By Emmanuella Opara | November 6th, 2026
KEY POINTS
- Nigeria’s Current Business Performance Index declined to 115.4 points in October from 117.8 points in September.
- Manufacturers and service providers continue to face rising operating costs due to unreliable electricity and infrastructure gaps.
- Manufacturing performance weakened to 107.3 points, while non-manufacturing activity fell to 107.7 points.
- The cost of doing business sub-index stood at 45.2 points, below the 100-point neutral threshold.
- Business expectations improved to 130.8 points, supported by anticipated year-end consumer demand.
MAIN STORY
Frequent electricity outages and inadequate infrastructure are increasing operating costs for Nigerian businesses, as manufacturing and non-manufacturing activities recorded slower growth in October.
The October 2026 Business Confidence Monitor by the Nigerian Economic Summit Group showed that Nigeria’s Current Business Performance Index declined to 115.4 points from 117.8 points in September, although it remained above the 111.3 points recorded in October 2025.
The report identified unreliable electricity supply, limited access to finance, high rental costs, infrastructure deficiencies and insecurity as major constraints affecting businesses across the economy.
Although all sectors remained in expansion territory, only Trade and Services recorded improved performance compared with the previous month. Agriculture, Manufacturing and Non-Manufacturing experienced slower growth, reflecting the difficulties businesses face in maintaining operations amid rising expenses.
The impact was particularly evident in the manufacturing sector, where the Current Business Performance Index dropped to 107.3 points in October from 108.4 points in September and 111.3 points in the corresponding period of 2025.
According to the NESG, manufacturers continued to contend with frequent power cuts, shortages of raw materials, high rental costs, limited access to credit and infrastructure challenges.
The slowdown was also reflected across major manufacturing subsectors. Textile, Apparel and Footwear moved into contraction territory, with its performance index falling sharply to 99.7 points in October from 127.5 points in September.
Cement remained in contraction at 94.5 points, while Food, Beverage and Tobacco was the only one of the three largest manufacturing subsectors to remain in expansion and record improved performance during the month.
Non-manufacturing businesses also experienced weaker activity, with their performance index declining to 107.7 points in October from 113.4 points in September and 115 points in October 2025.
The NESG attributed the moderation to persistent electricity disruptions, limited access to credit, infrastructure deficiencies and elevated rental costs.
Construction, a major component of the non-manufacturing sector, recorded a notable decline, with its business performance index falling to 114.2 points from 136.4 points in September.
The trade sector, however, recorded stronger activity despite continuing to face electricity-related challenges. Its Current Business Performance Index increased to 136.1 points in October from 128.5 points in September, supported by improved retail activity.
The cost pressures facing businesses were further reflected in the report’s business indicators. The cost of doing business sub-index stood at 45.2 points in October, while the prices sub-index was recorded at 65.5 points.
Both indicators remained below the 100-point neutral threshold, indicating that a net majority of businesses continued to experience elevated operating costs and producer prices, although the readings improved compared with September.
Despite the challenging operating environment, business expectations strengthened during the month.
The Future Business Expectations Index rose to 130.8 points in October from 128.9 points in September, indicating improved optimism about economic conditions over the following one to three months.
Trade recorded the highest level of optimism at 194 points, followed by Manufacturing at 145.1 points and Non-Manufacturing at 135 points.
The NESG attributed the improved outlook largely to expectations of increased consumer demand during the year-end festive period and ongoing campaign activities.
THE ISSUES
Unreliable electricity supply remains a major cost burden for Nigerian businesses, particularly manufacturers that depend on consistent power to operate production lines and process raw materials.
Frequent outages force businesses to make additional arrangements to sustain operations, adding to expenses at a time when access to affordable financing and other essential infrastructure remains limited.
The October figures also show that expansion in business activity does not necessarily translate into improved operating conditions. Although all sectors remained above the expansion threshold, declining performance across several sectors and persistently high business costs indicate that companies continue to face pressure.
WHAT’S BEING 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,” the Nigerian Economic Summit Group stated in its October 2026 Business Confidence Monitor.
WHAT’S NEXT
The NESG’s outlook points to stronger business expectations over the next one to three months, with increased consumer spending during the festive season expected to support activity.
However, the extent to which businesses benefit from anticipated demand will depend partly on their ability to manage electricity, financing and infrastructure costs.
BOTTOM LINE
Nigeria’s private sector remains in expansion territory, but persistent power outages and infrastructure deficiencies continue to increase operating expenses and weaken business performance. The latest figures highlight the gap between economic expansion and the cost of sustaining business operations.
