According to the recently published World Bank Doing Business Report 2016, running a business in Nigeria is still a very daunting task. Beginning, running and growing a business under the current investment climate remains difficult for small and medium scale investors, reveals the World Bank report.
The report which surveys a total of 189 countries is the World Banks effort to aggregate and monitor the economic indices that influence the growth of businesses across the globe. These indices include; the ease of accessing electricity, ease of registering a property, ease of accessing credit facilities, protecting minority investors, amongst others. The infrastructure deficit across Africa obviously hampers business in Nigeria and other sub Saharan countries who also ranked very low according to the report.
Nigeria moved from 170th position with 43.56 per cent points in 2015 to 169 with 44.69 per cent points presently. The rankings also revealed that getting electricity became more difficult in 2016, as the country fell in ranking from 181st position to 182nd, while registering property improved by four places from 185th to 181st, and getting credit is becoming tougher with a seven place drop in ranking from 52nd ranking to 59th.
Highest ranked African Countries for ease of doing business
COUNTRY GLOBAL RANKING
South Africa 73
Commenting on issues regarding doing business in Nigeria, the World Bank said the country’s poor track record as regards the standard of building construction and regulation has an adverse effect on business in Nigeria. The report read:
“Where informal construction is rampant, the public can suffer. Take the case of Nigeria, which lacks an approved building code setting the standards for construction.
“Without clear rules, enforcing even basic standards is a daunting task, and many buildings fail to comply with proper safety standards. Structural incidents have multiplied. “According to the Nigerian Institute of Building, 84 buildings collapsed in the past 20 years, killing more than 400 people.”
Among the 189 countries surveyed, Singapore ranked as the easiest destination for doing business, followed by New Zealand, Hong Kong SAR, China, Denmark, Korea Republic,Norway, The United States, The United Kingdom, Finland and Australia, in that order.
World Bank Chief Economist and Senior Vice President, Kaushik Basur said that although businesses cannot be left to run without regulation by government, businesses shouldn’t be grounded and left to suffer as a result of cumbersome regulations. He said:
“The challenge of development is to tread this narrow path by identifying regulations that are good and necessary, and shunning ones that thwart creativity and hamper the functioning of small and medium enterprises.”