Nigerian Businesses Seek Urgent Reforms as High Operating Costs Continue to Hurt Companies

ABUJA, Nigeria — The Abuja Chamber of Commerce and Industry (ACCI) has called for stronger economic reforms to address the persistent challenges facing Nigerian businesses, particularly micro, small and medium-sized enterprises (MSMEs), manufacturers and households.

The chamber made the call through its National Policy Advocacy Centre (NPAC) during a policy webinar held on Thursday, November 12, to examine the impact of economic reforms introduced by the Federal Government since 2023.

The discussion brought together representatives of government institutions, private-sector organisations, civil society groups and economic policy experts to assess whether recent government policies are improving business conditions or creating additional financial pressure for enterprises.

Participants acknowledged that Nigeria had recorded some positive economic developments, including improved exchange-rate stability, stronger investor confidence and moderating inflationary pressures. However, they warned that these improvements had not sufficiently translated into lower production costs, affordable financing or stronger consumer purchasing power.

High Operating Costs Continue to Pressure Businesses

One of the major concerns raised during the discussion was the continued increase in the cost of operating a business in Nigeria.

Many companies face high energy expenses, transportation costs, expensive raw materials and other operational challenges that affect their ability to remain profitable.

Small businesses are particularly vulnerable because they often operate with limited financial resources and have less capacity to absorb unexpected increases in expenses.

The Technical Adviser to the National President of the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), Ambassador Suleiman Audu, highlighted the difficulties confronting enterprises despite some improvements in the wider economy.

He noted that businesses continued to struggle with high operating costs, limited access to finance and weak consumer demand.

These challenges can affect production, reduce investment and make it difficult for companies to expand their operations.

Expensive Financing Remains a Major Challenge

Access to affordable credit was another important issue discussed during the webinar.

Many Nigerian businesses require loans to purchase equipment, acquire raw materials, expand production and meet daily operating expenses.

However, high borrowing costs and strict lending requirements can make financing difficult, especially for smaller enterprises.

Economic policy expert and Chief Executive Officer of the Centre for the Promotion of Private Enterprise, Dr. Muda Yusuf, stressed the importance of addressing structural problems that continue to prevent businesses from benefiting fully from economic reforms.

He called for improved access to affordable financing, lower production costs and greater consistency in government policies.

Participants also emphasised the need for financial institutions and policymakers to create conditions that allow businesses to obtain funding on more manageable terms.

Government Highlights Business Environment Reforms

Representatives of the Presidential Enabling Business Environment Council (PEBEC) also outlined government efforts to improve the country's business environment.

Olu Shirin Obafemi discussed initiatives targeting regulatory efficiency, digitalisation, transparency and improved responsiveness among government agencies.

He disclosed that 69 business-facing agencies had been assessed, with 98 per cent compliance recorded.

He also highlighted the Regulatory Impact Analysis framework, which requires evidence-based assessments before new regulations are introduced.

Other initiatives discussed included efforts to improve port efficiency and reduce delays in cargo clearance through automated inspection systems.

These measures are intended to reduce administrative bottlenecks and make it easier for businesses to operate and move goods across the country.

Calls for Stronger Government Accountability

Participants argued that introducing new policies would not be sufficient unless existing reforms were properly implemented.

They identified poor policy coordination, inadequate infrastructure, high financing costs and insufficient stakeholder consultation as some of the obstacles affecting businesses.

The discussion also highlighted the importance of transparency in public spending and ensuring that projects included in government budgets are implemented on time.

ActionAid Nigeria representative Hajia Suwaiba Muhammad raised concerns about the effects of subsidy removal, exchange-rate liberalisation and electricity tariff increases on households and vulnerable groups.

She called for stronger social protection measures to reduce the pressure on ordinary Nigerians.

A Proposed 90-Day Business Reform Compact

Among the recommendations presented during the webinar was a proposed 90-day Business Reform Compact.

The proposal is intended to accelerate outstanding reforms, strengthen government accountability and address challenges that directly affect businesses.

Participants also recommended better coordination of fiscal, monetary and trade policies, improved digital trade processes and stronger cooperation between government institutions and private-sector organisations.

The National Policy Advocacy Centre said recommendations from the discussion would be consolidated into a communiqué and submitted to relevant government institutions, including the Federal Ministry of Industry, Trade and Investment.

What Happens Next?

The latest intervention by the Abuja Chamber of Commerce and Industry highlights the importance of measuring economic reforms by their practical impact on businesses and households.

Although improvements in economic indicators can strengthen investor confidence, companies still need reliable electricity, affordable financing, efficient transportation and predictable government policies to operate successfully.

For Nigerian businesses, the immediate priority remains reducing the cost of production and creating an environment where companies can expand, employ more workers and compete effectively.

The proposed 90-day Business Reform Compact could provide a framework for addressing some of these challenges, but its effectiveness will depend on whether government institutions act on the recommendations.

For now, business leaders are calling for a stronger connection between economic policy announcements and the everyday realities of Nigerian enterprises.