The Central Bank of Nigeria (CBN) has identified insecurity as the foremost challenge facing businesses in the country, according to its latest Business Expectations Survey. The findings highlight the growing importance of risk management in an economy marked by structural vulnerabilities rather than demand-side pressures.
Key Constraints Identified
In the April 2026 edition of the survey, insecurity ranked highest among business constraints with an index score of 74.1. High and multiple taxes followed at 70.5, while high interest rates scored 67.4. Businesses also cited high bank charges at 62.8 and stiff competition at 61.8 as major operational challenges.
The apex bank noted that the results indicate “the business environment was shaped more by risk and cost pressures rather than by demand-related factors,” underscoring persistent structural impediments facing enterprises across sectors.
Survey Methodology and Sample
Conducted between April 6 and 10, the survey sampled 1,900 firms spanning industry, services, and agriculture, achieving a response rate of 99.4 percent. The CBN revised its survey methodology from April 2026, replacing the previous three-point Likert scale with a five-point weighted diffusion index to provide “a more nuanced reporting of respondent sentiments.”
Cautious Optimism Amid Challenges
Despite the difficult operating environment, businesses maintained a cautiously positive outlook on the economy, although confidence moderated from the previous month. The overall business outlook on the macroeconomy stood at 3.9 index points in April. Respondents projected stronger sentiment ahead, with confidence expected to rise to 16.9 points in the following month, 27 points over the next three months, and 34.6 points within six months.
The improving sentiment was driven largely by expectations of expansionary policy measures, cited by 19 percent of respondents, while access to finance and anticipated economic diversification accounted for 13 percent each.
Structural Risks Persist
However, firms continued to express concerns over deeper structural risks. Energy-related challenges were identified as the most pressing concern by 35 percent of respondents, followed by governance issues at 33 percent and geopolitical uncertainties at 14 percent.
Regional and Sectoral Divergence
The survey also revealed sharp regional divergence in business sentiment. Sectoral analysis showed that the industry sector recorded the strongest confidence level at 8.8 index points, followed by agriculture at 2.7 points and services at 1.5 points. Among subsectors, mining and quarrying posted the highest confidence reading on business operations at 65.2 index points, ahead of manufacturing at 33.2 points and agriculture at 32.9 points.
These findings underscore the extent to which risk management has become central to business survival in an economy increasingly shaped by structural vulnerabilities rather than demand-side pressures.
