Nigeria’s entrepreneurial ecosystem remains active, but new research published today reveals that deep-seated structural and institutional challenges persist, limiting sustainable business growth across the country.
A study released in the World Review of Entrepreneurship, Management and Sustainable Development examined Nigeria’s business environment and found that while startup activity is high, long-term sustainability remains weak due to limited infrastructure, fragmented regulation, and restricted access to finance.
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Weak infrastructure and regulatory overlap
The study highlights that inadequate electricity supply, poor logistics networks, and inconsistent digital infrastructure increase operating costs for small businesses. Entrepreneurs are forced to rely on alternative power sources, which reduces margins and discourages expansion.
Regulatory complexity also remains a major concern. Multiple levies from federal, state and local authorities continue to create uncertainty, particularly for SMEs operating across state lines. Researchers noted that overlapping regulations discourage formalisation and limit access to institutional funding.
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The finance gap restricts business scale
Limited access to affordable finance was identified as a critical barrier. Although government-backed intervention funds exist, many entrepreneurs struggle to meet documentation and collateral requirements. As a result, businesses rely heavily on personal savings or informal lending.
The report stresses that without broader access to credit, SMEs are unable to invest in technology, workforce development, or export-oriented production.
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Policy coordination remains key
Researchers emphasised that policy consistency and coordination will determine whether Nigeria’s entrepreneurial energy translates into long-term economic value. They recommend harmonised regulations, targeted infrastructure investment, and improved financial inclusion strategies.
