The Centre for the Promotion of Private Enterprise (CPPE) has reported that Nigeria achieved notable macroeconomic stabilisation in 2025, setting the stage for stronger economic growth in 2026, despite lingering fiscal and structural challenges.
In its Review of the Nigerian Economy in 2025 and Outlook for 2026, signed by CPPE Chief Executive Officer, Dr. Muda Yusuf, the organisation said exchange-rate stability was the most visible achievement of the year.
According to the Centre, the naira traded largely within the ₦1,440–₦1,500 to the US dollar range, helping to restore predictability to business planning, ease imported inflation and boost investor confidence.
The report noted a sharp deceleration in inflation, which fell from 24.48 per cent in January to about 14.45 per cent by November 2025.
According to CPPE, the decline was driven by improved currency stability, easing logistics pressures and better supply conditions, with prices of several food items and imported consumer goods recording outright declines.
Business sentiment also strengthened during the year. The NESG–Stanbic IBTC Business Confidence Index remained in positive territory for most of 2025, reflecting improved investor perception and a gradual recovery in corporate profitability. Many firms that posted losses in 2024 returned to profit in 2025, the report said.
However, CPPE observed that federal fiscal performance remained weak. Rising debt-service obligations continued to constrain fiscal space, while revenue underperformance persisted, largely due to weaker-than-expected oil sector outcomes.
The 2025 federal budget, which assumed an oil price of US$75 per barrel and production of 2.06 million barrels per day, fell short of targets, with average oil prices around US$66 per barrel and production closer to 1.66 million barrels per day.
As a result, the projected ₦41 trillion revenue target was significantly missed, affecting capital expenditure implementation.
In contrast, sub-national governments recorded relatively stronger fiscal outcomes, supported by improved liquidity, stronger internally generated revenue performance and better execution of capital projects across several states.
On sectoral performance, the report said the services sector remained the main driver of growth, accounting for about 53 per cent of GDP by the third quarter of 2025.
The non-oil sector contributed 96.56 per cent of GDP and grew by 3.91 per cent, underscoring Nigeria’s gradual shift away from oil dependence.
Manufacturing growth remained weak at 1.25 per cent, constrained by power deficits, high logistics costs, import competition and limited access to finance, while agriculture grew by 3.79 per cent but continued to face challenges from insecurity and low productivity.
Looking ahead to 2026, CPPE expressed cautious optimism, projecting GDP growth of between 4.0 and 4.5 per cent, supported by moderating inflation and stronger non-oil sector performance.
The organisation said easing inflation could create room for gradual monetary easing, lower interest rates and improved private investment.
The report also highlighted positive capital market prospects, citing the potential listing of the Dangote Refinery as a development that could deepen market liquidity and attract both domestic and foreign portfolio inflows.
Nonetheless, CPPE warned of several risks to the outlook, including persistent security challenges, oil price and production volatility, high energy and logistics costs, rising debt-service obligations, estimated at over ₦15 trillion in the 2026 budget, external geopolitical headwinds, pre-election uncertainties and potential resistance to tax reforms.
Overall, CPPE concluded that 2025 laid a solid foundation for macroeconomic stability, noting that sustained reforms and improved security could enable 2026 to mark the beginning of a more robust growth phase with tangible improvements in living standards.
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