What Hope, As World Bank Sets To Rank Nigerian States On Ease Of Doing Business?

Nigeria’s desperate attempt to climb out of its woeful position (169 out of 189) in the global ranking of Ease of Doing Business may receive a life-line as the World Bank sets to rank Nigerian States.

Indications to this effect were revealed in a recent press release credited to the Minister of Industry, Trade and Investment, Dr Okechukwu Enelamah, in which he said that Nigeria’s 36 states and the Federal Capital Territory (FCT) will be ranked by the World Bank in its Subnational Rankings based on ease of doing business metrics for the period of 2014-2018.

The report noted that he made this disclosure during his joint presentation with the Secretary to the Presidential Enabling Business Environment Council (PEBEC), Dr. Jumoke Oduwole, to the National Economic Council (NEC), chaired by Acting President Yemi Osinbajo, with members comprising the 36 state governors, the Governor of the Central Bank of Nigeria (CBN), as well as other officials with economy-related portfolios.

The states will be ranked based on eleven key indicators including four standard World Bank indicators and additional seven indicators drawn from specific areas of interest within the targeted reform agenda of states.

The four World Bank indicators are, Starting a Business, Enforcing Contract, Registering Property and Dealing with Construction Permits, while the additional seven indicators include, Trade/Investment & Marketing, Infrastructure, Access to Land Property, Regulatory Environment, Institutional support & business resources, Transparency & accessibility to Information and Security.

This evaluation process across states which has already begun will be followed by the release of the report and rankings in the first half of 2018.

It is expected that, as is consistent with subnational rankings, the report will provide valuable data on local peculiarities, shared attributes, as well as replicable reforms.

It will be recalled that as Nigeria battled with a contracted economy and flirted with recession owing largely to the crash of the price of oil in the international market, the Buhari administration had, as part of its stated effort to revive the economy, emphasized the need to broaden investment access into the Nigerian economy. This was also against the backdrop of Nigeria’s woeful position of 169 out of 189 countries in the ease of doing business rankings.

Consequently, in July of 2016, President Buhari established the Presidential Enabling Business Environment Council (PEBEC) chaired by Acting President Osinbajo, to pursue the removal of regulatory constraints to doing business in Nigeria.

Also, in May of this year, Acting President Osinbajo signed three executive orders on ease of doing business in Nigeria bordering on important issues namely, promotion of transparency and efficiency, timely submission of annual budgetary estimates by all statutory and non-statutory agencies, and support for local contents in public procurement by the Federal Government.

Overall, ease of doing business reform efforts have been mostly notably restricted to the national level. State efforts, to the extent that they exist, do not enjoy much visibility, even though many experts believe that the state level is where such reforms should be even more prioritized given the federal structure of the country and state’s desperate need for investments owing to their economic travails.

Even though the ranking of states will not be the first in Nigeria by the World Bank having undertaken such in 2008, 2010, and 2014 respectively, the 2018 Nigerian subnational rankings will arguably be anticipated with greater interest.

It is coming at a time when many Nigerian states are struggling to cope with the financial obligations of administration under a recession, and are desperately in need of opportunities to expand their revenue base way beyond federal allocations.

This report will provide useful insights on key impediments to this aspiration, as well as lay out a clear strategy to easing business activities and accessing substantial investments as a result.

In the meantime, given the stakes, state governments are expected to review past reports on ease of doing business in their various states, and begin in earnest to institutionalize reforms that will set their states on the path to sustainable economic development leading to economic self-sufficiency.

How much reforms by the Federal Government have impacted on the economy still remain a matter of conjectures as paucity of data make accurate projections almost impossible.