Lagos: The Centre for the Promotion of Private Enterprise (CPPE) has expressed optimism that Nigeria’s economy will expand more strongly in 2026, citing major gains in macroeconomic stability achieved in 2025.
The think tank highlighted improvements in exchange rate management, inflation control, and business confidence as the foundations for sustained growth.
It said that the country recorded gains, especially in exchange rate management, inflation, and business confidence.
CPPE’s Chief Executive Officer (CEO), Dr Muda Yusuf, disclosed this in a statement while presenting the organisation’s review of the economy in 2025 and its outlook for 2026.
He said that 2025 provided a strong foundation of stability, adding that with sustained reforms and improved security, 2026 could witness more robust growth and better living standards.
According to him, the most notable achievement in 2025 was the stability of the Naira, which traded largely between N1,440 and N1,500 to the dollar.
He said that this stability boosted business confidence, reduced imported inflation, and made pricing and investment planning more predictable.
He added that inflation also dropped sharply from 24.48 per cent in January to about 14.45 per cent in November, strengthened by improved supply conditions and reduced logistics pressures.
According to him, prices of many food items and imported goods fell during the year, leading to improved consumer sentiment.
Yusuf said that business confidence also strengthened throughout the year, adding that many companies that recorded losses in 2024 returned to profitability in 2025.
On fiscal performance, he said federal government revenues fell short due to lower-than-expected oil prices and weak oil production.
He added that the 2025 budget was based on assumptions that did not materialise, including oil production of 2.06 million barrels per day and an oil price of 75 dollars per barrel.
Yusuf said that actual production averaged 1.66 million barrels, while prices hovered around 66 dollars.
According to him, this led to a significant shortfall from the projected 41 trillion naira revenue target and weakened capital expenditure performance.
He, however, disclosed that many states performed better, with stronger internally generated revenue, improved liquidity, and better project execution.
Reviewing sectoral performances, he said that the service sector remained the strongest driver of growth, accounting for 53 per cent of GDP by the third quarter of the year.
“Telecommunications, finance, construction, real estate, and trade led the expansion,” he said
He said the non-oil sector grew by 3.91 per cent and accounted for over 96 per cent of GDP.
According to him, manufacturing remained weak, contributing only 7.62 per cent to GDP and growing by 1.25 per cent due to power shortages, high logistics costs, unfair import competition, and rising operating expenses.
Yusuf noted that Agriculture recorded a modest recovery, growing by 3.79 per cent, though insecurity and low productivity remained major obstacles.
Looking ahead, the CEO said that the outlook for 2026 is one of cautious optimism.
He projected GDP growth of 4-4.5 per cent, supported by lower inflation, stronger consumer demand, and possible monetary easing.
He said that services would continue to drive growth while capital markets could receive a major boost from a potential listing of the Dangote Refinery.
Meanwhile, he warned of risk factors, including insecurity, volatility in oil prices and production, high operating costs, fiscal pressures, geopolitical tensions, and political uncertainties.
Yusuf noted that growing resistance to tax reforms could also affect revenue projections.