The Centre for the Promotion of Private Enterprise (CPPE) has called on the Federal Government to take decisive steps to stabilise energy costs and broaden access to affordable finance for productive sectors, even as Nigeria’s inflation rate eased in October 2025. The economic think tank emphasised that despite recent improvements in headline inflation, businesses—especially small and medium-sized enterprises (SMEs)—continue to operate under extremely challenging conditions marked by high costs, volatile energy prices, and limited access to credit.
In a policy brief shared with Nairametrics, CPPE’s Chief Executive Officer, Dr. Muda Yusuf, highlighted that the current moderation in inflation, while encouraging, is still fragile. Without deep structural reforms, he warned, the easing trend could quickly reverse. Yusuf stressed that stabilising energy prices and ensuring affordable financing are essential to strengthening the productive base of the economy and supporting sustainable growth.
According to the CPPE, the business environment remains under intense pressure. Energy-related expenses—in particular the cost of powering factories, shops, farms, and digital operations—remain among the biggest contributors to inflation and the most critical barriers to business competitiveness. Many SMEs reportedly spend a significant portion of their operating budgets on diesel, petrol, and alternative power sources because of inconsistent grid supply and rising tariff costs.
To reverse this trend, the CPPE urged the government to accelerate reforms that improve energy supply and reduce costs. The organisation recommended increased investment in transmission and distribution infrastructure to reduce technical losses and improve grid stability. It also encouraged the expansion of renewable energy initiatives, particularly solar and off-grid solutions designed for SMEs and rural communities where electricity access remains unreliable. In addition, the group advocated for renewed incentives that support energy-efficient manufacturing, helping producers cut costs while reducing dependence on expensive power sources.
Beyond energy sector reforms, CPPE underscored the urgent need for affordable financing across critical economic sectors. The current high-interest-rate environment, driven partly by aggressive monetary tightening aimed at controlling inflation, has made borrowing prohibitively expensive for many businesses. This has limited expansion plans, stalled new investments, and curtailed the productive capacity of agriculture and manufacturing—two sectors essential for job creation and economic stability.
To ease this burden, CPPE called for the introduction of targeted, lower-interest financing for SMEs, farmers, and manufacturers. It proposed expanding credit guarantee schemes that help de-risk lending for financial institutions, making them more willing to extend credit to small businesses. Strengthening development finance institutions to provide long-term, concessionary loans was also highlighted as a key step toward boosting output and promoting economic resilience.
The think tank’s recommendations come on the heels of new inflation data released by the National Bureau of Statistics (NBS). The NBS reported that headline inflation eased to 16.05% in October 2025, down from 18.02% recorded in September. Year-on-year, headline inflation stood at 17.82%, a major decline from the 33.88% observed in October 2024. Food inflation—which has been a major driver of household hardship—also posted a marked drop to 13.12% year-on-year, significantly lower than the 39.16% recorded a year earlier.
Despite the improved numbers, Yusuf reiterated that inflation remains high relative to household incomes and business margins, making targeted interventions essential to sustain the progress.
The Federal Government has recently amplified its consumer credit agenda as part of broader efforts to ease cost-of-living pressures. President Bola Tinubu announced in October that 153,000 Nigerians had benefited from N30 billion in loans disbursed through the National Consumer Credit Corporation (Credicorp). These loans were provided for needs ranging from vehicle purchases and solar systems to digital devices and home improvements. Tinubu also highlighted the rollout of YouthCred, a credit platform targeting young Nigerians, particularly National Youth Service Corps (NYSC) members, to support entrepreneurship and essential purchases.
Earlier in February, Credicorp launched a scheme enabling Nigerians to access loans for purchasing locally assembled vehicles—a move that aligns with the administration’s goals of promoting local manufacturing and improving mobility for low- and middle-income earners.
Still, the CPPE maintains that while government credit initiatives are commendable, a more comprehensive strategy is required. Stabilising energy costs and widening access to affordable financing, the organisation argued, will not only support SMEs—the backbone of Nigeria’s economy—but also help sustain the recent moderation in inflation and lay the groundwork for stronger, more inclusive economic growth.
