Nigeria’s private sector has entered 2026 on a fragile path, with businesses facing rising risks around customers, technology, and talent despite signs of economic recovery.
This is according to a new report by the Nigerian Economic Summit Group (NESG), released recently.
The report, titled Nigeria Private Sector Outlook 2026: The Productivity Imperative for Nigerian Businesses, said the economy is shifting out of crisis but has yet to deliver real relief to companies.
“Nigeria’s private sector enters 2026 at a delicate inflexion point, transitioning from a period of acute macroeconomic instability to one of fragile but improving stability,” NESG stated.
It said, in 2025, the economy showed clear signs of improvement, as growth rose to 3.9 per cent, inflation slowed to 23.3 per cent from 33.2 per cent, and the naira stabilised within the ₦1,500–₦1,580 range against the dollar.
Foreign reserves also climbed to $45.5 billion, supported by a strong current account surplus.
Business activity improved during the year, with confidence rising and companies maintaining profitability despite high costs.
Key sectors like services and oil and gas drove growth, while agriculture and manufacturing lagged due to structural challenges.
However, the NESG said these gains have not fully reached businesses on the ground.
“The central challenge remains the disconnect between macroeconomic stabilisation and real sector performance,” it maintained.
Looking ahead to 2026, the group warned that risks are changing, shifting away from broad economic concerns to more direct pressures on businesses.
“The Nigerian enterprise landscape in 2026… signals a paradigm shift: market-centric pressures and digital vulnerabilities now eclipse traditional macroeconomic anxieties,’ it stated.
The biggest threat identified is falling customer demand, as rising costs continue to weaken purchasing power.
“Loss of Customers and Clients is identified as the paramount threat, with a high likelihood of occurrence,” NESG said.
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At the same time, companies are becoming more exposed to cyber risks as they move operations online.
“Digital vulnerabilities intensify with cloud migrations, amplifying anxieties over reputational harm and data compromise with profound operational fallout,” it said.
Sectors such as ICT, real estate, FMCG, and healthcare are among the most exposed to cyber and information breaches, while banking and telecommunications are seeing growing demand for cybersecurity solutions due to increased digital transactions.
The report also highlighted a worsening talent shortage driven by the continued exit of skilled workers from the country, adding infrastructure challenges as a major constraint, especially in power supply.
“The ongoing ‘Japa’ exodus has evolved from a Human Resource challenge, negatively impacting project delivery and operational continuity.
“Chronic electricity shortages proved the most persistent [constraint]… severely disrupting manufacturing and SMEs. Frequent grid collapses and high diesel costs forced many firms to operate at only 55–65 per cent of installed capacity,” NESG stated.
Despite these risks, the report said opportunities still exist in sectors such as agriculture, ICT, fintech, and manufacturing. Investment is expected to grow in agro-processing, while Nigeria’s fintech space continues to attract funding and support small businesses.
Manufacturing is also projected to recover slightly, although high costs remain a concern.
The banking sector is undergoing recapitalisation, which is expected to strengthen the financial system, while planned listings of major companies could deepen the capital market and provide new funding options for businesses.
To survive and grow in 2026, the NESG urged business leaders to rethink their strategies and reduce reliance on weak infrastructure.
“Private-sector leaders must move beyond a mere survival mindset towards an aggressive, strategic decoupling,” it said.
The group urges businesses to reduce risks by adopting off-grid energy for stable operations, sourcing inputs locally to limit import costs, and using digital automation to cut reliance on scarce skilled labour.
It also stressed the importance of protecting digital systems as a core business priority, stressing that cybersecurity spending should be viewed as ‘Revenue Insurance.
It added that while Nigeria has moved past its worst economic instability, 2026 will test whether businesses can adapt to new risks and turn fragile stability into real growth.
Alex is a business journalist cum data enthusiast with the Pinnacle Daily. He can be reached via ealex@thepinnacleng.com, @ehime_alex on X