Beware! Read why Nigeria is one of the most dangerous places to do business
– A BMI operational risk report listed Nigeria as one of the most dangerous places to do business
– Corruption was identified as the greatest factor making business difficult
– President Buhari was applauded for his effort to rid corruption off the system
Nigeria has been regarded as one of the most difficult places to do business according to BMI’s July Operational Risk Report.
Deteriorating domestic security, terrorists’ attacks and severe fuel shortages are some of the factors that had made the country a dangerous place for business people in Sub-Saharan Africa (SSA).
According to the report: “Nigeria offers investors one of the most difficult and dangerous operating environments in sub-Saharan Africa.
READ ALSO: APC fires Ekiti lawmakers for fighting Buhari
The major risks to businesses stem from the deteriorating domestic security situation, which is characterised by rampant criminal activity and frequent terrorist attacks, along with the country’s severe fuel shortages.”
Out of 48 SSA countries that were reviewed, Nigeria placed 14th position and is behind Kenya, Ghana and South Africa and scored 37.9 percent in its Operational Risk Index
According to the report, “inherent operational risks pose dangers to the safety of foreign workers and business interests, and also cause disruption to the country’s utilities infrastructure and transport network, both of which are struggling to meet the needs of an expanding economy and population.”
“Pervasive corruption across both the public and private sector serves to further complicate bureaucratic procedures, raise legal costs and deter foreign direct investment.”
The report however identified the country’s low labour costs as a plus for investors and the availability of “a large pool of labour with increasingly diverse skills sets.”
The report also highlighted transportation as a constraint to successful business in Nigeria.
“Nigeria’s roads provide the dominant mode of overland freight transport, but supply chains face severe disruption due to poor quality and chronic congestion. Pipeline infrastructure is also poor and oil theft is common, further threatening to disrupt business operations”.
It however recognises corruption as the greatest obstacle to its widespread practice but applauded President Muhammadu Buhari for the crackdown on the menace.
“Openness to trade and investment is severely constrained by significant fiscal barriers, widespread corruption, limited intellectual property right protection, low government revenues and an underdeveloped and under-enforced legal system”.
It notes that under the present administration “there have been recent efforts to address the issue of corruption (efforts which BMI believes will continue to gain further momentum in the future); however, it will take time for the results of this anti-corruption drive to filter down to all levels of Nigerian businesses and society.”
READ ALSO: N750m car scam: Ortom lauds EFCC over arrest of lawmakers
Nigeria also scored 52 out of 100 in the area of labour.
“Nigeria has a large pool of skilled and unskilled labour relative to other countries in sub-Saharan Africa owing to its vast population, favourable demographics and the sheer number of people completing various levels of education”.
Corruption, poor infrastructure and frequent strike action were considered factors that may affect the quality of offerings at the educational level. The report says this makes businesses to retrain graduate employees or recruit foreign-trained graduates at an extra cost.
The post Beware! Read why Nigeria is one of the most dangerous places to do business appeared first on Nigeria News today & Breaking news | Nigerian newspapers 24/7.