Business can be stressful in Nigeria. The definition of stress and how it can impact the way you handle and work through your day-to-day tasks is a big topic of discussion. Any company with an office in any part of the city will be exposed to all kinds of stress. The major concern is that there are no laws regulating environmental control or the quality of services rendered by your business premises. You cannot help but feel at sea when dealing with matters regarding the premises and services provided and the standards required for your business growth in Nigeria. Nigerian business is stressful because of many factors, the first and foremost is that there’s not a good sense of direction within Nigeria. Nigeria is essentially a nation of people who know what they want, but it’s very hard for them to achieve their vision.
Ease of Doing business (EODB), according to the World Bank, is the measure and ranking of countries by the distance to the frontier, which is the best performance achieved by any country on each of the 10 topic indicators since 2005. The rankings are determined by sorting the aggregate scores on 10 topics, each consisting of several indicators, giving equal weight to each topic. The ease of doing business index ranks economies from 1 – 190, with first place being the best. A high ranking on the ease of doing business index means that the regulatory environment is more conducive to the starting and operation of a local firm. Nigeria is not doing very well in the ease of doing business, even as an economic powerhouse in Africa. Its economy is the biggest on the continent with a nominal GDP of $500 billion as of 2018. That is nearly five times bigger than South Africa which is the second biggest economy on the continent. Nigeria is ranked 30th in the world for its market size. The country has more than 34 million Small and Medium Enterprises (SMEs) and about 37 percent of Nigerians are employed by these businesses.
Entrepreneurs must register the property as a necessary step towards commercialization in Nigeria. It entails a series of procedures including paying stamp duty, executing a deed, or paying subdivision fees and land survey fees. In Nigeria, it takes a lot of procedures and time to register property; although the costs are minimal compared to other countries in Africa. There are many profitable business opportunities in Nigeria. Getting electricity for entrepreneurs in Nigeria is quite difficult because it is an expensive and difficult process that takes about 12% longer duration than in most countries in Africa. Hence, most entrepreneurs rely on diesel generators for production activities in the country. As employees, we know that if we feel stressed out, our productivity drops significantly. Stress-related illness is one of the top three causes of sick days in the workplace.
Nigeria’s credit system is ranked low due to a lack of secured interest registry; collateral registry; and credit bureau coverage as well as an inefficient legal framework for insolvency recovery and the absence of out-of-court reorganization proceedings regulation.
I’ll provide a more in depth analysis, a bit more personal, in my next blog post about doing business in Nigeria. Until then, ciao.