CBN report reveals deepening operational pressures despite cautious optimism on economic outlook….
Businesses operating in Nigeria have identified insecurity as their most pressing operational challenge in April 2026, ahead of multiple taxation, high borrowing costs, and escalating bank charges, according to the latest Business Expectations Survey released by the Central Bank of Nigeria.
The report showed that firms continue to grapple with a tough operating environment shaped more by security risks and cost pressures than by weak demand.
According to the survey, insecurity ranked highest among business constraints with a score of 74.1, followed closely by high or multiple taxes at 70.5. High interest rates came in at 67.4, while bank charges and competition recorded 62.8 and 61.8 respectively.
The apex bank noted that the findings point to an urgent need for improved security conditions, a more supportive fiscal environment, and reduced financing costs in order to strengthen business confidence and productivity.
The survey, conducted between April 6 and April 10, 2026, covered 1,900 enterprises across the industry, services, and agriculture sectors, with a response rate of 99.4 per cent.
Despite the challenging environment, businesses maintained a broadly positive outlook on the economy, although sentiment slowed compared to the previous month.
The report stated that the overall business confidence index remained in positive territory in April 2026, driven largely by expectations of improved policy direction and economic reforms.
It further showed that firms across all sectors expressed optimism about future economic conditions, with the industry sector recording the strongest confidence level.
Projections for business activity also remained upbeat, with expectations of improvement in May, July, and October 2026.
The CBN said the overall macroeconomic outlook stood at 3.9 index points in April 2026, while expectations for the next month, next three months, and next six months rose to 16.9, 27.0, and 34.6 index points respectively.
Optimism among respondents was largely driven by anticipated expansionary policy measures (19 per cent), improved access to finance (13 per cent), and expectations of economic diversification (13 per cent).
However, businesses also raised concerns about persistent energy challenges (35 per cent), governance issues (33 per cent), and geopolitical uncertainty (14 per cent), which continue to weigh on operating conditions.
Sectoral analysis showed the industry sector leading current confidence levels with 8.8 index points, followed by agriculture at 2.7 points and services at 1.5 points.
Regional disparities were also evident in the findings. Firms in northern Nigeria reported stronger optimism compared to their southern counterparts. The North-East recorded the highest confidence across all review periods, while the South-East and South-South posted negative sentiment in the current month at -11.9 and -10.6 index points respectively.
On sector performance, Mining and Quarrying recorded the strongest confidence at 65.2 index points, followed by manufacturing at 33.2 and agriculture at 32.9.
Businesses also expressed improved sentiment around orders, financial conditions, access to credit, and expected activity levels. The index for expected business activity stood at 23.3 points for the next month, rising to 29.6 in the next three months and 38.2 in the next six months.
However, employment outlook remained weak across all sectors. The report noted that hiring expectations were negative throughout the review period, reflecting continued caution among firms.
Manufacturing recorded an employment outlook index of -9.6, construction stood at -13.0, while mining and quarrying posted the weakest at -15.2 despite expansion plans in the sector.
In contrast, mining and quarrying also led expansion intentions at 84.6 points, followed by agriculture at 67.1 and market services at 62.5.
On currency expectations, respondents projected a gradual appreciation of the naira against the US dollar over the review periods, although borrowing costs were expected to remain elevated.
The survey also showed that average capacity utilisation improved to 56.0 per cent in April 2026, up from 52.5 per cent in the previous month, driven mainly by stronger demand, improved funding conditions, and seasonal production patterns.
Finally, the CBN noted that the methodology for the Business Expectations Survey was upgraded in April 2026, moving to a five-point weighted diffusion index to better capture the nuance of business sentiment across sectors.
