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Business News

Ease of doing business index: Experts highlight impediments  

Experts have highlighted multiplicity of taxes, poor infrastructure, poor power supply and weak transportation system as impediments to doing business in Nigeria, a development they said was responsible for Nigeria’s poor rating on Ease of Doing Business.

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Ease of doing business index: Experts hightlight impediments  

Experts have highlighted multiplicity of taxes, poor infrastructure, poor power supply and weak transportation system as impediments to doing business in Nigeria, a development they said was responsible for Nigeria’s poor rating on Ease of Doing Business 

A finance and tax expert, Dr Peter Adebayo, who spoke to Nairametrics in an interview, explained that businesses still encountered challenges with power and most recently at the ports where poor infrastructure and access roads had put a great deal of burden on the cost of clearing and haulage. 

Adebayo expressed concerns that for a sector generating a great deal of income for the nation with the potential to earn more, the government did not display urgency in fixing ports infrastructure.  

“Nigeria Customs Service can double its revenue if the ports perform at optimum performance without such the bottlenecks and if that happens, several businesses will heave a sigh of relief and also make more money.” 

[READ MORE: 5 habits of Nigeria’s business billionaires you should emulate]

On multiplicity of taxes, the fellow of the Institute of Chartered Accountant explained that while tax is the lifeblood of any economy, it is also important that it should not become a burden to businesses as such development would further pull the rating of the country in the Ease of Doing Business index. 

“The federal, state and local governments are expected to harmonise taxes because taxes are meant to ensure entrepreneurs remain in business by providing basic infrastructure to ease production and not to frustrate them with same or similar taxes at different levels.” 

The former Managing Director, Asset Management Corporation of Nigeria (AMCON), Mustafa Chike-Obi, said, “I expect the federal and state governments to create an office under the Vice President where business owners can lodge their complaints on any bottlenecks they face in the course of doing business in Nigeria because that will boost the confidence of investors in the country.” 

Meanwhile, the Nigerian Investment Promotion Commission announced on Thursday that Nigeria ranks 146 out of 190 countries on the Ease of Doing Business index across the world. 

The Executive Secretary of the CommissionMs Yewande Sadikuwho disclosed this in Lagos on Thursday, said the ranking was carried out by the World Bank. 

According to the report, Nigeria’s Ease of Doing Business scores improved by 1.37 points from 51.52 Distance to Frontier (DTF) in 2018 to 52.89 in 2019. 

She added that the Commission had adopted some proactive strategies geared towards improving Nigeria’s Investment Promotion, thereby helping to create ease in doing business in Nigeria. 

Sadiku said, “The Proactive Investment Promotion strategies include focusing on key strategic partners and countries, identifying high impact sectors, better balance investors’ rights with obligations, improving investor experience and using feedback to develop the business environment. 

“Others are: proactively inviting target companies to Nigeria and hand-holding them through the decision making and the implementation process, and encouraging more Nigerians to invest in the country. 

“We encourage states to develop investment promotion agencies so that they will be specifically charged with the responsibility of promoting the states.’’ 

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[READ ALSO: Manufacturing Index shows 11 ‘performing’ businesses in Nigeria]

Sadiku, however, cautioned investors to ensure that they abide by the relevant investment laws in the nation. 

She urged government to enable investors so they can create more jobs that will have a significant impact on the economy. 

 

Abiola has spent about 14 years in journalism. His career has covered some top local print media like TELL Magazine, Broad Street Journal, The Point Newspaper.The Bloomberg MEI alumni has interviewed some of the most influential figures of the IMF, G-20 Summit, Pre-G20 Central Bank Governors and Finance Ministers, Critical Communication World Conference.The multiple award winner is variously trained in business and markets journalism at Lagos Business School, and Pan-Atlantic University. You may contact him via email - [email protected]

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    Economy & Politics

    Top States in Nigeria with highest IGR per population in 2020

    Nairametrics ranks the 36 states of the Federation, including the Federal Capital Territory, based on their IGR per population.

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    Nigeria’s states generated a sum of N1.31 trillion internally in 2020, representing a marginal decline compared to N1.33 trillion recorded in 2019, and an increase compared to N1.17 trillion in 2018.  

    The downturn is attributable to reduced state revenue as a result of disruptions caused by the covid-induced lockdown, while the crash in crude oil prices also hampered economic growth. 

    Internally generated revenue is regarded as income generated by various states in the country, independent of their share of revenue from the Federation account. However, apart from the clear exception of Lagos State, all others depend largely on statutory allocations to run their state affairs. 

    Nairametrics ranks the 36 states of the Federation, including the Federal Capital Territory, based on their IGR per population, taking into account the estimated population size of each state as at 2016 and 5% growth rate between 2016 and 2020.  

    Geo-political zones 

    In terms of IGR per population for the six geo-political zones in Nigeria, South West takes the lead with an average of N13,966, having generated a sum of N561.01 billion and an estimated population of 40.17 million people. The South-South region followed with an average of N8,694 and a total aggregate IGR of N263.17 billion.  

    On the flip side, the North-Eastern region, which houses states like Bauchi, Borno, Yobe, etc. recorded the lowest IGR per population of N2,061 closely followed by North West with an average of N2,855. 

    Here are the top 5 states with the highest IGR per population in 2020. 

    Lagos State – N31,794 

    Lagos State, regarded as the economic hub of the nation, with a total estimated population of 13.18 million people as of 2020generated a sum of N418.99 billion as IGR in 2020. This represents an increase of 5.1% compared to N398.73 billion recorded in 2019. 

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    • In terms of IGR per capita, Lagos State generated an average of N31,794 from each member of the population in 2020, as against N30,257 generated in the previous year. 
    • It is no surprise that Lagos State tops the rank, being a major epicentre for economic activities in the country. Lagos State is the largest city in Africa in terms of GDP, and the State is widely known for its large industries, with most corporations in the country headquartered within the state. 
    • It also houses major seaports in the country as well as the State Government’s aggressive taxation policies. These, amongst others, ensure the state makes more revenue internally compared to other states of the Federation. 
    • According to data obtained from the National Bureau of Statistics, Lagos State received a total of N115.93 billion as Federal allocation in the year 2020, representing 21.67% of the total revenue available to the state in the year. 
    • This shows the exceptional ability of the state to run its affairs, using its internally generated revenue with little or no support from the Federal purse. 

    Abuja – N24,600 

    The Federal Capital Territory generated a sum of N92.06 billion in 2020, the third-highest state IGR in the year. However, based on IGR per population Abuja seats in second position with an average of N24,600. 

    • This represents a 23.5% increase when compared to N19,925 recorded in 2019. 
    • Abuja is the capital territory of Nigeria, with a total estimated population of 3.74 million people across a 7,315km square area. 
    • The state houses a lot of Federal ministries, having been made the country’s capital in 1991. Abuja is also a major conference centre in the country, as it hosts various meetings and summits annually. 
    • A cursory look at the data showed that the state’s IGR only accounted for 57.85% of the total available revenue, indicating that 42.15% of its revenue was gotten from the Federation account. 

    Rivers State – N15,281 

    Rivers State, being a major oil-producing state in the country, generated a sum of N117.19 billion as internally generated revenue in 2020. 

    • However, with an estimated population of 7.7 million people, its IGR per population stood at N15,281 in 2020, representing a decline of 16.5% when compared to N18,307 recorded in 2019. 
    • Rivers State is in the Niger Delta region of the country with much of the businesses in the state being oil exploration companies. 
    • Evident from the data obtained from the NBS, Rivers State relies heavily on statutory allocations from the Federal Government as well as their share of the 13% oil derivatives as it received a total of N141.19 billion from FAAC, representing 54.64% of the total available revenue in the review period. 

    Delta State – N10,045 

    Delta state, another state in the Niger Delta region of the country, with an estimated population of 5.9 million, generated a sum of N59.73 billion as IGR, and an average of N10,045 as IGR per population. 

    • Delta State is a major oil-producing state and ranks second to Rivers State. The State supplies about 35% of Nigeria’s crude oil and some considerable amount of natural gas. 
    • Delta State in the period received a sum of N186.83 billion as statutory allocation. 
    • Its IGR only accounted for 24.2% of the available revenue in the period, while N46.11 billion was generated as PAYE. 

    Ogun State – N9,263 

    Ogun State, a neighbouring State of Lagos State, generated a sum of N50.75 billion. In terms of IGR per population, the State generated a sum of N9,263. 

    • The State’s average income per population decreased by 28.4% compared to N12,945 recorded in 2019. 
    •  The State is strategically located, bordered to the East by Ondo State, to the North by Oyo and Osun States, to the South by Lagos State and the Atlantic Ocean, and to the West by the Republic of Benin. 
    • Ogun State also joins the list of states that are much dependent on FAAC allocations as statutory payments stood at N37.7 billion, representing 42.61% of the total revenue. 

    Bottom five 

    Katsina – N1,386 

    Jigawa – N1,416 

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    Benue – N1,736 

    Niger – N1,804 

    Bauchi – N1,821 

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    Coronavirus

    Covid-19: FCT to end vaccination May 14

    The FCT Primary Health Care Board (FPHCB) announced it would end the first round of Covid-19 vaccination on the 14th of May.

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    The FCT Primary Health Care Board (FPHCB) announced it would end the first round of Covid-19 vaccination on the 14th of May.

    This was disclosed by Mrs Salome Tor, Programme Officer, FPHCB in a meeting with newsmen on Friday.

    She disclosed that the FCT received 248,400 doses of vaccine and has successfully vaccinated  96,559 as of May 6, 2021, thanks to a team of 169 health workers.

    “We have a minimum of three health workers in each team, they have all been distributed into the six area council. All the government hospitals in the FCT are selected locations for this vaccination.

    “We also have temporary fixed post team; these are special teams who visit various organisations or special location. We urge people to go and vaccinate before the exercise closes,” she said.

    The FPHCB added that Nigerians still need to get vaccinated and urged for the media’s participation in spreading awareness of the vaccination drive.

    “We need at least seven out of 10 people to be vaccinated to be able to withstand the SARS 2 virus of COVID-19. I consider that as a deliberate hazard that will become hazardous to the community, so we advise that people shouldn’t put themselves in that position, they should go ahead and take the vaccine.

    “We started this vaccination in FCT on March 15, the country at large started it on March 5, we have not seen anybody who complains of the vaccine in FCT, maybe blood clot or death.

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    “Why are people waiting, they should go ahead and take this vaccine in the health facility within the 62 wards of the FCT, the vaccine is safe,” the healthcare board said.

    What you should know

    The National Primary Health Care Development Agency announced that as of May 7, 2021, it had vaccinated 1,615,787 residents, which is 80.3% of its proportion.

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