State governments play a critical role in regulating the business environment by issuing land permits, property registration, construction permits, enforcing contracts, and local taxation, among others directly under their purview. Micro, Small and Medium-sized Enterprises (MSME) account for 47.8% of the country’s GDP. The businesses in this category have collectively complained about their level of productivity due to the challenging business environment. As a result, the Presidential Enabling Business Environment Council (PEBEC)has developed homegrown indicators to assess the business environment of states and their level of attractiveness of states to investors through an exercise known as a national doing business survey. This initiative aims to deepen the implementation of business environment reforms at subnational level and ensure that SMEs are not hindered from doing business easily anywhere in Nigeria.
The new indicators assess four significant categories of importance to MSMEs to improve subnational initiatives affecting the business environment continually. The four categories include infrastructure, transparency and accessibility to information, regulatory environment, skills and labour. These categories form the basis of the Subnational Ease of Doing Business Survey, highlighting “What to Improve” from the responses of the MSMEs. “How to Improve” is the key focus of the Ease of Doing Business (EoDB) survey report, with the findings and analysis of the survey. The report provides a basis for comparison of results from different states. The final step, which was newly incorporated, referred to as the “Outcomes of Improvement Initiatives, ” ensures that reforms improve each state’s business environment.
PEBEC conducts this exercise annually and uses it to provide an updated perspective on subnational rankings on Ease of Doing Business in Nigeria. For instance, the 2021 Doing Business survey report captured the perceptions of the MSMEs nationwide on the business environment and existing economic realities at the state level. This exercise creates a baseline for individual States’ Ministries, Departments and Agencies (MDAs) to refine their reform agenda. While the survey highlighted key pain points faced by MSMEs, it is evident from the survey report that private sector perception has a major influence in the assessment process which makes it important for the public sector in Edo State to interact more with businesses in its environment and ensure that their challenges are alleviated. As PEBEC prepares the second edition of these reports, it would like to leverage the learnings to date and feedback from stakeholders to refine the methodology, assess progress made in different states and highlight reform priorities as the economy emerges from the effect of the COVID-19 pandemic. The ranking compares different states’ efforts in the country to make their business environment attractive to investors through its homegrown indicators.
In response, the Edo State Government recognizes the critical role of MSMEs in developing the local economy and prosperity. The government is also working on resolving business challenges by implementing business environment reforms to address the constraints affecting the private sector. To deepen the implementation of the state’s business environment reforms, the Governor has inaugurated a 15-man Business Enabling Environment Task Team to identify and proffer solutions to bottlenecks that inhibit business growth and create a conducive environment for businesses in the state. The task team are the senior reform champions in the state’s Ease of Doing Business ecosystem, whose task is to work with MDAs and other stakeholders to enable the state to gain mileage in the PEBEC national doing business ranking.
The state Ease of Doing Business Secretariat at the Edo State Investment Promotion Office (ESIPO) is working assiduously in collaboration with MDAs and various stakeholders to identify and solve the issues facing the private sector in the state. As part of its role in coordinating the business environment reforms, actionable steps are being taken such as developing a roadmap to guide the process with plans to organize public-private dialogues to resolve challenges experienced by local businesses.
A noteworthy result from the ‘Doing Business Technical Session Engagement with Stakeholders held in March highlighted several reform initiatives, including the development of a rigorous performance management system to ensure the civil service adhered to the implementation of the government reforms. At the session, the private sector representative made a case for improved cooperation between government and businesses to strengthen their collaboration on matters of mutual interest such as taxation and provision of public services.
The secretariat noted the issues raised and conducted follow-up visits to implementing MDAs to collate information on the current status of PEBEC indicators to prioritize reforms for quick wins. The interaction with implementing MDAs and other stakeholders is ongoing and more information about milestones achieved will be presented in subsequent publications.
From the Ease of Doing Business Secretariat at ESIPO.