Businesses in Nigeria say insecurity is the biggest constraint to their operations according to a survey conducted by the Central Bank of Nigeria (CBN).
This is contained in a report by the CBN titled, “Business Expectation Survey” published by its statistical department.
According to the report, insecurity as the biggest factor limiting businesses in the country was trailed by high interest rates, insufficient power supply, multiple taxation, extortion and corruption, unfavourable economic environment and so on.
The report states, “The respondent firms opined that insecurity was the major factor constraining the business activity in July 2024. Other constraining factors are high interest rate, insufficient power supply, and high/multiple taxes.”
Nigeria has battled with insecurity since the Boko Haram insurgency in the Northeast zone of the country which has been decimated significantly over the years.
However, in the past few years, new threats have risen across the different geopolitical zones in the country. Banditry and kidnapping currently ravage the Northeast and Northcentral regions significantly affecting agricultural activities across the regions and impacting food supply.
In the Southeast, secession struggles fuel insecurity in the region with regular sit-at-home orders which disrupt business activities.
The rising spate of insecurity across the country has pushed President Tinubu to moot plans for the controversial state/community policing model in the country.
Business Confidence across Northern Nigeria
Regarding business confidence across different regions, businesses in the North demonstrated greater optimism about the upcoming month, the next three months, and the next six months compared to their counterparts in the South.
Among the three zones in the North, only the North Central region exhibited a pessimistic outlook on business prospects, whereas, in the Southern region, all three zones reported a pessimistic business outlook for the near term.
Northeast region– Respondents in the Northeast zone expressed optimism about business activities for the month under review, with the overall Confidence Index reported at 23.6 points.
They also indicated optimism about the upcoming month, the next three months, and the next six months, with indices reported at 30.9, 42.0, and 48.2 points, respectively.
Northwest- businesses in the Northwest Zone were optimistic about business activities during the month under review, with the overall Confidence Index recorded at 2.4 points.
They also showed optimism for the upcoming month, the next three months, and the next six months, with indices at 0.9, 20.6, and 27.4 points, respectively.
North Central- in the North Central Zone– businesses surveyed were pessimistic about business activities during the month under review, with the overall Confidence Index standing at -1.7 points.
However, they expressed optimism for the upcoming month, the next three months, and the next six months, with indices recorded at 10.6, 16.6, and 31.5 points, respectively.
South-south region- Respondents in the South-South Zone were reported to be pessimistic about business activities during the month under review, with the overall Confidence Index at -6.5 points.
However, they expressed optimism for the next month, the following three months, and the next six months, with indices recorded at 2.3, 12.4, and 21.7 points, respectively.
Southwest– Respondents in the Southwest Zone were reported to be pessimistic about business activities during the month under review, with the overall Confidence Index at -1.5 points.
However, they expressed optimism about the upcoming month, the next three months, and the next six months, with indices recorded at 9.6, 19.8, and 34.0 points, respectively.
Southeast– in the Southeast Zone, businesses in the survey reported pessimism about business activities during the month under review, with the overall Confidence Index at -18.9 points.
They also expressed pessimism for the upcoming month and the next three months, with indices of -10.0 and -0.6 points, respectively. However, they were optimistic about the next six months, with the index recorded at 19.4 points.