▪Abia, Edo, Delta, Taraba, Zamfara place 33rd, 34th, 35th, 36th, 37th respectively as not promising for businesses
Despite its potential, Nigeria’s commercial capital, Lagos is not the most business-friendly state in the country; rather, Gombe, Sokoto and Jigawa are, according to new report on the ease of doing business in states across Nigeria.
Published by the Presidential Enabling Business Environment Council (PEBEC), set up in 2016 by President Muhammadu Buhari to remove critical bottlenecks and bureaucratic constraints to doing business in Nigeria, the new “states ease of doing business survey” also indicated that Abia, Edo, Zamfara, Taraba, and Delta have the most unfriendly atmospheres for businesses in the country.
The survey measured how the 36 states in Nigeria and the FCT have supported businesses with enabling infrastructure – electrity, security, primary health care, and transportation; transparency and access to information – investment promotion and states information structure; as well as regulatory environment – paying tax, starting a business, enforcing contracts, land and property acquisition and registration.
Also measured in the survey were skills and labour, that is, the level of technical and professional labour available and accessible in states.
From its analysis, the PEBEC report indicated that the top three states had average scores of 7.69, 6.88, and 6.79 respectively.
Next to the three top business-friendly states were Akwa Ibom and Bauchi – both tied at the fourth position with an overal average score of 6.54. Kebbi (6.49), Anambra (6.35) and Katsina (6.14) were the other states within the top 10 in the survey.
The country’s federal capital city, Abuja, placed 17th on the list with an overall average score of 5.51. It had a poor showing (3.39) in regulatory environment which included land acquisition and registration.
Lagos was placed on the 20th position with an overall average score of 5.28, having polled a score of 3.71 in infrastructure, 6.49 in transparency, 3.62 in regulatory environment, and 7.30 in skills and labour. Ogun, its neighbour which often feed off its potential, was placed 19th.
Joining Zamfara (3.54), Taraba (3.91), and Delta (4.32) on the bottom of the pyramid are Edo (4.38) and Abia (4.48) who were placed 34 and 33 respectively.
“The report captures the different business environment realities across the country, backed up by success stories of SMEs from all regions, to encourage peer learning and review, healthy competition and provide guidance for investors,” Dr Jumoke Oduwole who is the Secretary of PEBEC said.
Oduwole who doubles as Buhari’s adviser on ease of doing business, also stated that, “It is expected that the report of the survey will serve as an information resource document for businesses and investors at home and abroad.”
According to the report, 998 Small and Medium Enterprises (SMEs) across the country were surveyed; 157 in the North-west, 85 in the North-east, 180 in the North-central, 314 in the South-west, 128 in the South-east and 134 in the South-south.
It stated that its main findings showed that “provision of electricity is a major pain point for businesses,” and that “only two states provide an average of 10 or more hours of electricity per day,” to businesses in the country.
According to it, “disruptionof business activities by state agents is widespread, with only two states reporting the absence of disruption by state agencies.”
The report also explained that there is low trust in the ability of public security agents to prevent or resolve security incidents in the states, while investment-friendly and funding strategies are not common in 26 states including the federal capital territory.
It highlighted that the regulatory environment in Nigeria is perceived to be generally unfavourable for businesses, adding that tax policies are still unclearer with multiple taxation.
“There are also opportunities to improve the turnaround time of judicial processes and processes related to property acquisition and talent development,” the report added.
The PEBEC noted that the methodology used in the survey and report was developed in partnership with the Nigerian Governor’s Forum (NGF), the Nigerian Bureau of Statistics (NBS), the Nigerian Investment Promotion Commission (NIPC), the Nigerian Export Promotion Council (NEPC), and the Nigerian Economic Summit Group (NESG), while empirical field survey was conducted by KPMG Professional Services between November 2020and January 2021.
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