FRI DEC 05 2025-theGBJournal| The Centre for the Promotion of Private Enterprise (CPPE) has warned that the cost-of-living crisis remains a concern, despite Nigeria’s latest Gross Domestic Product (GDP) report for the third quarter of 2025 which indicates that the economy grew by 3.98 percent in real terms.
”While disinflation is underway and prices of some food items and manufactured products are easing, the social outcomes of economic reforms continue to weigh on households,” the CPPE adds in their Nigeria’s Third Quarter GDP Report.
While offering insights into ways to easing the burden, the private think-tank said it is therefore, imperative for policymaking to prioritise targeted interventions to address the uneasiness around the cost of living and ensure that GDP Growth and macroeconomic stability translate into real improvements in citizens’ welfare—particularly for vulnerable groups.
”Achieving higher, more inclusive, and sustainable growth will require tackling long-standing structural constraints—especially in agriculture, manufacturing, and trade.
Targeted policies to ease cost-of-living pressures are crucial to making the reform process inclusive.”
The CPPE argues that with continued reforms, targeted investments, and strengthened governance, Nigeria is well-positioned to deliver stronger economic outcomes in the months ahead.
The sustained recovery recorded in Q3 is largely supported by greater exchange rate stability resulting from FX market reforms, decelerating inflation, easing cost pressures on households and businesses and, improved investor confidence, reinforcing growth in financial services, ICT, construction, and other segments of the services sector.
The services sector maintained its position as the largest contributor to GDP, accounting for 53 percent of total output. Its continued resilience—supported by digital adoption, financial services expansion, and improved business confidence—remains central to overall economic performance.
Agriculture grew by 3.79 percent, up from 2.82 percent in Q2. Despite this modest improvement, insecurity in farming communities, weak rural logistics, limited mechanisation, and declining purchasing power continue to constrain full-scale recovery.
Manufacturing expanded by 1.25 percent, one of the weakest performances across major sectors, with persistent challenges such as high energy and logistics costs; costly borrowing conditions; dependence on imported industrial inputs and Smuggling of competing products.
”These structural weaknesses continue to erode competitiveness and limit job creation,” the CPPE said.
To consolidate the gains recorded in Q3 and unlock stronger, more inclusive growth, the CPPE recommends following policy interventions which it said are critical:
-Reduce Structural Bottlenecks
Address energy supply constraints, reduce logistics costs, improve port efficiency, and accelerate transport infrastructure development.
-Mitigate the Cost-of-Living Crisis
Implement targeted social interventions and remove structural impediments that elevate consumer prices. All tiers of government [local, state and federal] must sustain targeted interventions in agriculture, pharmaceuticals, transportation and energy to fix the cost of living crisis.
-Strengthen Agricultural Productivity
Improve security in farming regions, expand irrigation and storage facilities, invest in rural road networks, and support mechanisation.
-Rebuild Manufacturing Competitiveness
Expand access to concessionary credit, curb smuggling, reduce import duties on industrial inputs, ease logistics challenges and address supply chain pressures.
-Address Housing Affordability
Reform land administration, deepen mortgage markets, and scale up affordable housing initiatives.
-Increase Funding for Social Sectors
Prioritise investments in education and health, strengthen partnerships with private sector players, and enhance governance of service delivery systems.
-Enhance Non-Oil Export Competitiveness
Support exporters with reduced financing and production costs, and strengthen export logistics, certification, and standards.
-Stabilise Oil Output and Secure Critical Infrastructure
Improve security in oil-producing regions, curb vandalism and theft, and incentivise new investments in upstream and gas-based industries.
Meanwhile, the ICT sector grew by 5.78 percent, slightly below its Q2 growth of 6.6 percent. Nonetheless, the sector remains one of the economy’s strongest performers, driven by rapid digitalisation, e-commerce expansion, and increased technology adoption by households and businesses.
Real estate posted an exceptional 89 percent nominal GDP growth, fuelled by rising property values and asset revaluation. While favourable for investors in the sector, this trend intensifies housing affordability challenges, especially in major cities. Land administration reforms and affordable housing initiatives have become urgent.
Financial services emerged as the best-performing major economic sector, expanding by 19.63 percent, up from 6.13 percent in Q2. This reflects increased economic activity, stronger fiscal operations across all levels of government, and rising confidence in the financial system.
The trade sector grew by 1.98 percent, up from 1.29 percent in Q2. High import costs, weak consumer demand, and ongoing import-substitution measures continue to constrain growth. Nevertheless, Nigeria has recorded consistent trade surpluses, bolstering the balance of payments.
Education and health grew by 2.51 percent and 2.89 percent, respectively. These modest gains reflect under-investment, underscoring the need for expanded public spending and stronger governance across social services.
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