Nigerian Business Confidence Hits Record High as Private Sector Growth Strengthens

Samuel Mobolaji

Nigeria’s private sector kicked off 2025 on a strong note, maintaining its growth momentum for the second consecutive month, according to the latest Stanbic IBTC Bank Nigeria Purchasing Managers’ Index (PMI) report. Business confidence soared to its highest level in over a decade, signalling increased optimism for economic expansion.

The headline PMI posted 52.0 in January, slightly down from December’s 52.7 but still above the 50.0 threshold, indicating sustained improvement in business conditions. The rise was driven by higher new orders, increased business activity, and a stronger commitment from clients to new projects. Companies responded by expanding employment, purchasing, and inventory levels, reinforcing the sector’s resilience.

A key highlight of the report was the sharp rise in business optimism. Sentiment regarding future output growth surged to its highest level since the survey began over 11 years ago. Firms attributed their confidence to expansion plans and aggressive marketing strategies expected to drive long-term gains.

Inflationary pressures, though still present, showed signs of easing. Input and output price increases slowed considerably, with overall input cost inflation at its lowest since April 2024, while charges rose at the weakest pace in six months. These trends suggest a more stable pricing environment, potentially benefiting businesses and consumers alike.

Growth was evident across three of the four monitored sectors, with wholesale and retail being the only exception. Firms also made significant progress in clearing backlogs of work, marking the sharpest decline in outstanding orders since June 2022. Additionally, suppliers’ delivery times improved, supported by better arrangements with vendors and prompt payments.

With growing demand, improved cost stability, and record-breaking confidence levels, Nigeria’s private sector appears well-positioned for sustained expansion in 2025. The strong start to the year signals a promising outlook for businesses, reinforcing optimism in the country’s economic trajectory.