When President Bola Tinubu unveiled his ambitious economic reforms in 2023, many hoped Nigeria would finally overcome the chronic obstacles choking business growth.
But two years on, importers, manufacturers and exporters say the on-ground reality still feels unchanged — slow, expensive and unpredictable.
Despite federal assurances and international praise for early reforms, operators across key sectors insist the nation’s business climate remains one of the biggest threats to economic progress.
Experts warn that Nigeria now loses between $12 billion and $20 billion every year due to inefficiencies that have become entrenched in daily operations.
“A process that should take hours now takes weeks”
At Apapa Port, importer Chinedu Okoye watches trucks struggle through long queues, waiting for a container carrying industrial components meant for a factory already idle for two weeks.
“This container should not stay more than three days,” he says. “But I now spend 14 to 18 days at the port. With demurrage, informal payments, and trucking costs, I lose ₦1.2m to ₦2m per container.”
For his 40-container annual import cycle, the delays alone cost him up to ₦70 million every year.
Terminal operators blame poor road access and bottlenecked berths, while freight forwarders point to duplicated inspections that slow processes to a crawl.
Even the Nigeria Customs Service admits coordination among agencies remains weak.
Manufacturers: “Power alone destroys your competitiveness”
In Ogun State’s industrial corridor, SME co-founder Amina Yusuf flips through another painful energy bill — a combination of unreliable grid electricity and diesel required to keep production running.
“We run generators for 70 per cent of production hours,” she says. “We spent ₦54 million on diesel in 2024 alone. Power costs have doubled our production expenses.”
Amina can no longer guarantee delivery timelines, causing FMCG and pharmaceutical clients to reduce their orders. Foreign buyers, she adds, now avoid Nigerian packaging producers entirely.
The Manufacturers Association of Nigeria (MAN) confirms that over 300 factories shut down or suspended operations between 2021 and 2024, with high energy costs and FX challenges among the leading causes.
Exporters count multimillion-dollar losses
Cashew exporter Kehinde Arowosaye had goods worth $118,000 damaged last year after a shipment got stuck at the port for 27 days.
“Cashew loses value in humid conditions after four weeks,” he explains. “One bad shipment and international buyers drop you.”
The National Cashew Association of Nigeria estimates the country loses about $250 million annually to logistics delays and transport inefficiencies.
Experts: Nigeria bleeds up to 5% of GDP yearly
Economists interviewed by New Telegraph say the cumulative cost of delays, inefficiencies, and policy inconsistencies equals 4–5% of GDP.
“These are not theoretical losses,” says economist Dr. Abdul-Ganiyu Bello. “They show up in factory closures, high import bills, and missed export opportunities.”
Six major structural problems holding businesses down
1. Chronic power shortages and rising energy costs
Businesses now spend 20–40% of operating costs on power — far above global averages.
2. Ports still slow despite partial digitisation
Customs processes are digital, but many inspection agencies still rely on paper systems, creating a half-digital, half-manual mix that slows movement.
3. Multiple taxation and excessive levies
SMEs face more than 50 different taxes across all tiers of government, undermining survival rates.
4. FX instability and unpredictable policy shifts
Businesses struggle to plan, with many forced into parallel-market sourcing.
5. Weak contract enforcement and slow courts
Commercial disputes can take up to seven years to resolve.
6. Insecurity and transport risks
Manufacturers now factor in security escorts and higher insurance costs, particularly in northern corridors.
Why reforms haven’t worked
Experts cite three core reasons:
A. Fragmented policy implementation between federal, state, and local authorities.
B. Resistance from vested interests benefiting from inefficiency and informal revenue channels.
C. Weak institutional capacity, including poor infrastructure, outdated systems and inadequate manpower.
The human cost: shrinking businesses and abandoned expansion plans
Amina, the manufacturer, has suspended plans to expand production.
Arowosaye, the exporter, has reduced commitments by 40%.
Okoye, the importer, has cut staff from 12 to five.
“It’s not that we can’t sell,” Okoye says. “It’s the operating costs that are killing businesses.”
What business leaders are demanding
- Stable power and affordable energy
- Predictable FX access
- Unified national tax framework
- Full port digitisation with all agencies on one platform
- Faster contract enforcement through digitalised courts
Federal officials insist reforms are underway, though they admit results will take time.
