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ANALYSIS: Which States is conducive for manufacturing

By Franklin Alli

OUT of 36 states in the country, including Abuja, the Federal Capital Territory, which ones have  conducive environment for the establishment of manufacturing and other business enterprises. ?

Well, the answer was made public last week during the launch of a publication, tagged: ‘Business Environment in Nigerian States 2010.’

The event was chaired by Mazi Sam Ohuabunwa, the Chairman, Nigerian Economic Summit Group(NESG), and it wall well attended by government officials, policy makers, international development bodies, among other industry chieftains.

According to findings in the report written by  the Executive Director, African Institute for Applied Economics, Prof. Eric Eboh, and Dr. Jones Lemchi, the business environment across the states has not generally improved in the last three years, since 2007.

The following benchmarks were used: Business Environment Index, infrastructure and utilities, regulatory services, business development support and investment promotion including security.
A look at the performance of individual States and Abuja FCT on Business Environment Index, showed that Abuja FCT has the highest performance on the Business Environment Index, followed by Lagos State, while Zamfara State has the lowest performance.

Moreover, on Business Development Support and Investment Promotion , the report showed that institutional support for business and investments has generally weakened since 2007, yet, Lagos State has the highest performance on Business Development Support and Investment Promotion while Kebbi State had the lowest performance. The other relatively high performers on Investment Promotion are Oyo, Ondo, and Niger.

Also, the report further showed that despite  the poor condition of industrial parks throughout the states, Lagos State has the highest score on ‘Support for Industrial Parks’, followed by Kano and Cross River States.

On access to Finance, again, Lagos State has the highest performance on access to finance, followed by Abuja FCT. Ebonyi and Bayelsa States had the lowest performance.

Regarding security , findings showed that there has been a general deterioration in security since 2007. The North-West zone has the highest performance on security, while the South-South and South-East are the least performing.

The North-East zone has the best performance with respect to perception on Security, while the South-East Zone has the lowest
“The Business Environment Report is vital for state-level business environment reforms.

We urge private sector and civil society organisations to utilise the evidence to dialogue and advocate for a better business environment. State governments should see the performance assessments in terms of opportunities and challenges to make their jurisdictions more business-friendly,” said Prof. Eric Eboh.

According to him, the disparity in the quality of business environment across states suggests that federal government reforms can have the desired impact only if complemented with context-specific reforms by the state governments.
He concluded that if all states were to perform at the level indicated by the best performing state across all the benchmarks, the all-States average performance on the business environment index would jump from 45.43 per cent to 68.5 per cent .

“ This analogy surmises the extent to which business environment could be enhanced if state governments were to implement needed reforms in policy, regulatory services and administrative practices.”


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