The Nigerian Economic Summit Group has reported an improvement in business confidence in May 2026, attributing the positive development largely to a strong recovery in the manufacturing sector and robust consumer demand despite persistent cost pressures facing businesses.
According to the latest NESG Business Confidence Monitor, the Current Business Performance Index rose to 104.6 points in May from 102.1 points recorded in April, indicating a continued expansion in business activities across the Nigerian economy.
Despite the improvement, the report noted that the latest figure remained below the 109.8 points recorded in May 2025, suggesting that although business activities are expanding, the pace of growth remains fragile due to lingering economic challenges.
A sectoral analysis of the report showed that the manufacturing sector emerged as the strongest performer during the review period. Its business condition index rose significantly to 114.1 points in May from 98.7 points in April, signalling a return to expansion after an earlier contraction.
The services sector also recorded improved performance, with its index rising to 103.5 points from 101.5 points in the previous month.
Similarly, the trade sector strengthened during the period, with its business condition index increasing to 105.5 points from 102.7 points recorded in April.
The report stated: “Nigeria’s business environment improved, albeit recording fragile expansion in May 2026. Robust demand conditions largely reflect festivity-induced consumer spending.”
According to the NESG, strong demand conditions contributed to higher production levels, improved operating profits, stronger financial performance and increased supply orders across businesses during the month under review.
Survey findings contained in the report showed that major business indicators, including the general business situation, production levels, demand conditions, operating profit, financial results, access to credit, cash flow and employment, all remained firmly within expansion territory.
However, businesses continued to face significant challenges arising from elevated operating costs. The report identified rising input prices and the high cost of doing business as major concerns affecting firms across different sectors of the economy.
The NESG further highlighted limited access to finance, inadequate electricity supply, high office rental costs and worsening insecurity as major constraints undermining business operations and growth prospects.
The report also revealed that investment and export indicators remained in contraction territory during the review period.
In addition, trade stockpiling slipped into contraction, reflecting continued caution among businesses despite the broader improvement in economic activity.
According to the NESG, sustained reforms aimed at improving access to finance, enhancing electricity supply and addressing security challenges will be essential to strengthening business confidence and supporting long-term economic growth across the country.
