Some years ago, I was at the Nnamdi Azikiwe University, Awka, Anambra state, for a public lecture. An obviously popular lecturer was invited to the podium to make his contributions. Students went gaga, screaming his nickname and giving him a standing ovation. In the euphoria, he posed elegantly in front of the microphone and started making a proposal on how to tackle unemployment in Nigeria. Wait for this: he said all federal ministries should be directed to employ one million people annually for the next five years “to wipe out unemployment from the land”. The students jumped on their feet, clapped frenetically and screamed his nickname again. I laughed until I forgot my name.
Let’s not say a word on the office space required to accommodate one million new employees a year, or the wage bill, or the job description. I would rather leave that to accountants, economists and personnel managers. But how many people can the government employ in a country of 185 million people? Globally, the biggest employers of labour are not the government, Apple or Microsoft. They are the small and medium-sized enterprises (SMEs). They are recognised as the engine of any economy. The Buhari administration has developed quite a number of policies to support entrepreneurs, with a lot of emphasis on the ease of doing business.
In fact, the Presidential Enabling Business Environment Council (PEBEC), chaired by Vice-President Yemi Osinbajo, was set up in July 2016 by President Muhammadu Buhari “to remove bureaucratic constraints to doing business in Nigeria, and make the country a progressively easier place to start and grow a business”. The council comprises 10 ministers, the head of civil service of the federation, the CBN governor and representatives of Lagos and Kano state governments, the national assembly and the private sector. A lot has been achieved, no doubt, and this is evident in Nigeria’s improved ranking in World Bank’s Ease of Doing Business Index.
Osinbajo, while acting as president in May 2017, said: “The powerhouse of the economy, the fastest and most efficient job creators are private businesses – both small and large investments, local and foreign. Everyone who starts a business, invests in an existing business or expands a going concern creates opportunities for jobs. Jobs mean money in people’s pockets… whole families can survive, live well and pay taxes, so that government can continue to provide services, build schools, hospitals, roads and other infrastructure. But small or large businesses cannot be created or can be frustrated out of existence if the environment for doing business in a country is harsh or difficult.”
Good talk. Now let us discuss the enemies of progress. I quote Osinbajo again: “It is the public service that provides the services that determine whether the business environment will be friendly and welcoming for business or whether it will drive away business and destroy opportunities for job creation… So, when a potential business owner wants to register a company, collect tax clearance certificate or obtain NAFDAC registration or SON certification, expatriate quotas, any other papers, approvals or certification from government and we do not willingly and efficiently help him or her, we are killing the jobs and prosperity that he would have created.”
Exactly. And this is what I intend to discuss today. The business I run falls under the SME category, with a staff strength of 20. Compared to other lines of business, however, I have little to complain about in terms of the shenanigans of government agencies — apart from the over-auditing by the inland revenue service. A friend told me that the constant “tax audit” is because we remit taxes regularly. Those who don’t bother about paying taxes are hardly bothered by the tax authorities, he said. What an incentive! I am honestly OK with the audits; when I listen to other SME owners complain about all the stress they go through, I realise I am enjoying life!
Two years ago, I wanted to go into table water production. I spent quite a lot of money on feasibility studies. One thing I kept hearing was the constant troubles from government agencies under the general guise of regulation. I was told that if I wanted to site the factory in Lagos state, I would have to deal with regular harassment from these agencies: National Agency for Food and Drug Administration and Control (NAFDAC), Standards Organisation of Nigeria (SON), Lagos State Water Regulatory Commission (LSWRC), Lagos State Environmental Protection Agency (LASEPA), Lagos State Ministry of Environment and Lagos State Ministry of Health.
I’m not done yet. Other agencies waiting to pounce are: Lagos State Fire Service, Federal Fire Service, Local Government Environment Service, Local Government Health Department, Local Government Fumigation Department, Local Government Food Department and the health office nearest to the factory. SON, meanwhile, will inspect four times a year. Ministry of Health inspects at least twice a year. Ministry of Environment visits two times a year. By the way, all these inspections often come with extortion. There is nothing wrong with regulation — we have to enforce standards — but you and I know that the least interest of these guys is health and safety.
Needless to say I was discouraged from going ahead with the water business. I lost possible income — and I probably would have created at least 50 jobs. That is loss of revenue for government as well. You can accuse me of chickening out. You can remind me that despite all these challenges, many Nigerians are still opening new businesses and making it. I have no intention of arguing against that, just that the threshold for stress differs from individual to individual. When a matter puts me completely at the mercy of the regulatory authorities — as represented by their sadistic field agents — I am not cut out for such a life. And I can imagine there are thousands of Nigerians like me.
My friend owns a bakery in Abuja. She regularly complains to me about the stress she faces from all manner of government officials who come to the bakery everyday from all manner of agencies. It is nothing short of harassment, intimidation and extortion. It is terrorism. One day I sat down with her and asked her to list all the fees she pays, all the agencies she deals with and all the threats she faces all the time. I walked away feeling so sad but still thankful that the business is nonetheless thriving — in spite of the enormous odds mounted by the government. It is as if government is doing everything within its power to kill SMEs. The determination is unmistakable.
The Nigeria Social Insurance Trust Fund (NSTIF) had just notified her of another “health inspection”. She was horrified. At least three units from the Abuja Municipal Council Area (AMAC) do “health inspection” every year. Two of the units charge N25,000 each while the third takes N50,000. NAFDAC, NSTIF and SON all coming for “health inspection”! One agency can do all the health checks, trust me. There is a N25,000 annual licence for “operating in FCT”. She pays N34,000 fee for “using a car to distribute bread”. She pays Federal Housing Authority (FHA) and AMAC N40,000 each for “fumigation”. It’s a major racket — the agencies MUST supply the fumigators!

https://www.thisdaylive.com/index.php/2018/08/19/killing-small-businesses-softly/amp/

Precisely because this is a thoughtful article on the bureaucratic obstacles that choke the growth of the smaller businesses which need to thrive for Nigeria to grow, the Nairaland masses will pass it by unread, in favor of the usual "Yoruba vs Igbo" slugging matches everybody on here seems to love. As I will never tire of pointing out, Nigeria is a sh*thole country run by pieces of sh*t "leaders" because the great majority of Nigerians are intellectually lazy tribalists with weak moral fiber, despite all the religious posturing they love to indulge in for public consumption.

I have plans 2 start sumtng similar bt wit dis write up am already discouraged God help dis country

Its a pathetic situation. I used to wonder why Nigeria s education system is considered substandard till a graduate once told me that the government is not doing its job of hiring all Nigerians. I could not believe what I heard , when I realized the guy talking was an economic graduate, that even made me lose faith in Nigeria's educational system .

omohayek:
Precisely because this is a thoughtful article on the bureaucratic obstacles that choke the growth of the smaller businesses which need to thrive for Nigeria to grow, the Nairaland masses will pass it by unread, in favor of the usual "Yoruba vs Igbo" slugging matches everybody on here seems to love. As I will never tire of pointing out, Nigeria is a sh*thole country run by pieces of sh*t "leaders" because the great majority of Nigerians are intellectually lazy tribalists with weak moral fiber, despite all the religious posturing they love to indulge in for public consumption.

Simeon Kolawole raised a very powerful issue; VP Osibanjo is trying with easy of doing business; but the Truth is lots need to be done physically. Various Government at every level are killing business initiatives as it stand today.

Nigeria is a nuisance

There is no business in Nigeria that is free from these extortions. Is it private transporters, schools, kiosks etc. The truth is you have to have the mind of a thief to operate a business in Nigeria. There are ways to boycott some of these taxes but it defies morality and its damn illegal. You just have to cross ur mind and start.

lalasticlala Acting President Osinbajo must see this!

I have always said it. Nigerian govt agencies only know how to pay lip service using empty rhetoric, when it comes to supporting SMEs. The govt is known for launching outlandish schemes with fanfare, which they claim would benefit SMEs. At the end of the day, very few of those SMEs record any benefit from such schemes, and the few that do so, either have long legs or godfathers that most of the others, do not have.

Simon Kolawole even tried to enumerate the number of different levies inflicted on various businesses, by different arms of govt. He should come to Lagos, and see. Those levies can be raised to the power of 5, as different charges come up in every district, from different govt agencies. Don't forget Land Use Charge, o. It is still part of the cost that a landlord passes down to his commercial tenants.

There was another thread launched a few months ago, about the stress that SMEs face, in trying to get access to loans from the Bank of Industry (BOI). Even after the SMEs have complied with all the paperwork, getting the bank officials to inspect the premises of the business, is a herculean task. And after the unfathomable delays encountered from the bank officials, the applications of SME firms then elapse, as it is only valid for a short period. Tell me now, na who be mumu?

Nigeria na country?

There is no easy of doing business in Nigeria yet; we have more of propaganda.

Nigeria is one of the most difficult places to do business

hardywaltz:
Nigeria is one of the most difficult places to do business

Touts and constituted authority will not allow you to rest because there are so many ambiquities in collecting relevants documents that are done online stress free in most parts of the world

We keep searching for foreign investment without addressing the major issues that discourage interest in same.

We want substantial growth in SMEs but we're not prepared to create an enabling environment especially for younger people who have very little take off grant.

We complicate issues for those who struggle to thrive against all odds. The reality is that it's not just about the government, it's about the people. Those who schedule regular 'health checks' for the purpose of extortion are citizens like us.

We need to do a rethink and work diligently for a better business environment.

Netanyahu1:
Its a pathetic situation. I used to wonder why Nigeria s education system is considered substandard till a graduate once told me that the government is not doing its job of hiring all Nigerians. I could not believe what I heard , when I realized the guy talking was an economic graduate, that even made me lose fate in Nigeria's educational system .

Big lie

delpee:
We keep searching for foreign investment without addressing the major issues that discourage interest in same.

We want substantial growth in SMEs but we're not prepared to create an enabling environment especially for younger people who have very little take off grant.

We complicate issues for those who struggle to thrive against all odds. The reality is that it's not just about the government, it's about the people. Those who schedule regular 'health checks' for the purpose of extortion are citizens like us.

We need to do a rethink and work diligently for a better business environment.

That is the truth. You want to build a bungalow na wahala and yet we shout housing for all,
yet we make it tiresome to build and own.
Seun

These Agencies with different price tags will choke both your capital and profit in the name of working for government.
example:
Shop tenement yearly Lagos State,
LGA lockup shoe levy - yearly (imagine)
Security levy
Union levy
LGA development due yearly
+

If your business is inside a Market, levies like:
Environmental levy weekly (environmental cleanup still done by yourself every Thursday; failure to clean = locked shop / fine)
market development levy monthly
Iyaloja upkeep monthly (500 X the number of rented shops in the market)
You want to renovate the shop(rented / owned) e.g the roof needs changing - 10k
or stop work
The LGA wants to fix the drainage or build fence/gate for the market, you will be levied as little as 1k - 5k
Iyaloja wants to do sallah, her daughter wants to marry etc 2k upward per shop
You bring your paid goods to the market, you settle touts in charge of the market, if not you can't offload.

Places like Trade Fair are mind bogging because
You pay to bring in your containers,
Your customer pays to take the bought goods out of it, even when he used a private car, if the touts in front of that police station notice it, you must pay

After all these various corrupted and unnecessary practises, how much will be the cost of goods?
If the cost is too high - low patronage - bad
If unchanged - low profit / cutting corners in quality of goods - bad

delpee:
We keep searching for foreign investment without addressing the major issues that discourage interest in same.

We want substantial growth in SMEs but we're not prepared to create an enabling environment especially for younger people who have very little take off grant.

We complicate issues for those who struggle to thrive against all odds. The reality is that it's not just about the government, it's about the people. Those who schedule regular 'health checks' for the purpose of extortion are citizens like us.

We need to do a rethink and work diligently for a better business environment.

if you know how much some of these agencies like son, nafdac make you part money anytime they come visiting or refusing / delaying to perform their duties...
I know how some industries pay their levys and are of high standard when it comes to Quality Control but if you don't settle these agencies minus their dues, they will delay or keep your file/inspection pending after you have being given the directive by them to start production.

Ximonak:


if you know how much some of these agencies like son, nafdac make you part money anytime they come visiting or refusing / delaying to perform their duties...
I know how some industries pay their levys and are of high standard when it comes to Quality Control but if you don't settle these agencies minus their dues, they will delay or keep your file/inspection pending after you have being given the directive by them to start production.

You are not lieing, lot of human bottle necks....

Netanyahu1:
Its a pathetic situation. I used to wonder why Nigeria s education system is considered substandard till a graduate once told me that the government is not doing its job of hiring all Nigerians. I could not believe what I heard , when I realized the guy talking was an economic graduate, that even made me lose fate in Nigeria's educational system .

This government spends average of N1.6m per graduate and is expectated to employ everyone. The mess doesn't stop there. When finally employed they go on to constitute the bottleneck the OP is about. It is sad. People think life owes them everything. They think man is still in garden of eden where needs were met supernaturally.

Omooba77:
There is no easy of doing business in Nigeria yet; we have more of propaganda.

https://www.nairaland.com/4692852/nnpc-suppose-building-power-plants#70543803

Another problem we have.

Omooba77:


Touts and constituted authority will not allow you to rest because there are so many ambiguities in collecting relevant documents that are done online stress free in most parts of the world

Bro the gov can easily fight these corrupt practices with the use of Internet. All we have to do is upload the relevant documents and pay online then wait for approval or manual verification if need be but because it will be a fix fee and eliminate bribery, it will not be done.
Imagine immigration, custom, son, nafdac, police, LGA fines/levy being online, fixed amount + the government gets the revenue directly but we are told it can't be done while banks, telecoms, e-commerce are all working, even jamb and NYSC has joined online integration

Nigeria gov is not ready to diversify from OIL handout yet...
so no proactive business friendly policies / implementation yet.

Ximonak:


Bro the gov can easily fight these corrupt practices with the use of Internet. All we have to do is upload the relevant documents and pay online then wait for approval or manual verification if need be but because it will be a fix fee and eliminate bribery, it will not be done.
Imagine immigration, custom, son, nafdac, police, LGA fines/levy being online, fixed amount + the government gets the revenue directly but we are told it can't be done while banks, telecoms, e-commerce are all working, even jamb and NYSC has joined online integration

Nigeria gov is not ready to diversify from OIL handout yet...
so no proactive business friendly policies / implementation yet.

If we can use technology via internet and postal services.

delpee:
We keep searching for foreign investment without addressing the major issues that discourage interest in same.

We want substantial growth in SMEs but we're not prepared to create an enabling environment especially for younger people who have very little take off grant.

We complicate issues for those who struggle to thrive against all odds. The reality is that it's not just about the government, it's about the people. Those who schedule regular 'health checks' for the purpose of extortion are citizens like us.

We need to do a rethink and work diligently for a better business environment.

Guy, you have said it all, and you have said it well! Doing business in Nigeria is tiring, frustrating and money-consuming, with endless tales of extortion at different levels.

Local govt will come to your office/shop, the minute you open it, to ask for sanitation levy, but they will never provide any sanitation services to your neighbourhood. Even their agents will ask for radio/TV license, as if they bought you the LED screen in your office. If you have a petrol station, DPR will harass you each time you want to renew your license. State govt agencies will troop in, as if you are minting money in your backyard, with one claim or the other. They do not want to know if you are breaking even, or not.

In my estate, several buildings have been converted to shops. But guess what? After paying the 1st year's rent, these shop owners move out and the building is left empty for another few months, because the businesses were closed down due to low patronage and high govt taxes.

In China, the local govt is in charge of encouraging MSMEs and shop owners to stay in business, so if a shop owner is struggling to keep his business afloat, he is affiliated to a bigger firm, so that he can get support and re-organise his business to ensure it thrives. In fact, local govts in China, are graded based on how many businesses they attract to their districts and allow to thrive, because that is where their revenue comes from. In Nigeria, the govt agencies want to kill your business before it even takes off!

LaudableXX:

Guy, you have said it all, and you have said it well! Doing business in Nigeria is tiring, frustrating and money-consuming, with endless tales of extortion at different levels.

Local govt will come to your office/shop, the minute you open to ask for sanitation levey, but they will never provide any sanitation services to your neighbourhood. Even their agents will ask for radio/TV license, as if they bought you the LED screen in your office. If you have a petrol station, DPR will harass you each time you want to renew your license. State govt agencies will troop in, as if you are minting money in your backyard, with one claim or the other. They do not want to know if you are breaking even or not.

In my estate, several building have been converted to shops. But guess what? After paying the 1st year's rent, these shop owners move out and the building is left empty for another few months, because the businesses closed down due to low patronage and high govt taxes.

In China, the local govt is in charge of encouraging MSMEs and shop owners to stay in business, so if a shop owner os struggling to keep his business afloat, he is affiliated to a bigger firm, so that he can get support and re-organise his business to ensure it thrives. In fact, local govts in China, are graded based on how many businesses they attract to their districts, and allow to thrive, because that is where their revenue comes from. In Nigeria, the govt agencies want to kill your business before it even takes off!

They know we are docile..
See how quickly Ambode covered some of the potholes because of Theresa omo May.