The Centre for the Promotion of Private Enterprise (CPPE) has said that the social outcomes of economic reforms has continued to weigh on households. Insisting that that is why, despite improving fundamentals, disinflation and the easing prices of some food items and manufactured products, the cost-of-living crisis remains a concern.

CPPE in a policy brief on the third quarter 2025 gross domestic product (GDP), released on Monday by the National Bureau of Statistics (NBS), said the 3.98 per cent GDP growth in Q3 2025 shows the economy remains firmly on a path of steady recovery and consolidation.

The document, signed by the Chief Executive Officer of CPPE, Dr. Muda Yusuf, said it is now 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.

The Q3 2015 GDP figures released by the NBS saw the non-oil sector sustaining its dominance of the economy, contributing 96.56 per cent driven mainly by agriculture.

CPPE said the Q3 performance highlights the positive impact of ongoing economic reforms, especially in stabilising the exchange rate, moderating inflation, improving fiscal conditions, and gradually restoring investor confidence. “These macroeconomic gains have strengthened business sentiment and supported activity across key sectors of the economy,” it said.

It said the sustained recovery recorded in Q3 is largely supported by greater exchange rate stability resulting from FX market reforms, decelerating inflation and improved investor confidence.

“These developments demonstrate that the government’s reform programme is beginning to generate tangible and measurable outcomes across the economy,” the centre said.

Looking at the sectors and their performance, CPPE observed that the services sector maintained its position as the largest contributor to GDP, accounting for 53 per cent of total output. It noted that the continued resilience of the sector, supported by digital adoption, financial services expansion, and improved business confidence, remains central to overall economic performance. Agriculture grew by 3.79 per cent, up from 2.82 per cent 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,” it noted. It described the performance of the manufacturing sector as one of the weakest performances across major sectors even though it expanded by 1.25 per cent. It attributed the problem of the sector to persistent high energy and logistics costs; costly borrowing conditions; dependence on imported industrial inputs; as well as smuggling of competing products. It noted that these structural weaknesses continue to erode competitiveness and limit job creation. The ICT sector grew by 5.78 per cent, slightly below its Q2 growth of 6.6 per cent. “The real estate posted an exceptional 89 per cent 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, ” CPPE noted.

CPPE identified the financial services as the best-performing major economic sector, expanding by 19.63 per cent, up from 6.13 per cent in Q2. “This reflects increased economic activity, stronger fiscal operations across all levels of government, and rising confidence in the financial system,” it noted.

To consolidate the gains recorded in Q3 and unlock stronger, more inclusive growth, the Centre recommends that government should reduce structural bottleneck by addressing energy supply constraints, reduce logistics costs, improve port efficiency, and accelerate transport infrastructure development.

The government should also mitigate the cost-of-living crisis; strengthen agricultural productivity; rebuild manufacturing competitiveness; address housing affordability; increase funding for social sectors; and enhance non-oil export competitiveness as well as stabilise oil output and secure critical infrastructure.

CPPE said Nigeria’s Q3 GDP performance reaffirms that the economy is on a gradual but steady recovery path.

“However, achieving higher, more inclusive, and sustainable growth will require tackling long-standing structural constraints, especially in agriculture, manufacturing, and trade,” it said.

“Targeted policies to ease cost-of-living pressures are crucial to making the reform process inclusive. With continued reforms, targeted investments, and strengthened governance, Nigeria is well-positioned to deliver stronger economic outcomes in the months ahead.