By Jennete Ugo Anya
Nigeria’s business environment sustained its expansion momentum in June 2026, with manufacturing, agriculture and trade recording positive performances despite persistent challenges including limited access to finance, unstable power supply, high operating costs and insecurity.
The latest Business Confidence Monitor (BCM) Index released by the Nigerian Economic Summit Group (NESG) showed that the overall business performance index remained at 104.6 points in June, unchanged from May 2026 and marking the sixth consecutive month of expansion.
Under the BCM measurement framework, index readings above 100 points indicate expansion, while figures below the threshold represent contraction.
Although the June performance reflected continued economic activity, it showed a moderation compared with previous periods. The overall index declined from 113.6 points recorded in June 2025, indicating that businesses were still expanding but operating under tighter conditions.
The report noted that performance across sectors remained uneven, with manufacturing and trade sustaining expansion, agriculture and non-manufacturing sectors improving into positive territory, while services recorded contraction during the month.
“Manufacturing and trade remained in expansion, but registered a weaker performance relative to the previous month. Agriculture and non-manufacturing also moved into expansion in June 2026, while services contracted during the month,” the report stated.
The manufacturing sector recorded 106.4 points in June, remaining above the expansion threshold despite declining from 114.1 points in May 2026 and 123.6 points recorded in June 2025.
The sector’s performance reflected mixed outcomes across its various subsectors. Textile, apparel and footwear emerged as the only subsector that recorded stronger growth compared with the previous month.
Food, beverage and tobacco, as well as pulp, paper and paper products, remained in expansion but recorded slower growth, while chemical and pharmaceutical products, wood and wood products, and non-metallic products moved into expansion territory during the month.
However, some manufacturing segments experienced setbacks. Cement, plastic and rubber products remained in contraction, while basic metal, iron and steel also declined into contraction.
Despite maintaining positive momentum, manufacturers continued to face structural challenges affecting production capacity and investment decisions. The NESG report highlighted limited access to credit, energy shortages, inadequate raw materials, infrastructure challenges and high rental costs as major constraints affecting businesses.
The agriculture sector recorded a stronger performance in June, with its BCM Index rising to 103.9 points from 97.5 points in May, moving the sector into expansion territory.
However, the improvement remained below the 108.9 points recorded in June 2025.
The report attributed the sector’s improved performance partly to favourable seasonal conditions, noting that early harvests and sustained rainfall supported increased crop production during the month.
“Business activity moved into expansion in crop production, agro-allied, and fishing. Notably, early harvests and persistent rainfall supported increased crop output during the month,” the report stated.
While crop production and related activities improved, the livestock subsector recorded contraction, with forestry also remaining in negative territory.
The non-manufacturing sector also recorded improvement, moving into expansion territory with its index rising to 106.8 points in June from 99.4 points in May.
The growth was supported by stronger activities in construction and crude petroleum, while natural gas and other non-manufacturing activities entered expansion during the period. However, oil and gas services remained under pressure and recorded contraction.
Beyond sector-specific performance, the NESG identified several business indicators that remained positive during the month. General business conditions, production, demand, operating profit, financial performance, supply orders, access to credit, cash flow and employment remained within expansion territory.
More than half of these indicators also showed stronger performance compared with May 2026, suggesting that businesses continued to demonstrate resilience despite economic pressures.
However, investment and export activities remained weak, while trade stockpiling moved into contraction. The report noted that although the cost of doing business moderated slightly, input prices remained high and continued to affect profitability.
“Firms continued to face major constraints, especially limited access to finance, power outages, high rental costs, and insecurity during the month,” the report stated.
The June BCM findings present a picture of an economy showing signs of resilience but still constrained by structural challenges. While productive sectors are gradually expanding, sustaining the momentum will require stronger interventions in infrastructure, financing, energy supply and business support systems.
For policymakers, the continued expansion of manufacturing, agriculture and trade highlights the importance of deepening reforms that can reduce production costs, improve competitiveness and encourage private sector investment.
