Mid-year review: Real economy remain under pressure — CPPE

By Yinka Kolawole

Nigeria entered the second half of 2026 with its strongest macroeconomic fundamentals in several years, but the gains have yet to translate into broad-based improvements in the real economy, according to the Chief Executive Officer of the Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf.

Reviewing economic performance in the first half of the year, Yusuf said exchange-rate stability, moderating inflation, stronger external reserves, improved crude oil production and resilient financial markets have significantly reduced macroeconomic vulnerabilities and strengthened investor confidence.

He noted that government revenues also improved on the back of higher oil receipts and stronger non-oil tax collections, while greater policy credibility helped sustain confidence in the financial markets.

However, he stressed that the benefits of macroeconomic stability have yet to filter through to businesses and households.

“The real economy remains under considerable pressure despite improvements in the macroeconomic environment. Businesses continue to grapple with elevated production costs, high interest rates, inadequate electricity supply, logistics bottlenecks and weak transport infrastructure, all of which continue to undermine productivity and competitiveness,” Yusuf said.

He observed that manufacturers, agriculture and micro, small and medium enterprises (MSMEs) remain constrained by the high-cost operating environment, resulting in only modest improvements in output, employment and household welfare during the first half of the year.

According to him, while macroeconomic stabilisation provides an important foundation for sustainable growth, “the next phase of reforms should focus on lowering production costs, improving productivity and strengthening the competitiveness of Nigerian enterprises.”

Yusuf identified critical reform priorities for the second half of 2026 to include improved electricity supply, better transport infrastructure, more efficient logistics and port operations, stronger security in farming communities and transport corridors, expanded access to affordable long-term finance for productive sectors, faster budget implementation and deeper domestic value addition.

He also urged the government to prioritise efficiency-enhancing reforms rather than imposing additional tax burdens on businesses.

Yusuf said although Nigeria now enjoys a much stronger macroeconomic platform than in recent years, the true measure of success in the months ahead will be whether reforms improve business competitiveness, stimulate private investment, create jobs and raise living standards.

“The quality of economic management in the second half of 2026 will be judged less by stable macroeconomic indicators than by the extent to which structural reforms reduce the cost of doing business and improve productivity,” he said.

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