Nigeria is Open for Business, But There’s a Puzzle to Solve

Author: Ajiroba Hammed

Africa’s biggest economy has all the ingredients. What it still lacks is an honest conversation about why so much potential keeps getting left on the table.

This column begins with a simple admission: Nigeria is not an easy place to do business. Anyone who tells you otherwise is either selling something or hasn’t tried. The power goes out. The roads fight back. The paperwork multiplies. The exchange rate moves while you sleep. And somewhere in the middle of all that, millions of Nigerians still go to work, still build companies, still find a way to turn a profit. That contradiction is what this column is about.

This is not one of those cheerful summaries of GDP figures, or compilation of yet another story about what is broken. Both approaches exist in abundance. What Nigeria’s business conversation actually needs is something more difficult: a sustained, clear-eyed look at the economy as it is, not as we wish it were, not as the press releases describe it. So that is what “Naira & Sense” will try to do, starting today.

What Is Actually Working

Nigeria’s technology sector has pulled off something that would have seemed far-fetched a decade ago. Lagos is now a credible startup hub, not just by African standards but globally. Flutterwave reached a valuation of over $3 billion. Paystack was acquired by Stripe for a reported $200 million before it was five years old. Interswitch has processed transactions that touch nearly every corner of the financial system. These are not vanity metrics. They are proof that Nigerian founders, when given access to capital and the right environment, can build companies that compete anywhere.

Agriculture is comparably quiet, but it may end up as the powerhouse of our revenue. Nigeria has roughly 70 million hectares of arable land, and a significant portion of it remains underused. The federal government’s push away from oil dependency has been uneven, but it has created real openings. Farmers in Benue are building cassava processing operations. Poultry businesses in Ogun have gone from backyard ventures to commercial-scale supply chains. Cocoa exports from the southwest are finding buyers in Europe who specifically want Nigerian origin. These are not pilot projects. They are functioning businesses.

Then there is Nollywood, which is no longer just a cultural talking point. The film industry produces more titles annually than Hollywood. The global appetite for African storytelling, fed by streaming platforms that now actively license Nigerian content, has turned what was once an informal cottage industry into a sector with real export revenue. Add Afrobeats, which now fills arenas in London, Toronto, and Houston, and you start to see an entertainment economy with genuine commercial weight behind it.

“The Nigerian entrepreneurs do not wait for perfect conditions. They build anyway. That is both admirable and, frankly, a sign that something is wrong with the conditions.”

Where the System Is Failing

Power seems to stand ahead and above. Power supply is the most visible failure, and it has been for decades. Nigeria generates far less electricity than its population needs, and what is generated is distributed unreliably. The practical consequence for business is that most serious operations run their own diesel generators. That is not a work-around. It is a second electricity bill, layered on top of all other costs, that makes Nigerian goods more expensive to produce and therefore harder to sell at competitive prices. An SME spending a third of its monthly budget on generator fuel is not building; it is surviving.

The regulatory environment punishes the wrong people. Getting a business registered, obtaining the necessary permits, navigating the tax system, these processes are slow and opaque in ways that benefit people who already have relationships inside government. First-time founders without those relationships pay for it in time and money. The word “settlement” has entered the business vocabulary as something between a fee and a bribe, and most entrepreneurs encounter it within the first year of operation. Giving it a different name does not change what it is.

Foreign exchange has become a source of genuine business risk that goes beyond normal currency fluctuation. The naira’s sharp depreciation over the past two years has been particularly damaging for importers and manufacturers who price their inputs in dollars but sell their outputs in naira. Every Central Bank policy announcement carries real consequences. When the rules around forex access change without warning, businesses that had planned months in advance find themselves exposed in ways they could not have predicted. Uncertainty at that level discourages long-term investment, and that is a slow damage that does not show up immediately in any single quarter’s numbers.

Access to credit is still largely unavailable to the businesses that need it most. Commercial banks in Nigeria lend comfortably to large, established corporations with real estate as collateral. For a founder with a solid business plan but no property to pledge, the formal banking system is mostly decorative. Interest rates above 20 percent make borrowing an option only when there is no alternative. The result is that most small businesses are funded by personal savings, family contributions, or informal lenders charging even higher rates. That is not a financing ecosystem. It is a gap dressed up as one.

What This Column Will Do

Every edition of Naira & Sense will try to address Business today in Nigeria with facts, figures and with opinions of people in the business world. That means interviewing founders about what running a business in Nigeria actually costs, not just what it earns. It means examining policy decisions and asking plainly who benefits and who does not. It means tracking sectors over time instead of treating each development as a stand-alone story.

It also means being willing to say when something is working, even when the surrounding narrative is negative, and being willing to say when something is failing, even when the surrounding narrative is celebratory. Neither reflexive optimism nor reflexive pessimism is analysis. This column aims to be analytical.

Nigeria has the land, the people, the ideas, and the cultural energy to build an economy that works at scale. That is not promotional language. It is an assessment based on what already exists. What is still being built is the institutional and policy architecture that turns potential into consistent outcomes. That process is slow, frustrating, and non-linear. We plan to document it clearly, for as long as it takes.

If you are building a business here, investing from the outside, setting policy from the inside, or simply trying to understand the economy you live in, this column is written
for you. We are glad you found us on the first edition