Nigeria moves to 145th in Ease of Doing Business Index

On Tuesday the 31st October 2017, the World Bank released its annual report for the ease of doing business in 189 countries surveyed. The International Bank for reconstruction & development, typically charged with the task for eliminating poverty in developing nations, says in its “Doing Business 2018, reforming to create Jobs” Nigeria moved 24 spots from 169 in 2016/2017 to 145th position. Nigeria, Djibouti, Malawi, El Salvador, Thailand, Zambia, Brunei, Kosovo, Uzbekistan implemented 53 reforms in ten (10) areas, ”

“These economies together, implemented 53 business regulation reforms across 10 of the areas measured by doing business. Overall, the 10 top improvers implemented the most regulatory reforms in the area of getting credit, starting a business, dealing with construction permits and paying taxes,” The Annual report published on the ease of doing business, that typically shows the readiness of a nation to attract foreign direct investment and increase business confidence focuses on:
  • Starting a business
  • Dealing with construction permits
  • Getting electricity
  • Registering property
  • Getting credit
  • Protecting investors
  • Paying taxes
  • Trading across borders
  • Enforcing contracts
  • Resolving insolvency

Nigeria moved eight (8) spots from 138th to 130th in registering a business, it moved twenty seven (27) spots from 174th to 147th in terms of getting a construction permit, it moved eight (8) spots from 180th to 172nd position in getting electricity, it moved three (3) spots in registering a property, the report shows that Nigeria made the most leap in getting access to credit by moving twenty six (26) spots from 32nd to 6th position, it moved eleven spots from 182nd to 171st position in collecting taxes, and forty three (43) spots in enforcing contracts moving from 139th to 96th position.

However the report shows that the country moved backward in resolving insolvency dropping five (5) spots from 140th to 145th position.

The World Bank Group says 83 business reforms were carried out in Sub Saharan African compared to 80 for the previous year. The Bank says “The Sub-Saharan Africa region continues to struggle in the area of getting electricity. On average, obtaining an electricity connection takes 115 days in the region, compared to the global average of 92 days. “The reform effort in Sub-Saharan Africa is singularly worth celebrating, as the region is beset with myriad crises, including conflict and violence. We hope to continue recording the region’s successes in enabling entrepreneurship to address the challenge of job creation, particularly for the region’s millions of young women and men.” This is some cheering news for the Presidential Enabling Business Environment Council (PEBEC) set up by the incumbent administration in 2016 with the mission to remove bureaucratic constraints to doing business in Nigeria and make the country a progressively easier place to start and grow a business.

National Collateral Registry Bill & Credit Bureau services bill which were priority bills has being front and center in the successes recorded with the access to credit for businesses. Nigeria is Africa’s largest economy with a population of 170m people, forecasted to grow by as much as 140% to 390m by the year 2035 by the United Nations Food & Population Agency.

Kelvin Emmanuel

About Kelvin Emmanuel

The Oil producing Angola in the Southern part of Africa faces what Nigeria faced 12months ago; a distortion in its exchange rate with a difference between the official markets and the parallel black markets. One dollar through the official window buys you 166 kwanza, while one dollar through the black market buys you 400 kwanza. Nigeria faced the same challenge 12months ago, when the distortion between the official and black markets was as much as the official markets trading at 306 with the parallel market ranging from 450 through to 510. The Central Bank Governor of Angola, Jose de Massano Junior announced in Luanda “We will stop having a fixed foreign exchange, we will adopt a floating regime of foreign exchange”. Angola faces exactly the same challenges and has been applying the exact same responses to an exchange rate crisis like using its foreign reserves that was sitting at $26bn to defend the currency kwanza, with no success so far, even though the external reserves has dropped to $14bn. Angola relies on Oil receipts for 80% of its government revenue, 90% of its inflow and 50% of its GDP. Angola is a $194bn economy that has been growing at an average of 10% on the back of rising oil prices since 2002 when its 27 year old civil war that started in 1975 ended. The state national oil company Sonangol reports that it produces up to 1.8m barrels of crude oil daily, however the government that until now has being led by the family dynasty Jose Eduardo dos Santos until recently when succession saw power transferred to Joao Lourenco, reports that the oil price rout in 2015/2016 that saw prices drop to as low as $28 per barrel caused ripples across the economic structures of the government, upsetting government revenues, its ability to fund its budget, capital project funding, foreign direct investments into the economy as a result of a currency crisis that was driven by the widening of gap between the official and street window of the kwanza, that until now has been pegged in a fixed exchange rate regime to the US Dollar.