Nigerian businesses grew more optimistic in May 2026, with confidence improving even as the country continues to grapple with insecurity, expensive borrowing, and multiple taxation.
The Central Bank of Nigeria (CBN) released its latest Business Expectations Survey showing the Business Confidence Index (BCI) climbed to 7.9 points in May, nearly doubling from 3.9 points in April.
What droves the improvement
The apex bank said two key factors boosted business sentiment:
| Factor | Contribution |
| Easing governance & policy concerns | 15.7% |
| Progress in economic diversification | 15.6% |
Businesses remain worried about energy supply challenges (26.7%) and geopolitical uncertainties (7.7%), which continue to weigh on operations.
Sector-by-sector confidence gains
All major sectors maintained positive expectations, with notable improvements:
Agriculture: jumped from 2.7 to 9.4 index points
Services: rose from 1.5 to 4.6 index points
Industry: increased from 8.8 to 12.5 index points.
The Mining and Quarrying sector recorded the strongest outlook at 63.6 index points, with the highest expansion expectations at 69.2 points.
Top business constraints remain stubborn
Despite rising confidence, businesses identified these five major obstacles:
Insecurity — 72.9 index points
High and multiple taxes — 70.3 points
High interest rates — 67.7 points
Unfavourable political conditions — 64.2 points
High bank charges — 64.1 points.
Financial challenges (59.7) and poor infrastructure (58.2) also rank among the top ten obstacles.
Six-month outlook: Optimism strengthening
The survey indicates business optimism remains positive over the next six months, with confidence levels strengthening across most sectors. Regionally, the North-East emerged as the most optimistic, while the South-East remained cautious about next-month outlooks.
What businesses expect for key indicators
Naira exchange rate: Gradual appreciation against the US dollar expected.
Borrowing costs: Will remain elevated despite other improvements.
Capacity utilisation: Slightly eased from 56.0% to 55.9%, reflecting ongoing production cost pressures.
All sectors expressed caution regarding employment conditions, with non-market services reporting the weakest hiring expectations.
Context: Economy shows growth
The CBN findings align with broader economic data. The National Bureau of Statistics reported Nigeria’s real GDP grew 3.89% year-on-year in Q1 2026, with aggregate GDP at basic prices rising to N110.79 trillion from N94.05 trillion—a nominal growth of 17.79%.
The findings suggest Nigerian businesses acknowledge ongoing reforms but continue navigating a difficult operating environment characterised by high costs and uncertainty.
