Could the PEBEC be a Game Changer for Entrepreneurship in Nigeria?
By Stephen Oyedemi
October 25, 2017
In 2016, when the PEBEC – Presidential Enabling Business Environment Council was launched, there was little hope as to whether its ambitious mission will be achieved anytime soon. However, last week in an interview after opening the Tony Elumelu Entrepreneurship Forum in Lagos, Nigeria, the vice president claimed that the initiative had achieved 70 per cent success in its 60-day national action plan and has started the second 60-day national action plan. This initiative places a lot of emphasis on improving the ease of doing business in Nigeria by focusing on 8 reform areas which are: starting a business, construction permit, getting electricity, registering property, getting credit, paying taxes, trading across borders, and entry & exit of people.
PEBEC was set up in July 2016 by the current administration in an effort to remove bureaucratic constraints to doing business in Nigeria and make the country a progressively easier place to start and grow a business. This is justified by the fact that Nigeria currently ranks poorly in the World Bank ease of doing business ranking, holding the 169th position out of the 190 ranked countries in 2017; a one step up from the 2016 ranking where Nigeria took the 170th position.
Also, in the recently published Fraser Institute’s Economic Freedom of the World (EFW) 2017 report (which is for the year 2015), Nigeria ranks 114th out of the 159 countries with available data. However, the country was ranked 116th in the 2016 report, representing a 2 step improvement over a year. The EFW index provides a comprehensive measure of the consistency of a country’s institutions and policies with economic freedom.
These poor ranking of Nigeria clearly suggests that several things are not being done rightly in Nigeria when it comes to business and entrepreneurship. Small and Medium Enterprises (SMEs) have been described by many experts as the engine of economic growth and prosperity and that much emphasis in needed in this aspect. However, small businesses are faced with many challenges among which are access to capital, poor infrastructure, government bottlenecks, security, and so on. Difficulty in registering businesses, getting permits, etc., frustrate entrepreneurs and slows the rate at which new businesses are created.
Interestingly, the PEBEC intends to tackle these challenges through the national action plans and the executive orders released earlier this year. In July, 2017, the vice president signed 3 executive orders aimed at removing all bureaucratic bottlenecks that had stifled growth of businesses in Nigeria. While this is laudable, many of these bottlenecks still persist and the need remains for the federal government to double its efforts in order to make meaningful progress in easing the doing of business and entrepreneurship in the country.
BudgIT Fiscal Sustainability Index 2017
For Nigeria to improve its future positions in the Fraser institute’s EFW and World Bank ease of doing business rankings, there is also need for individual state governments to take decisive steps towards improving the ease of doing business in their respective states. According to BudgIT – a civic organization working to make Nigeria’s budget and public finance accessible in creative and appealing ways – in its recently published State of states 2017 report, “Significant investment is needed to improve the overall economic performance at state level…” Improvements in the ease of doing business in the states will lead to greater investments, increase in economic activities and eventually better lives for Nigerians. However, most states do not have clear economic blueprints to drive development and investments at the state level.
For the PEBEC to be a game changer for Nigeria, both the federal and state governments should endeavour to create the enabling environment for enterprise to flourish by coming up with workable blueprints with clear deadlines.
*Stephen Oyedemi is a member of SFL Africa Executive Board and Director of Activism for West Africa. He is a post-graduate student at the University of Ibadan and can be followed on twitter @SKOyedemi.
This piece solely expresses the opinion of the author(s) and not necessarily of the organization as a whole. Students For Liberty is committed to facilitating a broad dialogue for liberty, representing a variety of opinions. If you’re a student interested in presenting your perspective on this blog, click here to submit a guest post!