Nigeria ranks 110 when it comes to ease of doing business globally and 14th in Africa

NIGERIA has been ranked 110th out of 161 countries when it comes to ease of doing business in a recent survey by Forbes magazine that places the country 14 on the African continent behind the likes of Ghana and Senegal.

In this latest survey, the US was ranked 17th below Ireland and Finland, while top on the list is the UK, followed by Sweden in number two position, Hong Kong in number three, the Netherlands in number four, New Zealand in number five and Canada in number six. In Africa, South Africa was number one but ranked 59 globally, while Morocco was 62, Seychelles 66, Tunisia 82, Botswana 83, Rwanda 90, Kenya 93, Ghana 94, Egypt 95, Namibia 96, Senegal 100, Zambia 103 and Cape Verde 104.

One Forbes spokesman said: “We used the World Bank’s Doing Business report to grade countries’ taxes, investor protection and red tape/bureaucracy. Then, the Heritage Foundation’s Index of Economic Freedom provided the basis for our ratings on trade freedom and monetary freedoms, while ratings on technology, innovation and infrastructure came compliments of the World Economic Forum’s annual Global Competitiveness Report.

“We used the Property Rights Alliance’s International Property Rights Index to gauge property rights, which was led by Japan. The workforce was based on the size of the labour force and its growth from data via the World Bank, while the quality-of-life ratings came courtesy of the United Nations’ Human Development Index.”

Nigeria’s assessment was also based on its 203.5m population with a gross domestic product (GDP) growth of 0.8% and GDP per capita of $2,000. This year’s ranking represented an improvement for Nigeria compared with last year when the country ranked 115 out of the 153 assessed countries, then with a GDP growth of 1.6% and GDP per capita given as $2,200.

The Forbes spokesman added: “Nigeria is sub-Saharan Africa’s largest economy and relies heavily on oil as its main source of foreign exchange earnings and government revenues. Following the 2008-09 global financial crises, the banking sector was effectively recapitalised and regulation enhanced, and since then, Nigeria’s economic growth has been driven by growth in agriculture, telecommunications and services.

“Economic diversification and strong growth have not translated into a significant decline in poverty levels as over 62% of Nigeria’s over 180m people still live in extreme poverty. Despite its strong fundamentals, oil-rich Nigeria has been hobbled by inadequate power supply, lack of infrastructure, delays in the passage of legislative reforms, an inefficient property registration system, restrictive trade policies, an inconsistent regulatory environment, a slow and ineffective judicial system, unreliable dispute resolution mechanisms, insecurity and pervasive corruption.

“Regulatory constraints and security risks have limited new investment in oil and natural gas and Nigeria’s oil production had been contracting every year since 2012 until a slight rebound in 2017. President Buhari, elected in March 2015, has established a cabinet of economic ministers that includes several technocrats and he has announced plans to increase transparency, diversify the economy away from oil and improve fiscal management but has taken a primarily protectionist approach that favours domestic producers at the expense of consumers."

According to Forbes, President Buhari ran on an anti-corruption platform and has made some headway in alleviating it, such as the implementation of a Treasury Single Account that allows the government to better manage its resources and a more transparent government payroll and personnel system that eliminated duplicate and ghost workers. It added that the government is also working to develop stronger public-private partnerships for roads, agriculture and power.

“Nigeria entered recession in 2016 as a result of lower oil prices and production, exacerbated by militant attacks on oil and gas infrastructure in the Niger Delta region, coupled with detrimental economic policies, including foreign exchange restrictions. GDP growth turned positive in 2017 as oil prices recovered and output stabilised,” the Forbes report added.