KEY POINTS

• October business confidence sees 3.2 point drop in CBN survey.
• There is an expectation that the naira will further depreciate and it has a host of economic constraints.
• Employment and expansion prospects are strongest for the agriculture sector in November.

Business confidence in Nigeria’s economy has nosedived with the Central Bank of Nigeria (CBN) October Business Expectation Survey (BES) indicating a three point (3.2) decline in the Overall Confidence Index (OCI) to 14.5 from 17.7.

The survey mirrors concerns about the naira devaluation and myriad of other economic impediments that hinder operations of businesses in Nigeria.

Key points from the october survey

OCI projections for the current month, next month, and the next six months are down in the BES report.

A naira depreciation should mean firms could not muster confidence to spend on longer term investments in October, 7 — September’s OCI figures stood at 3.2, 6.2 and 29 points respectively.

Business constraints and sector outlooks

High interest rates, insecurity, high/multiple taxes, power supply issues and financial instability were also found to be major business challenges.

Despite these constraints, however, the Agriculture sector was the most optimistic regarding the opportunities to hire in and expand their business in November, compared to other sectors, neither of which were uniformly positive.

Businesses are cautiously optimistic and expect naira to appreciate within six months. Although there are substantial constraints on firms, some sectors are looking for growth opportunities in the near term.