By Mson Ijoho
OVERVIEW:
Nigeria, Africa’s most populous country and one of its largest economies, is grappling with severe economic and entrepreneurial challenges. Despite its vast resources and potential, the nation faces high levels of economic hardship, policy failures, and infrastructural deficiencies that impede business growth and economic stability. As the country navigates these difficulties, it is clear that a multifaceted approach is needed to address both immediate concerns and long-term structural issues.
THE STATE OF THE ECONOMY AND ECONOMIC HARDSHIP IN NIGERIA:
Nigeria, once hailed as the “Giant of Africa” due to its abundant natural resources and strategic economic position, now finds itself entrenched in an economic crisis that continues to worsen by the day. The reality of living and doing business in Nigeria today is defined by widespread inflation, rising unemployment, and a decaying infrastructure that fails to support its youthful population. The nation’s dependency on oil, combined with policy missteps and deep-rooted corruption, has crippled sectors that were once considered the backbone of the economy.
For many young entrepreneurs, the dream of running a successful business in Nigeria has turned into a nightmare of daily struggles. From fluctuating exchange rates and scarce access to foreign exchange to the burden of navigating inefficient government systems, the frustration is palpable. With over 33% of the youth unemployed and businesses closing down due to economic constraints, many young Nigerians are left questioning the viability of their entrepreneurial dreams.
In recent years, the government’s policies, though laden with promises of economic diversification and innovation, have failed to deliver tangible improvements. Instead, these failed promises have widened the gap between government rhetoric and the harsh realities of doing business in a failing economy. As a result, young entrepreneurs, once the hope for revitalizing the economy, are left navigating an economic landscape riddled with obstacles that undermine their potential to succeed.
ECONOMIC DIVERSIFICATION: THE MYTH VS. REALITY:
Nigeria’s economic diversification efforts have been plagued by a series of missteps and inadequate implementations. Government rhetoric has long promised a shift away from oil dependency, with initiatives aimed at bolstering sectors such as agriculture, manufacturing, and technology. However, these promises have often failed to translate into actionable strategies or substantial results.
Agriculture, for instance, was expected to become a major driver of economic growth. Despite the introduction of various support programs, the sector remains underdeveloped due to poor policy execution and insufficient infrastructure. Efforts to modernize farming and improve food security have been marred by insecurity, corruption, mismanagement, and inadequate support systems. As a result, Nigeria’s agricultural sector continues to struggle with inefficiencies and low productivity.
Similarly, the manufacturing sector, which was supposed to benefit from industrial policies and incentives, has seen little progress. High operating costs, erratic power supply, and lack of infrastructure, causing stifled growth and leaving many factories unable to compete with cheaper imports. The government’s failure to create a conducive environment for local production has left the sector stagnating while Nigeria remains heavily reliant on imported goods.
The technology sector, though burgeoning with potential, also suffers from inadequate support and infrastructure. While tech hubs and startups emerge, they are frequently constrained by poor and costly internet infrastructure, unreliable electricity, and insufficient government backing. The disconnect between the government’s promises and the realities faced by tech entrepreneurs further exacerbates the sector’s challenges.
POOR POLICIES ON AGRICULTURE: A CASE TO STUDY
Agriculture was once seen as a cornerstone for Nigeria’s economic diversification. However, the sector’s potential remains largely untapped due to a series of poor policies and ineffective implementations. Programs such as the Anchor Borrowers’ Programme, designed to provide financial support and resources to farmers, have been plagued by corruption and inefficiency. Access to credit and necessary inputs is often restricted by bureaucratic hurdles and mismanagement, leaving many young farmers without the resources they need to succeed.
Infrastructure deficiencies, including inadequate roads and irrigation systems, further hinder agricultural productivity. Farmers are unable to transport their goods efficiently, leading to significant post-harvest losses. The lack of investment in infrastructure and support services undermines the sector’s potential and exacerbates the challenges faced by young entrepreneurs in agriculture.
UNFRIENDLY BUSINESS ENVIRONMENT: BUREAUCRACY, HIGH/MULTIPLE TAXATION, AND INFRASTRUCTURAL DEFICIENCY:
The Nigerian business environment is characterized by a combination of bureaucratic inefficiencies, excessive taxation, and infrastructural deficiencies. Entrepreneurs face a complex and often opaque regulatory environment that creates significant barriers to starting and running a business. Bureaucratic red tape and corruption are pervasive, making it difficult for businesses to navigate legal and administrative processes.
The tax system is also a major obstacle. Multiple layers of taxation, often imposed arbitrarily and without coordination, place a heavy burden on businesses. Young entrepreneurs, particularly those running small or medium-sized enterprises, struggle to manage these financial pressures while receiving little support from the government.
Infrastructural deficiencies, such as unreliable electricity and poor transportation networks, further compound the challenges faced by businesses. Entrepreneurs are forced to rely on expensive generators and face logistical issues that increase operating costs and limit market access. The lack of basic infrastructure undermines the potential for business growth and innovation.
THE GROWING DISCONNECT BETWEEN GOVERNMENT AND ENTREPRENEURS:
The disconnect between government policies and the realities faced by entrepreneurs is a significant barrier to economic progress. The erosion of trust in government institutions and the perceived lack of genuine support for businesses have hindered economic recovery and growth. Entrepreneurs are left to contend with a system that seems more interested in maintaining the status quo than in fostering real economic development.
To overcome these obstacles, Nigeria must undertake a comprehensive reform agenda that addresses policy failures, supports entrepreneurship, and fosters a more stable and inclusive economic environment. This includes addressing bureaucratic inefficiencies, reducing tax burdens, investing in infrastructure, and ensuring that policies are implemented effectively and transparently.
MY SUBMISSION:
Nigeria’s economic hardship is a product of flawed government policies and systemic failures. The gap between promises of economic diversification and the harsh realities faced by entrepreneurs is wide, and young Nigerians are bearing the brunt of this failure. To revitalize the economy and support entrepreneurial growth, Nigeria must commit to meaningful reforms and address the underlying issues that have stifled progress. Only through genuine commitment to policy reform and infrastructure development can the country hope to achieve sustainable economic growth and provide a supportive environment for its young entrepreneurs.
