Context

Nigeria is Africa’s biggest country by population and its second largest economy. It has the world’s 10th largest proven oil reserves and the 9th largest natural gas reserves. The UK-Nigeria trade relationship was worth £4 billion in 2015 and has the potential to grow significantly in future. Nigeria is therefore a significant trade and investment partner for the UK in Africa.

However, Nigeria faces a number of challenges to its future growth and development. Conflict continues to affect its oil-rich delta region and there is a violent Islamist insurgency in its north-east, which has caused a humanitarian crisis. Despite significant natural resources, around a third of Nigerians (60 million) live below the national poverty line with around another third just above; many of them are highly vulnerable and at risk of being trafficked to the UK. The government of Nigeria is taking the lead to tackle these issues, but struggles with corruption as well as the capacity and resources necessary. The UK is focused on helping Nigeria overcome these challenges.

According to the African Development Bank Economic growth, estimated at 5.2% in 2017, was driven largely by the secondary sector, particularly oil, which increased activity. Growth is projected to be 5.4% in 2018 and 5.2% in 2019, due to the performance of the oil and agricultural sectors. Agricultural performance is expected to rise as a result of good rainfall.

DFID Nigeria Strategy

Humanitarian and building resilience to crises: In 2017, UK aid will provide lifesaving support to more than 1 million people facing famine-like conditions in north-east Nigeria. The UK will also support the government of Nigeria to deliver a long term response to cope with the crisis, gradually decreasing the need for international humanitarian assistance.

Economic development and basic services: UK aid will improve the lives of the most vulnerable in Nigerian society, including through creating jobs and better health and education. The UK has already increased the income of 1.3 million Nigerians since 2015. By 2019 DFID will help 7.8 million people to have better nutrition and 500,000 children to have a decent education.

Building stability and institutions: UK aid will support federal and state level governments to be more effective, transparent and accountable to their citizens, including through support to the 2019 elections. Over the last four years the UK has helped recover £284 million in stolen cash and will continue to help Nigeria tackle corruption. UK aid will help Nigeria increase its own revenues by improving its tax systems and making it easier for businesses to invest.

World Bank Doing Business

Nigeria ranked 145th on the World Bank Doing Business ranking, which was a significant improvement in its performance in 2017.The distance to frontier score of 52.03 is above the regional average for sub Saharan Africa (50.43), and a large improvement on 2017’s score (48.18).  There was an especially large improvement in the score accessing credit.  Over the past year a range of reforms were implemented:

Starting a Business: Nigeria made starting a business faster by allowing electronic stamping of registration documents. This reform applies to both Kano and Lagos.

Dealing with Construction Permits: Nigeria (Kano) increased transparency by publishing all relevant regulations, fee schedules and pre-application requirements online. Nigeria (Lagos) made is easier to obtain construction permits by streamlining the process to obtain construction permits and increased transparency by publishing all relevant regulations, fee schedules and pre-application requirements online.

 Registering Property: Nigeria, Lagos made transferring property easier and more transparent by removing the sworn affidavit for certified copies of the land ownership records, introducing a specific and independent complaint mechanism, and by publishing statistics on land transfers. Nigeria, Kano made transferring property more transparent by publishing the list documents, fee schedule and service standards for property transactions.

 Getting Credit: Nigeria improved access to credit information by guaranteeing borrowers the legal right to inspect their credit data from the credit bureau and by starting to provide credit scores to banks, financial institutions and borrowers. Nigeria also strengthened access to credit by adopting a new law on secured transactions and establishing a modern collateral registry. These changes apply to both Kano and Lagos.

 Paying Taxes: Nigeria made paying taxes easier by introducing new channels for payment of taxes and mandating taxpayers to file tax returns at the nearest “Federal Inland Revenue Service (FIRS)” office. This reform applies to both Kano and Lagos.