Top 5 States To Do Business In Nigeria

  Nigeria is the biggest economy in Africa with a population size of over 180 million people. The people are known for their resilience, talent and hospitality. Interestingly, Nigerians, apart from having a huge stake in agriculture, are commercial traders, corporate workers, professionals and business people in general.

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The rise of SMEs grows by the day with over 500,000  businesses registered by the Corporate Affairs Commission (CAC), in the country. With the rise in the establishment of SMEs in Nigeria, the nation is blessed with several commercial centres. There are a lot of things investors, local business people and entrepreneurs consider before setting up a business. And one of those things they consider is the commercial power of the state of establishment. There are several indicators that point to the commercial power of a city or state. These indicators include population, internally generated revenue, access to goods, transportation system, housing and rent system, cash flow etc. In this article, I’m going to do a rundown of the top five states to do business in Nigeria. This analysis is based on previous research done by African Development Bank and other research institutions, surveys and personal observation.

1. Lagos State

Of course, this is very predictable. Lagos is a commercial leader not only in Nigeria but in Africa. The city is a coastal state situated by the Atlantic Ocean and is the first port of entry by sea. The state was the former capital of Nigeria, however, it remains the economic capital of the nation. It’s the largest commercial hub in Africa with a population size of approximately 15,000,000 people. According to Wikipedia,

‘Lagos is Nigeria’s economic focal point, generating a significant portion of the country’s GDP. Most commercial and financial business is carried out in the central business district situated on the island. This is also where most of the country’s commercial banks, financial institutions, and major corporations are headquartered. Lagos is also the major Information Communications and Telecommunications (ICT) hub of West Africa and potentially, the biggest ICT market in the continent. Lagos has one of the highest standards of living in Nigeria and in Africa.’

Aside from this, Lagos is the leading and busiest port in Nigeria and one of the largest in Africa. The port is divided into three operational terminals: Apapa Wharf, Tin Can and Lagos Port. In these ports, goods arrive from all over the world in large containers.

2. Anambra State

The state of Anambra ranks number three in states with the highest internally generated revenue (IGR). Blessed with several commercial centres, Onitsha, Nnewi and Awka are among the biggest centres in Anambra state. Let’s look at Onitsha and Nnewi.

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The ancient coastal city of Anambra state is sited on the Niger River with a population of 11.499 million people living in the city. Home to the Igbo people who are known for their commercial industry and business acumen, Onitsha is one of the oldest African markets, according to colonial records. As a matter of fact, the city is the home of the Onitsha market, the biggest single market in West Africa. According to Pulse Nigeria:

‘From imported second-hand clothing to jewellery to industrial equipment, Onitsha has it all in its expansive market, considered the biggest market in terms of item availability and land size.’

According to observations, foreigners from West African countries such as Mali, Ghana, Togo, and in fact in all of West Africa graces the market every day. The second leading centre, Nnewi, is the home of Nigeria’s richest men, with businesses in manufacturing and industry. The city is the home of electrical appliances and vehicular spare parts. In this sense, Anambra ranks number two in this list.

3. Abuja

It’s not surprising that Abuja ranks third on this list. Being the capital of Nigeria, Abuja has been regarded according to several studies as one of the fastest-growing cities in Africa. Being the administrative headquarters, it houses several headquarters of both private and public parastatals and offices such as government secretariats, ministries, international organizations and so on, which adds to the economic bulk of the state. Furthermore, Abuja’s road network and transport system add to its attraction to businesses. The Central District is the state’s major commercial centre. However, the city’s housing and rent are some of the most expensive in Nigeria.

4. Rivers State

With a population of approximately 5 million people and a GDP of $21.07 billion, River state ranks fourth on this list. Rivers State’s capital, Port Harcourt is the leading commercial centre in the south-south region of the country. The state is the leading oil-producing state in the country and home to several oil-producing corporations such as Shell, Mobil, Escravos etc.

5. Kano State

This is the biggest economy in northern Nigeria and the second-largest industrial centre, second to Ogun State. The state also has a population of about 15,076,892 according to Wikipedia. The ancient city of Kano houses several industries that produce confectioneries, plastics, dairy products, etc. The trading centre had its reputation as a commercial centre since the 16th century. It ranks number six in the states with the highest GDP. It boasts an annual turnover revenue of $30 million. Featured Image Source: Wealth Result

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This article was first published on 15th October 2021

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