Nigeria loses over N200 billion annually to difficult business environment, says financial analyst

The losses are mainly associated with bottlenecks faced by entrepreneurs in starting businesses.

Nigeria’s difficult business environment is costing the country losses of more than N200 billion annually, a financial analyst, Fidelis Odita, has said.

The losses are said to be mainly associated with bottlenecks experienced by prospective entrepreneurs in getting their businesses registered and the negative practices that hinder the smooth operation of existing businesses.

Other factors contributing to the losses, Mr. Odita said, include dearth of infrastructure, poor energy supply, lack of access to small and medium-scale businesses to funds at affordable rates and the long business start-up time.

He said the Federal Government should work harder to ensure a follow-up system on the policies formulated for small and medium enterprises, SMEs, to further enhance their growth.

The SMEs provide employment for about 80 per cent of the nation`s work force, while multinational companies, government, and private concerns accounted for only 20 per cent Odita said.

“I think if the government were to get its acts together and take steps to address policies aimed at building capacity for SMEs, it could very easily boost the economy by up to 30 to 40 per cent,” Mr. Osita said. “It is not only about having Bank of Industry, BOI, or Nigerian Export Import, NEXIM, Bank.

“There are many regulatory bottlenecks, which create huge operating costs for these businesses. I know of cases where people have applied for consent to the Federal Government for over twelve months they haven’t heard anything. So, if you wanted to set up a small business here and you haven’t been able to get consent, it means that there has been a twelve months delay.

“And during that time, you might have hired people, and you would now have to lay off some of them, because no one budgeted that you will stay for twelve months waiting for one person just to say I consent, go ahead with your business. I would say that Nigeria would be losing N200 billion annually from these regulatory bottlenecks and the attendant consequences,” Mr. Odita said.