CBN: Multiple taxes, insec­ur­ity affecting busi­ness activ­it­ies

The Central Bank of Nigeria (CBN) says multiple taxes, high interest rates, insecurity, and inadequate power supply were the major challenges faced by businesses in October.

In its October 2024 Business Expectations Survey (BES) on Tuesday, CBN said despite the challenges faced, firms were optimistic in the month under review.

CBN said the survey was conducted in collaboration with the National Bureau of Statistics (NBS) from October 7 to 19, with a sample size of 1,750 business enterprises across Nigeria.

The BES covers key sectors, including industry, services, and agriculture. 

The industry sector comprises manufacturing, construction, mining, quarrying, electricity, gas, and water supply, while the services sector includes both market and non-market services.

Agriculture was assessed as a stand-alone sector.

“Respondents were optimistic about the overall business outlook in October 2024. However, insecurity, high interest rates, unfavourable economic climate, financial problems, and high or multiple taxes, inadequate power supply were identified as key factors constraining business activities,” CBN said.

According to the survey, the services and agriculture sectors showed positive indices, with business confidence of 1.0 and 5.0 points, respectively. 

In contrast, the industry sector recorded a negative sentiment, with a confidence index of -3.1 points.

Sub-sectors such as construction had 0 points, manufacturing recorded -2.5, electricity was 10.3, market services had 1.4, and non-market services recorded 17.6 points.

The overall confidence index (CI) for all surveyed sectors stood at 1.4 points in October, signalling cautious optimism among businesses about future macroeconomic conditions.

“The overall capacity utilization is positive for the month of October 2024 with Mining and Quarrying: Electricity, Gas and Water Supply being the most positive,” CBN said.

“All the sectors expressed optimism on own operation in the review month except for industry sector.

“Respondent firms were optimistic that the volume of business activities in November 2024, January 2025 and April 2025 would be favorable.”

In terms of employment and expansion, the survey showed that businesses hope to employ more workers in November 2024 except for the construction sector.

“An analysis of the Sectors showed that agriculture had the highest prospect for employment and expansion in November 2024,” the report reads.

The survey is part of the key economic reports CBN announced in August that it will release as part of its broader efforts to enhance transparency, promote informed decision-making and support economic growth.