Energy Costs Consume 60% of SMEs' Profits in Nigeria

Femi Egbesola, president of the Association of Small Business Owners, has reported that energy costs are now consuming 60% of profits for small and medium enterprises (SMEs) across Nigeria. This is a significant increase from the previous 40%.

The rising costs of fuel and electricity are forcing many businesses to operate below capacity, with some even shutting down. Egbesola highlighted that the current energy expenses are unsustainable, particularly as businesses rely heavily on generators due to inadequate public power supply.

He urged the government to consider temporary subsidies for diesel and alternative energy sources to mitigate job losses and business closures. The rise in energy costs is eroding Nigeria's global competitiveness, leading to higher product costs and increased prices for goods.

Egbesola called for measures such as providing compressed natural gas (CNG) vehicles, supporting renewable energy adoption, and offering tax waivers to encourage investment in alternative power sources.