Economic reforms yet to fully impact businesses, says NECA

The Nigeria Employers’ Consultative Association says businesses across the country are yet to fully experience the expected benefits of the Federal Government’s ongoing economic reforms.

Director-General of NECA, Mr Adewale-Smatt Oyerinde, said this in an interview with the News Agency of Nigeria on Sunday in Abuja while assessing the administration’s economic performance.

Oyerinde acknowledged that the removal of fuel subsidy and liberalisation of the foreign exchange market reflected the government’s commitment to market-driven economic policies and improved transparency across sectors.

He said the reforms had enhanced fuel availability, reduced recurring supply disruptions and signalled policy consistency to both local and foreign investors.

According to him, while there are indications of improved investor confidence, many domestic businesses, particularly Micro, Small and Medium Enterprises (MSMEs), continue to contend with operational challenges.

He said depreciation of the naira had increased production costs, affected competitiveness and heightened operational risks for many businesses.

“Many private sector operators are yet to experience the anticipated gains of the reforms as they continue to grapple with inflation, energy costs and exchange rate volatility,” he said.

Oyerinde said declining consumer purchasing power and increasing production expenses had placed pressure on businesses, with some firms adjusting investment plans and operations in response to prevailing economic conditions.

On infrastructure and refining, Oyerinde said developments in housing, industrial investments and local petroleum refining had created opportunities and contributed to improved fuel supply.

He, however, identified power supply as a major challenge facing businesses, citing persistent grid instability and reliance on alternative energy sources.

“In spite of the ongoing reforms in the power sector, insufficient electricity supply remains the number one constraint to business productivity and competitiveness across the country,” he said.

Oyerinde said that although some macroeconomic indicators, including foreign reserves and government revenues, had shown improvement, the gains were yet to be broadly reflected in business operations and household welfare.

“Inflation, high energy costs, multiple taxation, logistics challenges and weak consumer spending continue to constrain productivity and limit business expansion,” he said.

The NECA director-general said employers remained cautious about large-scale recruitment amid high borrowing costs, foreign exchange volatility and rising operating expenses.

According to him, sustainable job creation will depend on deeper structural reforms that reduce the cost of doing business and improve access to affordable finance.

He urged the government to prioritise stable power supply, lower energy costs, tax harmonisation, policy consistency and foreign exchange stability to accelerate economic recovery and strengthen investor confidence.

Oyerinde also called for increased investment in technical and vocational education, digital skills development and stronger public-private sector collaboration to enhance workforce readiness and enterprise growth.

He advocated support for local production through patronage of made-in-Nigeria goods, infrastructure development and improved security in key business and investment corridors.

Oyerinde expressed optimism that sustained reforms and targeted interventions would enable businesses to experience broader benefits capable of driving growth, employment and long-term economic development.