High interest rates, unfavourable economic climate and insufficient power supply have been identified as the major constraints to businesses in the country.
The Statistics Department of the Central Bank of Nigeria said these in its ‘January 2020 business expectations survey report’.
Part of the report read, “Respondent firms identified insufficient power supply (66.2 points), high interest rates (57.1 points), unfavourable economic climate (54.6 points), and financial problems (52.8 points).
“Others are unclear economic laws (51.9 points), unfavourable political climate (46.3 points), competition (45.3 points) and insufficient demand (44.2 points) as major factors constraining business activity in the current month.”
It stated that respondent firms expected borrowing rates to rise in 2020 as the confidence indices stood at 6.0, 3.8 and 4.8 points respectively.
Respondent firms, it added, expected the naira to appreciate as their confidence indices stood at 26.2, 39.3 and 48.6 index points respectively.
It said further, “Respondents anticipated improvements in economic conditions as the index on economic growth rate in the short run stood at 34.5, 45.1 and 55.6 points for the current month, next six months and next twelve months respectively.”
According to the report, respondent firms expressed satisfaction with the management of inflation by the government, with a positive net satisfaction index of 3.1 in January 2020.
The net satisfaction index was the proportion of satisfied less the proportion of dissatisfied respondents, it added.
On employment and expansion plans, the CBN stated that respondent firms’ opinions on the volume of business activities (65.8 points) and employment (30.1 points) indicated a favourable business outlook for next month