A recent study by the World Bank ranked Nigeria 170th for ease of doing business. This put the country only 19 places clear from the bottom of the table for the 189 countries recognised. In this position, Nigeria was even ranked lower than several war-torn countries, such as Iraq, Yemen, and Mali – and only five places higher than Syria. Nigeria has held the title as Africa’s largest economy for a year now, when it surpassed South Africa. So how can this be the case? Nigeria’s economic and business record, particularly in recent years, appears to tell a different story.
Small business are Nigeria’s lifeblood
The oil industry may comprise Nigeria’s most powerful industry, but small businesses are the main drivers of the country’s economic activity. In 2014, when Nigeria’s GDP was revised, it was the addition of small business into the official statistics that helped enable the bigger picture. The International Finance Corporation (a part of the World Bank Group) estimated that 96% of Nigeria’s businesses are small to medium enterprises (SMEs). Clearly, with a GDP exceeding half a trillion dollars, a great deal of which is due to an abundance of small business, it is clearly possible to start businesses in Nigeria.
Nigeria’s continuing construction boom
Nigeria’s capital city, Abuja, sprung from the tropical wilds in the middle of the country. Coming from almost nothing in the 1970s, Abuja is a glittering metropolis of 3 million people. And since then, the city has never stopped growing. Abuja is the beating heart of Nigeria’s dynamic construction industry and real estate market. The capital city alone accounts for 22% of the country’s entire real estate industry. The most ambitious construction project yet, Centenary City, is a state of the art development designed along the principles of Dubai, to celebrate Nigeria’s century as a united country. With a hefty $180bn price tag, the project is due for completion on 2024, and will surely set a new standard for architecture in Africa – and continue to keep Nigeria’s construction and real estate buoyant for years to come.[via Fascinating Nigeria]
Female entrepreneurship is high
The emerging world as a whole leads the way when it comes to women in business. 41% of women in Nigeria are entrepreneurs. The role of women has been a major contributing factor in the small business boom. This also shows Nigeria’s role in social advancement and female empowerment. After all, running one’s own business is a strong indicator of control over one’s life, and a stake in society.
‘Ease of doing business’ for whom?
Nigeria is not a country that is hostile to foreign businesses. One of the largest oil producers, Nigeria’s national oil company, the NNPC operates joint ventures with foreign oil companies such as Shell. The World Bank study unfortunately seems to be conducted through a western lens. In Nigeria’s business world, it is understood that foreign companies are partners with the government and other native businesses. They are not given free reign to do as they wish. This perhaps explains why some countries are ranked higher in ease of doing business. Essentially, the countries closer to the top of the table are in two categories. Either they are western countries, or they are emerging countries who are more open to (or unable to resist) having their resources utilised almost exclusively by foreign companies and states. Nigeria, Africa’s economic heart, which promotes home grown business, and treats foreign companies are partners and not superiors, doesn’t quite fit these criteria.