Article
The World Bank data on ease of doing business released this
year ranked Nigeria 169 out of 190 countries. Ten sub-indices were used for
this ranking such as starting a business, dealing with construction permits,
getting electricity, registering property, getting credit, protecting minority
investors, paying taxes, trading across borders, enforcing contracts and
resolving insolvency. One sub-indices that many Nigerians can relate with is
electricity. Although all Nigerians are feeling the effects, businesses are
feeling it more. Jumia Travel identifies 5 ways power shortage is affecting
Nigerian businesses.
Huge amounts are
budgeted for diesel and generator
There is no way any business can run smoothly without having
a generator notwithstanding if it is a startup or an established business. The
budget for generators, diesel as well as servicing these generators is
humongous. These monies, if there is no power interruption, can be deployed to
other aspects of the businesses.
Startups are likely to
fail
Many young Nigerians have ventured into the uncertain world
of entrepreneurship despite the recession. They have satisfied all the
constitutional requirements for setting up a business but they have to still a
factor in how to provide electricity. Over time, you will observe that some of
these great startups are likely to fail due to power shortage. They can only do
as much.
Businesses cannot
employ
If electricity can be tackled in Nigeria, the monies
companies spend on providing power can be used to employ more Nigerians. This
is a part reason why some companies prefer to use contract staff.
No room for growth or expansion
Growth and expansion are essential to any business. The more
businesses spend on electricity, the more they cut back on growth. Combining
power shortage with the economic recession, some companies have no choice than
to lay off some of their workers.
Businesses are moving
out
Nigeria is the biggest market in Africa. At the same time, it
has the biggest challenges. Some of them have decided to continue running their
businesses in the country, others have made the decision to move their
operations to other countries while maintaining a little presence in the
Nigeria.
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