Small and medium sized enterprises stand to benefit from the recently launched 60-day National Action Plan by the Presidential Enabling Business Environment Council (PEBEC). This group contributed c.50% to Nigeria’s national output in 2016. The ministries, departments and agencies (MDA) are tasked with implementing the plan but participation from other stakeholders such as specific state governments, the National Assembly and the private sector is also required if the plan is to have any realistic chance of succeeding. Nigeria is currently ranked 169 out of 190 in the ease of doing business index by the World Bank.
There are eight focus areas within the plan; ‘starting a business’ features at the top. Based on the World Bank’s most recent survey, Abuja, Zamfara, Kebbi, Lagos and Ogun emerged as the five leading states with regards to ease of starting a new business.
Generally, in Nigeria, the procedure for start-ups is cumbersome. When compared with developed economies, there are at least two times as many steps required. The action plan aims to reduce the number of days required to register a business from ten days to 2. The Corporate Affairs Council will drive this by adopting a more electronic approach.
In addition, obtaining construction permits proves to be difficult in Kaduna, Abuja, Lagos and Anambra. Nonetheless, these state still record a high level of construction activities. The action plan aims to reduce this process from forty two days to 20.
Usually applicants are unclear about which rules, fees, and procedures apply. The PEBEC hopes to address this by ensuring fees predictability during applications and transparency of planning permit assessment.
With respect to property registration, there is a high level of discord. The time required for a state governor’s consent delays the process considerably. Using e-signatures instead is currently being considered and the council aims to reduce the property registration duration from seventy seven days to 30.
Trading across borders is not very encouraging in Nigeria as well. We gather that the FGN has considered reducing the number of agencies operating at the air and sea ports to ease the process of clearing goods to within 24 or 48 hours. This should promote growth and stimulate pan-African trade.
Business travel into Nigeria can be challenging due to the long visa on arrival and submission processes as well as the poor conditions at the airports. The council has now harmonised the entry and exit forms at the airports.
Additionally, authorities at the airports have been mandated to install the iCheck Security Solution Technology, which should phase out these entry and exit forms in the medium to long term.
We commend the FGN’s efforts made so far. However, we note that plans on eliminating major bottlenecks such as better access to credit and power shortages have not been clearly articulated.