Beyond the rhetoric of ‘ease of doing business’ in Nigeria

For the past few decades in Nigeria, phrases like “providing enabling environment”, and “ease of doing business” have become cliché due to the general realisation that government cannot turnaround and prosper the economy without the active participation of the private sector. Government’s role is to provide infrastructure and make policies that enable private sector players to invest and grow the economy but it has paid lip service to this responsibility over the years, until the economy plunged into abyss. The need to grow and diversify the nation’s economy has become an emergency.

There is a thin line between “providing enabling environment” and “ease of doing business”. Both involve the summation of activities and policies of government towards facilitating/catalysing economic activities in a country. While “providing enabling environment” could, among other things, involve the provision of infrastructure and policies that enable businesses flourish, “ease of doing business”, on the other hand, involves a set of government regulations and actions that allows for easy set-up of business. They aim to get rid of anti-progress red tapes and bottlenecks that bedevil the system. I must also add that these bottlenecks have been the bread and butter of corrupt government officials and they serve to only extort and frustrate intending investors.

President Muhammadu Buhari’s Democracy Day broadcast is yet another reminder of the government’s numerous unfulfilled promises and an acknowledgement of this hydra of a problem that continues to work against our economic growth.

Read Also: Nigeria business environment still unconducive – LCCI

Politicians are aware that the challenges of enabling environment and ease of doing business are the most pressing issues on the mind of the average Nigerian business person, so every campaign season they promise to bring lasting solutions but only as campaign gimmicks. The sooner they get elected into office, priorities change and nothing is done to check or improve the system. It is therefore, no surprise that this situation has gotten worse with successive governments. Though we point fingers at politicians in top government positions as chief culprits, it is important that I point out that responsibility here cuts across policy/decision-makers at the very top and civil servants down to the lowest level. In a few exceptional cases, good policies and actions have been taken at the top level but are thwarted at the lower level. I will get back to this in a bit.

The emergence of social media has given greater voice and presence to advocacy groups and critics that now pressure the government to act on burning issues of general interest. Peer review reports by International organisations like the World Bank have also added pressure to governments of countries that are lagging behind to do something to improve their situations. The World Bank currently ranks Nigeria 131st out of 190 economies that were studied https://www.doingbusiness.org/en/rankings.

Recent government policies suggest a gradual response to cumulative pressure by critics and of worsening economic indications. The policy of process automation in some ministries and parastatals is one of the positive responses by the government aimed at removing the unnecessary bottlenecks and stemming corruption. Places where processes have been automated include; Corporate Affairs Commission (CAC), Federal Inland Revenue Service (FIRS), National Identity Management Commission (NIMC), Department of Petroleum Resources (DPR) to mention a few. However, the activities of operators in these agencies conflict with the very aim of this policy and can be best described as sabotage. So, you do not need to look far to see why we are in this state of “all action, no movement”.

Having worked for many years as an administrator in the organised private sector, I am one of those that applauded this government for coming up with the automation policy because I know from experience how effective it can be to control risks with technology. I was so excited and I thought that we’re finally making real progress with improving the turnaround time for business transactions, ridding the system of extortion, establishing auditable trails for tracking government revenue, and a long list of benefits. It was a rude shock to realise that rather than sanitising the system and making progress, operators have only been armed to up their game (greater extortion).

A friend once told me of a case where an investor seeking regulatory approval to start a new business was required to provide a Tax Clearance Certificate (TCC) as part of his application. Through his auditor, he made the necessary payments and submitted his application via the FIRS portal. The statutory standard for issuing TCC is two (2) weeks from the date of application but it took about 3 months to process for the mere reason that the network was down. It is hard for me to believe that the server of the FIRS network that is supposed to be government’s primary source of revenue would be down for that long without repair, but he later realised that not all applicants suffered this fate and that network comes and goes with tips.

You can imagine the frustration of this investor when he realised that in the process of waiting for his TCC to be issued, one of the other documents in his application just expired and he had to go back to these extortionists for a renewal. Valuable time and money are lost, just as his confidence in the system.

If you think the above was an isolated case, think again. At the NIMC, they are also using the same excuse of the network to extort between N1,000 – N2,000 from desperate applicants who need their temporary card to open a bank account or to pursue other businesses that require the National ID. In some cases, there has been a complete bypass of the system and processes are still pretty much manual. The DPR website has clear instructions as to how requests can be processed online. It even has specified turnaround time for each transaction but the process still feels pretty much manual. The story goes on and on and on.

When undertaking revolutionary projects that seek to correct societal ills of such endemic nature, regular evaluation along the line of established key performance indicators is an indispensable piece. There has to be credible and effective feedback and redress mechanisms. Drivers cannot afford to stand aloof. Old habits they say die-hard, so unless there is very close monitoring, operators will naturally want to stay with their old ways, more so, when it brings a little extra into their pocket.

Who is responsible for monitoring the progress/impact of these policies and how effective are the feedback mechanisms? So, hearing President Muhammadu Buhari during his Democracy Day broadcast assuring Nigerians that anyone found guilty of corruption in his administration would be eased out quickly; I couldn’t help the feeling of ‘same old, same old’. However, as the saying goes, the next best time to start is now!

Agbo is the CEO at Unigas Global Energy Limited and a certified accountant. He is a graduate of Economics with over 20 years of experience in the financial services sector. He served at management level with notable indigenous private sector institutions like GTBank and the American University of Nigeria before joining Unigas. He can be reached via his email: anthonyaagbo@gmail.com