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Subnational Data

Doing Business in Nigeria 2014

Author: Subnational Doing Business
Published: September 29, 2014

Overview

Doing Business in Nigeria 2014—the third subnational report of the Doing Business series in Nigeria— compares business regulations in 35 states and Abuja, FCT. The report focuses on federal and state regulations that affect 4 stages in the life of a small to medium-size domestic firm: starting a business, dealing with construction permits, registering property, and enforcing contracts. The report finds that 22 states improved in at least one of the benchmarked areas, making it easier for local entrepreneurs to start and operate a business. The report also compares gender-specific employment data from the main public agencies in charge of administering the benchmarked areas: land registries, building authorities and Corporate Affairs Commission branches in each state.

Where is it easier to do business in Nigeria?

Main Findings

  • This year’s report recorded 34 improvements, of which 13 focused on starting a business, 8 on dealing with construction permits, 10 on registering property, and 3 on enforcing contracts.
  • The states of Cross River, Ekiti, Niger, Ogun, and Rivers made the biggest strides towards the national frontier of good practices.
  • While most reform efforts focused on reducing the complexity and cost of regulatory processes—including improvements in internal processes of federal and state agencies—several states also focused on longer-term judicial reforms to strengthen the legal institutions for contract enforcement.
  • Despite improvements, challenges persist: no single state ranks at the top in all the areas measured.
  • Sharing local good practices and coordinating better between federal and state governments are critical to improving the business environment for all Nigerians.
  • For the first time, the Doing Business in Nigeria series recorded reforms that make it easier to start a business: 13 states introduced reforms improving the internal processes of federal or state agencies, such as the Corporate Affairs Commission and state ministries of commerce.
  • Less burdensome requirements and faster approvals of construction permits, like in Adamawa and Jigawa, would make Nigeria one of the best performers in this area, more efficient than the OECD average of 13 procedures and 147 days.
  • Uneven implementation of federal legislation and differences in state fees drive the large variation in the cost to register property—from 7.7% of the property value in Yobe to 26.4% in Edo.
  • Katsina remains the easiest place to enforce a contract within Nigeria: resolving a standardized commercial dispute takes 314 days and 41 procedures and costs 26% of the claim value.