Unemployment And The Challenges Of Starting A Business In Nigeria
With a growing population of over 170 million people, unemployment remains on top of the list of social problems confronting Nigeria for several years. The inability of the government to provide employment opportunities for graduates or enabling environment for self-employment/business to strive, This has been subject of too many discourses about Nigeria, both at national and international levels, in fact, recent indication show that unemployment has risen in less than 200 days of the new government, more than 700, 000 Nigerians are reported to have joined the unemployed.
Job creation has been politicized in Nigeria. Tackling this menace has been cheapened to ordinary political statements and fire brigade approaches. It is a multifaceted problem, that the government has failed to provide employment opportunity is a phase, more also; the failure of the government to provide enabling infrastructures needed for small scale businesses to strive is another phase. Nigeria’s economy has been ranked the largest economy in Africa, yet there are tough challenges confronting business start up in Nigeria. It is disturbing that the economic ranking of the country continues to contradict the true situation of starting a business in Nigeria.
Since the emergence of the global economic crisis, unemployment has been a global issue, however, government investment into the private sector through funding of entrepreneurs have created millions of job opportunities in various countries. Nigeria’s entrepreneurial empowerment has been more theoretic than visible. The following challenges of starting a business in Nigeria: Infrastructural Deficit, Corruption and Lack of funding and Political Instability:
Infrastructural Deficit: Nigeria has failed in infrastructural development, the margin between infrastructural development and underdevelopment in Nigeria is hopeless. Across the globe, no government can provide sufficient employment opportunities for its populace, but government can create infrastructures that will enable businesses to strive, particularly small scale businesses. Many businesses have collapsed in Nigeria due to infrastructural deficit. For instance, since independence, Nigeria has never enjoyed uninterrupted power supply. However, power is a major infrastructural demand needed for businesses to flourish, businesses incur more cost on petrol/diesel in a bid to generate power. The shortfall in infrastructure in Nigeria has heightened unemployment because it unsettles the atmosphere that should allow businesses to strive.
Corruption and Lack of Funding: Corruption in the Nigerian society is as old as the country. This has affected all spheres of development in the country. Corruption in the area of job creation is vast, ranging from fraudulent activities in government employment schemes, to mismanagement of empowerment funds. As many as would have been self employed in the Nigerian society, inability to access fund has weakened their dreams. Most government fundings are theoretic than visible, large sum of money are usually earmarked for business empowerment but such funds have no traceable success record. More also, many government funding end up in hands of non targets. For instance, beneficiaries of many Agric loans are not even farmers. The alternative, which is the financial institutions also places huge embargoes on loans that discourage small scale business owners. More than 73% of Nigerians featuring the Gallup survey conceded access to finance was the single-most important hurdle in the way to setting up successful enterprises.
Political Instability: Nigeria is a core heterogenous society which is unstable politically. Every government is accosted with strong opposition from various interest groups that ensure their activities unsettle and unfocus the government. Without stability, there cannot be progress. The more unstable the government is, the more vulnerable the society is. Nigeria has moved from one level of political instability to the other with varying degrees on intensity. Like others, this has inflated unemployment and made it more difficult for businesses to strive. More often, government substantial employment plans are marred by unhealthy political interests and strong ethnic and religious identities. In addition, every government digress totally from good reforms made by previous government. Sustainability is key in development, without a deep sense of sustainable development, growth will be impossible. It's senseless for any government to ignore bright ideas of a previous administration for the sake of self sufficiency.
The current situation doesn't not make it easy to develop a business in Nigeria. Infrastructural deficit , corruption and lack of funding, political instability inflates unemployment and complicates business start up in Nigeria. Beyond rhetorics, Government must think in the direction of infrastructural development to make the environment more enabling for businesses to strive. Corruption has to be tackled and funds have to be made available for entrepreneurs to access.
Olawale Rotimi tweets from @RotimiLawale. He can be contacted through [email protected]
B.A, M.A Ilorin, DELF Paris.
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