The World Bank Group (World Bank) on Thursday, 24 October 2019, published its 2020 Doing Business Report (the Report). This latest report sees Nigeria ranking 131 out of 190 countries on the ease of doing business index, an upward movement by 15 places from 2019 ranking of 146.
Based on the Report, Nigeria improved in eight indicators, with the greatest overall positive movement being on dealing with construction permits. Nigeria moved from 149 to 55 within a year, indicating that it is now easier to build warehouses, factories, etc. (including obtaining the necessary licenses and permits) in Nigeria than 135 other countries in the world.
The significantly improved ranking in dealing with construction permits may be attributable to the elimination of the Infrastructure Development Charge (IDC – the fee for construction permits) for warehouses and factories.
The table below shows the summary of movement in Nigeria’s rankings in the last one year:
Also, there are other reforms related to getting electricity, registering property, trading across borders and enforcing contracts whose impacts have been positively acknowledged by the World Bank.
Overall, the ease of doing business in Nigeria improved by 15 positions, with Nigeria now ranked 131st globally and 34th in Africa. This is an improvement on the country’s 146th position in the 2019 Doing Business Report. Based on the 2020 Report, in addition to the reasons highlighted above, the improvement in the rankings can be traced to the easier process of registering a business online, as well as the improved registration for land administration as a result of the implementation of the geographic information system.
Notwithstanding the improvements in most of the indices covered in the Report, Nigeria recorded downward movements on the ease of paying taxes. This is despite the introduction and implementation of the Integrated Tax Administration System (ITAS) which was and is still expected to simplify the process of filing and paying taxes. In recent times, there has been a lot of complaints from taxpayers on the difficulties and challenges in filing and making tax payments on the platform, including intermittent downtime of the system. Nigeria’s 35th position in Africa on the ease of paying taxes implies that the Federal Government needs to focus on improving the ITAS system to achieve efficiency.
Given this upward movement in the overall ease of doing business ranking, there is no doubt that the government is making efforts to improve the business environment and investor confidence, which will automatically attract more investors into the country. This notwithstanding, efforts must be intensified towards improving indices with unfavourable rankings.