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Nigerian businesses rank “unclear economic laws” as top business constraints

Companies also expect the Naira to appreciate in the current month, next month and next twelve months.

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Chinese debt trap, Nigerian Economy: Solution To Fixing Buharinomics

Lates Business Expectation survey of the CBN reveals companies in Nigeria have ranked “unclear economic laws” as one of the most vicious constraints to business operations in the country. This is only next to the lack of adequate power supply and interest rates, which recorded the highest negative sentiments from respondents.

Survey Summary 

  • Respondents’ outlook on the volume of total order, business activity and financial
    conditions (working capital) were positive during the review period.
  • Firms identified insufficient power supply, high-interest rate, financial problems, unfavourable economic climate, unclear economic laws and unfavourable political climate as major factors constraining business activity.
  • Respondent firms expect the Naira to appreciate in the current month, next month and next twelve months.
  • Level of inflation is expected to increase slightly in both the next six months and the next twelve months; borrowing is expected to rise in the current month, next month and the next twelve months.

In the report cited by Nairametrics, respondents are optimistic about an economic turnaround in 2020 however they still list out the following as major constraints to business survival in Nigeria, Africa’s largest economy.

[READ ALSO: Despite Power constraints, Nigeria’s industrial sector shows growth prospect(Opens in a new browser tab)]

Respondent firms identified insufficient power supply (66.3 points), high-interest rate (57.8 points), financial problems (55.0 points), unfavourable economic climate (53.8 points), unclear economic laws (50.4 points), unfavourable political climate (45.3 points), insufficient demand (45.0 points), competition (44.7 points) and access to credit (42.5 points) as major factors constraining business activity in the current month

What this means: While the government continues to mention the ease of doing business as central to its economic policy, Nigerian business still face major challenges with the rising cost, haphazard regulations and multiple taxations. Power, high-interest rates and an unfavourable economic climate have been the bane of businesses for decades. However, “unclear economic laws” is a feature largely symptomatic of Buharinomics.

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The Business Expectation Survey can be downloaded on the website of the CBN.

 

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Chike Olisah is a graduate of accountancy with over 15 years working experience in the financial service sector. He has worked in research and marketing departments of three top commercial banks. Chike is a senior member of the Nairametrics Editorial Team. You may contact him via his email- [email protected]

1 Comment

1 Comment

  1. on_looker

    December 10, 2019 at 11:07 am

    finance bill (the highlights) will fix the major part of it, then something has to be done to CAC in a similar fashion.

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Business

FG to facilitate removal of tax on minimum wage, as NLC suspends strike

The FG has stated that it will work to facilitate the removal of tax on minimum wage.

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The Nigerian Government says it is working to facilitate the removal of tax on minimum wage and also agreed to work with labour unions in the housing and gas schemes as the Nigerian Labour Congress (NLC) and the Trade Union Congress (TUC)  suspended the planned nationwide strike after a consultative meeting with the FG.

This was announced in a statement by the Nigerian government on Monday morning, following meetings held between FG and Labour unions on the 15th, 24th and 27th of September.

Nairametrics reported earlier the NLC and the Trade Union Congress (TUC) have suspended the planned nationwide strike and protest that was to commence on Monday, September 28, 2020, over the recent hike in electricity tariff and petrol pump price.

In the agreement between the Federal Government and organized labour, the hike in electricity tariff is to be suspended for a period of 2 weeks, while the new pump price of petrol is to remain unchanged.

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FG and Labour agreed to set up a technical committee on Electricity Tariff reforms. The terms of reference for the technical committee include;

  • To examine the justification for the new policy on cost-reflective electricity tariff adjustments.
  • To look at the different Electricity Distribution Companies (DISCOs) and their different electricity vis-à-vis NERC order and mandate.
  • Examine and advice government on the issues that have hindered the deployment of the 6 million meters.
  • To look into the NERC act under review with a view to expanding its representation to include organized labour.

In the recent statement, the FG said, “We will ensure delivery of 1 million CNG/LPG Autogas Conversion Kits, Storage Skids and Dispensing Units under the Nigeria Gas Expansion Programme, by December 2021. A Governance Structure for this project will be established, and will include Labour Representatives. FG will work to facilitate removal of tax on minimum wage… Ongoing FG Housing Initiatives will have 10 percent allocated to Nigerian workers.”

The FG also announced that it will provide Labour with 133 LPG-driven Mass Transit Buses immediately, which would be used in cities across the nation and would be extended to all LGAs before December 2021.

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Corporate Press Releases

Baba Bajaj: Runs faster, lasts longer, covers 5500 kms on tough Nigerian roads

The rally took up the challenge of proving how credible the product and also engaged the stories of the riders.

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For the first time ever, Nigeria experienced its own keke rally that kicked off on 7th August from the Stallion Auto Keke – Ijesha Showroom for Bajaj Kekes. The Stallion Bajaj Keke Rally has now completed a tough terrain of 5594 kms through 27 cities and 18 states in the West, East and North Central in less than 41 days. It consisted of a team of 5 experienced riders and the Stallion Bajaj officials and security agents. Collectively the convoy covered more than 26000 Kms without any product issues.

Managing Director for the business, Mr. Manish Rohtagi stated that “The Keke Rally really boasts on how the New Baba Bajaj is tough, strong, reliable, and well equipped for the Nigerian roads. Having covered almost more than 5000 kms the Kekes did not face any performance or maintenance challenges. It kept its brand promise of “Runs Faster, Lasts Longer” through every rider who was a part of this rally.”

 

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The rally was flagged off from Lagos and covered states like Ogun, Oyo, Kwara, Kogi, Benue, Enugu, Ebonyi, Cross River, Akwa Ibom, Abia, Rivers, Anambra, Delta, Edo, Ondo, Ekiti, Osun, to prove the durability of  Bajaj Keke. It even spread the message of urging people of Nigeria to be responsible in maintaining hygiene to curb the spread of Corona Virus. The Stallion Bajaj Keke Rally visited celebrated cultural and historic sites in each state highlighting and sharing the Nigerian culture of host communities. The journey to these sites brought forth the stories around it to encourage connecting the youth to their rich heritage.

The vision from this rally was not only to take up the challenge of proving how credible the product is but also engaging in the stories of these riders that will go on to make the brand what it is. The alliance of Stallion and Bajaj will continue to improve lives by going an extra mile providing rider-training facilities, scholarship programmes, mechanic empowerment programmes, ease in financing, ease of spare part availability and differentiated customer service through its existing footprints within the auto industry.

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Bajaj Auto Ltd. is a world leader in the intra city vehicle space. Loved in 70 countries the brand stands for integrity, dedication, resourcefulness, and determination to succeed and empower. It is a well-known brand for its durability, speed and manuverability and is the pioneer brand of tricycles in Nigeria loved by millions. It’s a keke for the people engineered for a smooth journey and better livelihood.

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Business

After 22 years, NBS is set to commence National Business Sample Census

The National Business Sample Census is expected to commence on October 12 2020, and end on December 12 2020.

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Dr Yemi Kale, National Bureau of Statistics, NBS, Federation Account Allocation Committee, FAAC

The National Bureau of Statistics, with the support of the World Bank, has commenced the process of implementing the 2020 National Business Sample Census (NBSC) in Nigeria. This is exactly two decades and two years after the last business census of establishments in the country.

This disclosure was stated in a circular signed by Ichedi, Sunday Joel, Head, Public Affairs & International Relations Unit, which was released by the Statistician-General of the Federation this morning.

The Survey which is coming after a similar one conducted twenty-two years ago (1997/98) is necessary, especially now that the current government is re-structuring the economy for faster growth through support to Small, Medium and large-scale enterprises, in order to increase their productivity.

The National Business Sample Census is expected to last two months from October 12 to December 12.

The main objectives of NBSC includes:

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• To compile, frame, and develop instruments and concepts, establish standards and methodology for industrial and business surveys in Nigeria.
• To serve as a benchmark for updates of subsequent commercial and industrial sector statistics.
• To develop a national directory of commercial and industrial business establishments, with all their associated social and economic characteristics
• To provide the country with comprehensive and detailed information about the structure of the Nigerian economy.

The Census will cover all the thirty-six (36) states of the Federation and FCT, with establishments in all economic sectors involved in the exercise.

For the avoidance of doubt, the establishments to be covered should have a fixed structure and location, a separate shop with a different entrance, and enclosed from dwelling place (in the case of residential areas), shops should have locks and keys for a market setting. While kiosks and shops under the umbrella are not to be listed during the census.

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All commercial and industrial businesses in each LGA will be identified and listed by the state. Name, location address, postal address, phone number, email address, year of commencement, number of activities engaged in, main type of activity, and others are questions that will be asked.

NBS enumerators with customized T-Shirts and Face Caps will visit your establishment, at any date within the stipulated period, to collect necessary information for the census. Please oblige them with the information, as your cooperation is germane towards the successful execution of the census exercise.

However, the Bureau wishes to assure you that any information given will be kept in absolute confidentiality, and will not be divulged to a third party.

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