal stability, and external reserves.
Real GDP is estimated to have expanded by about four per cent for the year, supported by higher oil production and strengthened non-oil sectors, reflecting government measures to boost productivity and investment.
Second-quarter growth was particularly strong, rising by over four per cent year-on-year, driven by agriculture, services, and upstream petroleum activities, areas targeted by government reforms and incentives.

International institutions responded positively to Nigeria’s policy actions.

The International Monetary Fund (IMF) adjusted its growth projection to nearly four per cent, citing improved investor confidence and the impact of reforms.

These reforms include exchange-rate realignment and the removal of petrol subsidies.
Development partners also noted improvements in government revenues and external reserves, crediting ongoing fiscal measures for supporting gradual stability in the budget.

In spite of these gains, inflation and operating costs continued to affect households and businesses, demonstrating the need for continued government intervention and support.
Describing the year, the national president of the Association of Small Business Owners of Nigeria (ASBON), Dr Femi Egbesola, said 2025 was “one of the most difficult years in the history of business owners”.
“The combined impact of inflation, insecurity, and unstable fiscal policies forced many enterprises into survival mode.
“Poverty increased, joblessness increased, insecurity increased. Infrastructure went from bad to worse,” he said.
In spite of the strain, Egbesola said many small businesses remain cautiously optimistic about the future.
“We are beginning to see some form of stability in fiscal policy. If the government consolidates, 2026 can be better.

“MSMEs are shifting focus towards self-driven solutions, export expansion and technology-driven innovation to remain competitive in global markets,” he said.

Egbesola added that currency depreciation could create export opportunities.

“Thus is because our currency is devalued, Nigerian products are cheaper in the global market. We can export more, attract customers and bring in foreign exchange,” he said.

In the manufacturing space, the Oyo State Chairperson of the Nigerian Association of Small and Medium Enterprises (NASME), Omotunde Ayankoya, said high production and logistics costs continue to limit business growth.

“What we buy as peanuts becomes expensive after logistics. At the end of the day, getting even five or 10 per cent profit is a big problem,” she said.

Ayankoya, who produces black soaps, called for stronger support for local production clusters and improved transport systems to ease cost pressures.

She advised new entrepreneurs to grow businesses gradually.

“Start with family capital. Loans should come when the business has taken shape,” Ayankoya said.

Ayankoya noted that recent initiatives provide better opportunities for formal financing.