The Lagos Chamber of Commerce and Industry (LCCI) has warned that, as of the third quarter of 2024, prohibitive financing costs are curbing investment, job creation and expansion among manufacturers and small‑medium enterprises (SMEs) across Nigeria. The chamber’s latest quarterly economic report highlights that, despite recent banking reforms, affordable credit remains scarce, and the nation’s external debt has surged to about N166.79 trillion, raising concerns over fiscal sustainability and private‑sector borrowing.
**What does the LCCI report say about credit conditions?**
- The report notes that macro‑economic stability and banking reforms are essential, yet many firms cannot secure working‑capital loans at reasonable rates or tenors.
- It stresses that the issue is not merely bank capital adequacy but the ability of viable businesses to obtain credit that supports productive investment.
- A quoted chamber statement reads: “Nigeria cannot achieve the scale of industrial growth and employment creation it needs if the cost of productive capital remains prohibitive.”
**Which institutions are urged to act?**
The chamber calls on the [Central Bank of Nigeria](https://www.cbn.gov.ng), development finance institutions and commercial banks to boost credit intermediation for the real sector, prioritising working‑capital, equipment purchase, agricultural value chains, export‑oriented manufacturing, technology adoption and SME expansion.
**How does rising public debt affect businesses?**
- The report records that Nigeria’s debt stock has risen to N166.79 trillion, intensifying worries about debt‑service burdens and the risk of crowding out private‑sector credit.
- It warns that higher government borrowing could keep interest rates elevated, increase financing costs for firms and limit affordable credit, especially for MSMEs and manufacturers.
- The chamber adds that external debt exposes public finances to exchange‑rate volatility and may restrict spending on infrastructure, power, transport and other growth‑enabling projects.
**What about energy costs and fuel prices?**
- The LCCI identifies soaring petrol and diesel prices in the third quarter as a major concern, noting that higher fuel costs raise the expense of running generators, transporting goods and delivering services.
- Regarding the government’s proposed petrol price‑stabilisation mechanism, the chamber acknowledges that a price ceiling could soften the immediate impact of global oil price and exchange‑rate shocks, but doubts it will lower fuel prices enough to give meaningful relief to businesses and consumers.
**What are the chamber’s recommendations?**
The LCCI urges monetary authorities, development finance houses and commercial banks to:
- Strengthen credit channels for the real sector.
- Focus on financing that supports working capital, equipment acquisition, agricultural value chains, export‑oriented manufacturing, technology uptake and SME growth.
- Consider the broader implications of rising public debt on credit availability and fiscal health.
By addressing these challenges, the chamber argues, Nigeria can create a more conducive environment for industrial expansion and job creation.