Gombe Retains Top Position As Easiest State For Business – PEBEC
The Presidential Enabling Business Environment Council (PEBEC) has released the second edition of the Subnational Ease of Doing Business Report for 2023, which once again places Gombe ahead of the 36 states and the Federal Capital Territory.
Gombe, referred to as the Jewel of the Savannah, recorded a weighted score of 7.15 to emerge as the state providing the friendliest environment for business. Placed second is Jigawa State (6.79), followed in third by Sokoto State (6.88).
Since 2017, the PEBEC has been implementing reforms aimed at removing bureaucratic constraints to doing business and to make Nigeria a progressively easier place to do business.
It subsequently made a proposal to the National Economic Council to replicate the ease of doing business initiative at the subnational level, which was unanimously approved in July 2017.
Nigeria’s Subnational Ease of Doing Business (EoDB) Report was undertaken by the PEBEC to provide empirical information on the attractiveness of states’ business climates and to serve as a credible reference resource for businesses and investors.
The 2023 Subnational Ease of Doing Business Report builds on the inaugural Subnational EoDB Baseline Report released in March 2021 and improves it in several areas, including deepening of the methodology and enhancing the statistical significance of the Survey. The report provides more nuanced information on the business climate across the 36 states and the Federal Capital Territory (FCT). It highlights improvements made since the release of the last report in March 2021 and identifies the challenges that remain to be met, as well as the reforms that need to be implemented to make the business environment more conducive for businesses and investors.
The subnational survey methodology framework was developed by the Technical Working Group of PEBEC’s National Economic Council (NEC) comprising representation from six states drawn from the six geopolitical zones, the NEC Secretariat, Nigerian Governors’ Forum, the Nigerian Bureau of Statistics, the Nigerian Investment Promotion Commission, the Nigerian Export Promotion Council, the Nigerian Economic Summit Group, and other private sector representatives. The new report features six indicators – Infrastructure; Secure and Stable Environment; Transpaarency and Accessibility of Information; Regulatory Environment; Skills and Labour and Economic Opportunity. Each State has been rated on a 10-point scale across the indicators, providing the basis for calculating the 2023 weighted EoDB score for each state.
A breakdown of the report by geopolitical zones shows that Plateau State (5.8) topped the states in North Central; with Gombe State (7.15) topping the states in North East; Jigawa State (6.88) topping North West; Anambra State (6.19) first among the states in the South East; Rivers State (5.76) on top of South South; and Ekiti State (5.79) on top of South West.
The key findings from the survey include the following:
• There has been marginal improvement in the satisfaction with the ease of doing business in Nigeria from the 2021 baseline with the 2023 EoDB weighted score increasing to 5.69 (against 5.45 in the baseline)
• Infrastructure and Secure and Stable Environment are the key drivers of satisfaction both accounting for 41.1 % (22.8% and 18.3% respectively) of satisfaction
• While there is marginal variation in satisfaction across business sizes, there is noticeable dispersion in satisfaction across sectors. Businesses in Agriculture (6.21), Transportation (6.21), and Construction (6.13) have the highest satisfaction scores while those in Health (5.43), Entertainment (5.43), and Tourism (5.25) are the least satisfied.
• Satisfaction with electricity has a great correlation with the overall satisfaction with the ease of doing business. A 5 hour increase in daily power supply could result in 1.5 – 2 points increase in satisfaction.
• Implementing the right reforms and communicating these reforms to the micro, small and medium enterprises (MSMEs) is necessary to improve satisfaction. 6 out of the 11 subnational entities that implemented reforms experienced an increase in satisfaction score.
The report showed that targeted communication and continuous improvement are essential to ensuring that subnationals are successful in improving their business climates.
The survey is a dividend of the ongoing collaboration between the PEBEC and the NEC, and enables State Ease of Doing Business Council to craft their reform agendas and implementation roadmaps towards improving the business environment.
The Presidential Enabling Business Environment Council (PEBEC), of which Dr. Oduwole is the pioneer Executive Secretary, is chaired by the Vice President. The Council formulates policies aimed at supporting small and medium-sized enterprises are facilitated in collaboration with all arms and levels of government, as well as the private sector.