Economic reform shows promise, but the business world has not yet experienced its full benefits

The Nigerian Employers’ Consultative Association (NECA) says that despite signs of progress emerging from the Federal Government’s economic reforms, many businesses in the country are yet to experience the full benefits expected from the policy changes.

Speaking in Abuja on Sunday, the Director-General of NECA, Mr Adewale-Smatt Oyerinde, acknowledged that recent reforms, particularly the removal of fuel subsidies and the liberalization of the foreign exchange market, demonstrate the government’s commitment to transparency and market-oriented economic management.

According to him, these steps have contributed to increasing fuel availability, reducing supply disruptions and providing a positive signal to domestic and international investors regarding policy direction and consistency.

However, Oyerinde noted that the positive macroeconomic outlook has not provided widespread relief for the business world, especially Micro, Small and Medium Enterprises (MSMEs), which continue to struggle with rising operational costs and an uncertain business environment.

He observed that the depreciation of the naira has significantly increased production costs, weakened competitiveness and increased financial risks for many companies operating in various sectors.

“Many private sector operators have not experienced the expected benefits of these reforms as they continue to grapple with inflation, energy costs and exchange rate volatility,” he said.

The NECA chief explained that shrinking consumer purchasing power, coupled with rising production costs, has forced many companies to review expansion plans and adjust business operations to survive the prevailing economic conditions.

While assessing infrastructure and energy developments, Oyerinde acknowledged improvements in areas such as housing, industrial investment and local refining capacity, noting that these initiatives have helped increase fuel supply and created new opportunities for economic activity.

Despite progress, he identified electricity supply as the most pressing obstacle facing businesses across the country.

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“Even though reforms in the electricity sector are underway, electricity supply shortages are still a major obstacle to the productivity and competitiveness of businesses across the country,” he said.

Oyerinde further stated that although indicators such as foreign exchange reserves and government revenues have recorded improvements, the impact has not been felt significantly by businesses and households.

“Inflation, high energy costs, double taxation, logistical challenges and weak consumer spending continue to hamper productivity and limit business expansion,” he said.

He noted that many employers are still reluctant to undertake large-scale hiring due to high borrowing costs, exchange rate uncertainty and overall rising operational costs.

According to him, sustainable job growth will only be achieved through deeper structural reforms that can reduce business costs and increase access to affordable financing.

The Director General of NECA urged the government to intensify efforts to ensure stable electricity supply, reduce energy costs, harmonize taxes, maintain policy consistency and stabilize the foreign exchange market to strengthen economic recovery.

He also advocates greater investment in technical and vocational education, expansion of digital skills programs and stronger collaboration between government and the private sector to prepare the workforce for emerging opportunities.

Additionally, Oyerinde called for increased support for local manufacturing through the protection of made-in-Nigeria products, accelerated infrastructure development and increased security around important business and investment corridors.

Despite the existing challenges, he expressed optimism that if reforms are sustained and complemented with targeted interventions, businesses will eventually begin to experience broader economic benefits capable of driving growth, increasing employment and supporting long-term national development.