Enugu Coalition Of Business and Professional Association

Services

The Enugu Coalition of Business and Professional Associations (ECOBPA) was established to drive policy reforms initiatives that will engender more business friendly environment in Enugu state. To achieve this, ECOBPA engages with the government and relevant stakeholders regularly on policy dialogues with credible representation of the private sector in the state. The coalition is recognized as an important body through which grassroots opinions on socio-economic matters are presented directly to the state government as well as other stakeholders.

To function effectively, the coalition’s core services are:

Research

ECOBPA periodically scans the entire Enugu State Business Environment to identify issues that are hindering the growth of free enterprise and businesses. Most of these issues have been found to be associated with Government policies. ECOBPA does not just assume the existence of issues or factors responsible for the slow growth of free enterprise without conducting adequate survey to come up with empirical result. These surveys produce verifiable facts and provide policy recommendations for the government and other stakeholders. Some of the research projects carried out by the Coalition are:

  1. SURVEY ON BUSINESS ENVIRONMENT REFORMS AND THE PLIGHT OF BUSINESSES IN THE SOUTH-EAST OF NIGERIA:

 

Specifically in 2011, the Coalition observed the deplorable state of the business environment in South East Nigeria, which called for a concerted effort to address the issues and advance policy reforms through co-operative efforts in confronting the economic challenges.

Notably, Nigeria as at 2010/2011 was gauging her business environment at the sub-national level through two key and major reports. These are the Business Environment and Competitiveness across Nigeria States (BECANS) published by the African Institute for Applied Economics [AIAE], now African Heritage Institute (AHI) and the Doing Business in Nigeria published by the World Bank. Both BECANS II report and the Doing Business in Nigeria 2010 launched and released in 2010 indicated that the prevailing business in environment in the South-East was deplorable especially when compared with other states in the country.

In view of the worrying business environment in the Southeast as shown by the AIAE’s BECANS Report and World Bank’s Doing Business Report of 2010, the Coalition conducted a survey of 100 business outfits in the region. The survey sought the experiences of firms with regards to six issues – namely starting a business; construction permit; registering property; enforcing contracts; tax administration; and security. We highlight some of the issues below.

Starting a business – the experiences of the sampled firms show that it takes about 67 days approximately to start a business in the Southeast with an estimated average cost of about N91, 233. On the average it takes following number of days to complete the following steps in starting a business in the region: a) check availability of company name with CAC – 12 days; b) prepare the requisite incorporation documents and pay the stamp duty – 10 days; c) notarize the declaration of compliance (CAC 4) – 6 days; d) register the company with CAC and pay fees at the bank – 10 days; e) register with FIRS for income tax and VAT – 9 days; f) register for PAYE at the SBIR – 3 days; g) receive inspection from local government – 12 days; h) pay fees at a designated bank – 3 days; and i) pay for business premises permit – 2 days.

Dealing with construction permit – surveyed firms in the region on the average spend about 172 days in complying with building regulations at an estimated average cost of about N1.2 million. On the average, it takes following number of days to comply with the following procedures: a) obtain an environmental impact assessment report – 14 days; b) obtain development permit from LGA – 12 days; c) pay development levy to the local planning authority – 3 days; d) pay the spatial enhancement contribution to State urban and regional planning board in bank drafts – 2 days; e) obtain certificate of structural stability of foundation from an accredited construction testing company – 5 days; f) obtain a certificate of structural stability (first pouring of concrete) – 10 days; g) obtain a certificate of structural stability (second pouring of concrete) – 7 days; h) obtain a certificate of structural stability (third pouring of concrete) – 7 days; i) receive an inspection during construction by the State Government Task Force reporting to the Commissioner of Land and Urban Development – 6 days; j) receive an inspection during construction by the Local Monitoring Team reporting to the Local Government – 6 days; k) receive an inspection during construction by the Zonal Monitoring Team – 5 days; l) request and receive inspection by the Fire Service Department – 6 days; obtain a certificate of completion and fitness for habitation – 7 days; m) obtain a fixed telephone line – 9 days; n) apply for electricity connection – 36 days; o) receive inspection by PHCN – 13 days; p) obtain electricity connection – 16 days; and q) dig a borehole to obtain water – 8 days.

Registering Property – transferring a property from one business to another in the Southeast requires at least 225 days on the average. It takes the following procedures and days on the average: a) conduct a property title search at the Land Registry – 6 days; b) obtain Application Land Form IC – 8 days; c) obtain certified true copy (CTC) of title document – 13 days; d) obtain a survey plan – 11 days; e) execution of deed of assignment/conveyance and land form IC – 24 days; f) payment of charting the charting fee, administrative fees, endorsement fees at a designated bank – 4 days; g) submit application for Governor’s Consent to the assignment – 4 days; h) obtain notice of Stamp Duty, registration fees, consent fees, neighbourhood improvement charge at the Land Registry – 7 days; i) payment of stamp duty, registration fees, consent fees, neighbourhood improvement charge at a commercial bank – 4 days; j) submit the receipts of the registration fees, consent fees, neighbourhood improvement charge, stamp duty – 3 days; k) obtain file from the Land Services Department – 4 days; l) stamping of the Deed of Assignment – 6 days; and m) registration of Certificate of Occupancy (C of O) or Deed on title conferred – 132 days.

Enforcing Contracts – the experience of firms in the region with regards to the efficiency of the judicial system in resolving commercial sale dispute before a local court indicates that it takes at least 968 days on the average to enforce a contract with an average cost of N377, 000. In term of procedures and time taken on the average: a) filling and service – 10 days; b) trial and judgement – 950 days; and c) enforcement of judgement – 8 days.

Tax Administration – the average time (administrative burden) required to comply with taxes in the region is 40 days approximately at an average estimated cost of N285, 000. Firms complained of numerous taxes/levies paid to different tiers of government. The surveyed firms paid about N106, 000 in taxes per annum on the average. The procedures and time taken are as follows on the average: a) stamp duty – 4 days; b) building permit – 15 days; c) property transfer – 7 days; d) taxpayer identification number (TIN) – 7 days; e) pay as you earn (PAYE) – 4 days; and f) one stop shop for taxes/fees – 4 days.

Security – businesses within the region are faced with numerous security challenges. These include cases of kidnapping, robbery, burglary, vandalism, looting and arson. These crimes have caused surveyed firms about N26 million on the average. The surveyed firms perceive that crimes such as kidnapping, robbery, burglary, vandalism and looting are on the decline in the region but arson is on the increase. About 95.5% of the surveyed firms in the region pay for private security and they spend on the average at least 19% of their revenue on security monthly.

The underlying issues here were that interviewees identified some factors which affect various stages or aspects of a business life in the prevailing business environment in the Southeast of Nigeria. These are summarized as follows:

  • Long and time-consuming (slow) procedures in formalizing and running businesses due to civil service bureaucracies;
  • Corruption-infested procedures (i.e. demand for gratification) in formalizing and running businesses;
  • Unregulated and dubious agents in the system;
  • Intimidating enforcement (i.e. use of thugs and touts);
  • Imposition of unauthorized logistics costs;
  • Adjournments and slow trial;
  • Numerous taxes/levies; and
  • Slow investigation process.

In view of the identified underlying factors and the need to make the South East the destination choice for both local and foreign businesses, the Coalition demanded a service charter as follows:

Service rendered

Requirements

Charges

Suggested Time Frame

Starting a business

Reduction in the number of procedures, time frame and fees (e.g. Senegal has only 4 procedures; takes 1 day to register a business in New Zealand)

Free

1 day

Construction permit

One-stop shop (OSS) for construction permits, reduction in number of procedures and time frame (e.g. Denmark has only 6 procedures; takes 25 days in Singapore)

Should not be more than 1% of income per capita

Not more than 30 days

Registering a property

Digitalization and reduction in number of procedures; reduction in time frame  and cost (e.g. Norway has only one procedure; takes 2 days New Zealand; and costs only 1% property value in Ghana)

Should not be more than 1% of the property value

Not more than 3 days.

Enforcing contracts

Commercialized special courts and digitalization of procedures; reduction in time frame and cost (e.g. Ireland has on 20 procedures; it takes only 150 days in Singapore; and costs only 0.1% of claims in Bhutan.

Should not exceed 1% of claim

Not more than 60 days.

Tax administration

Consolidated payment system (reduction in the number of payments per year at all levels of governance) in other to improve compliance; OSS for Federal, State and Local Government taxes; and reduction of average number of day/hours required to meet tax burden. E.g. the number of payments per year is 3 in Maldives and the total tax rate (% of profit) is 0.2 in Timor-Leste.

Total tax rate as percent of profit should not be more than 1%.

Compliance should not exceed 1 day.

security

Defining, deploying and managing policies, procedures and technologies required to effectively mitigate risks. We can’t afford to ignore exposure anymore.

Not applicable

Not applicable

                  2. SURVEY ON “THE EFFECTS AND IMPACT OF CORRUPTION ON COMMERCE AND BUSINESS DEVELOPMENT IN NIGERIA”


 

In 2014, the Coalition conducted a survey on “the Effects and Impact of Corruption on Commerce and Business Development in Nigeria”. This was aimed at finding out if the observed continues rise in the level corruption in the public sector has any effect on businesses in Nigeria using Enugu State as a case study.

To archive this, 100 businesses were randomly selected for this field survey in Enugu State and out which 99 of the businesses/respondents questionnaires were returned within the given schedule and were used for the analysis within the given time frame.

Interestingly, the outcome of this very exercise was very much in tandem with the generalized view point and perception which has been proven systematically and scientifically from the findings of the survey. That is, that the incidents of corruption while carrying out needed transactions in the public service have increased the cost of doing business, pricing and revenue increased of goods and services which is a negative index that hurts the entire economic cycle that does no one any good.

In 2016, ECOBPA launched Enugu State Business Agenda after a statewide survey covering strategic locations in the three senatorial districts of Enugu state.

The Enugu State Business Agenda (ESBA) galvanizes ECOBPA advocacy vis-à-vis the government and other stakeholders. Applying the advocacy tools of public policy, public relations, and direct engagement, the ESBA plan articulates private sector’s interest and government actions that will enhance the competitiveness of Enugu business environment even as Nigerian government intensifies effort towards a private sector driven economy.

ECOBPA remains a key actor in the economic growth, wealth creation, employment generation and value re-orientation in Enugu State. ECOBPA acts as a better rallying point for its members to advocate for reform in business environment. ECOBPA works for its members –businesses that represent different business engagement.

In order to ensure robust outcome which represents the interest of the entire Enugu business community, the SBA captured the opinion of non-ECOBPA members’ business operators. It takes into account issues that are of concerns to the entire business community. The SBA categorized these issues into seven thematic areas which are the focus of the entire business agenda. These thematic issues prompted the current ECOBPA advocacy efforts. ECOBPA is made up of members who share common mission of ensuring business-friendly environment in Enugu State all year round by working with government and other well-meaning stakeholders to create business environment that ensures globally-competitive economy in Enugu State

The first thematic area focuses on indiscriminate arrest of citizens & vehicle clamping by traffic officers of various other government agencies such as ECTDA & ministry of transport. Under this area, the recommendations deal with ways to reduce traffic offence, refine the operation of government traffic agencies and more importantly prosecute impostors (touts who masquerade themselves as government traffic officers)

Arbitrary nature of Enugu State Waste Management Authority (ESWAMA) operations in Enugu State, the second thematic area, deals with ways of reforming the operation of ESWAMA most especially the crude and inhuman treatment of citizens. Appropriate identification of staff, sensitizing of public as well as the officials of ESWAMA on the functions and boundaries of the agency will help to limit the impunity of the agency. Hence, reduce the negative socioeconomic effect on business and general economic growth of the State.

High cost of property (commercial property) rent in Enugu State, reducing high cost of commercial property rent will help to boost economic and social welfare of the citizens. Steps to achieve this will include regulating the arbitrary increment in rent, sensitization of public and property owners about the State rent edict and also enforcement of punishment of offenders.

The issue of security challenges. Under this area, the objectives include the imperative to stop the wanton grazing of farmlands by herdsmen; elimination of cult activities, reinforcement of neighbourhood watch (community policing).

The next thematic area is the problem of arbitrary electricity charges by EEDC staff for businesses in Enugu State. The recommendations made under this thematic area include the elimination of “estimated” electricity bill for electricity consumers through the prompt provision of prepaid meter for customers; upscaling of electricity infrastructure; adequate security of EEDC property to avoid vandalisation by criminals.

Problem of extortion by ministry of agriculture (government warehouse officials) in fertilizer distribution to farmers in Enugu State, the recommendations to improve the situation include direct supply of fertilizers by Fertilizer Procurement Distribution Company to designated AFAN warehouses in the State. This will ensure that farmers get fertilizers in time, at subsidized official rates with minimal hurdles. Also, Enugu State government should liaise with ECOBPA for adequate monitoring and supervision of fertilizer distribution in Enugu State

Finally, demand for bribes by ministry of land officials for issuance of Certificate of Occupancy from people who want to register land in Enugu State was dealt with. Under this issue, governor should set a time frame of three months for the issuance of Certificate of Occupancy from the date of submission of application, Ministry of Lands and Urban Development should adopt e-payment system and the operations should be monitored. The Governor should put in place a one-stop shop for land and property registration in Enugu State, Governor should set a time frame of say six months to clear the backlog of already submitted applications, high incidence of preferential treatment associated with the process should be stopped. Also, land owners should make proper documentation and submit correct/completed documents to the Office of the Lands and Urban Development

Notably, these research projects most times are carried out through the support of our partner, Center for International Private Enterprise. (CIPE).

Advocacy

ECOBPA engages the government of Enugu State and other stakeholders with evident based report of surveys carried out on issues affecting businesses. These evident based reports are packaged in simplified documents to attract the interest of the relevant government agencies and stakeholders. One of such advocacy materials produced by the Coalition is the Revised Enugu Business Agenda which was launched in January, 2020. Visits were made to relevant Government Agencies and Stakeholder to discuss these business related issues for policy reforms.

Since 2010, the Coalition has successfully carried out the following Advocacy Programs aimed at improving the State Business Environment. These include:

  1. The Advocacy dialogue on Tax Regime & Administration (2010). After this advocacy, the Government of Enugu State was moved to set up an inter-ministerial committee which brought the government and the private sector to a point of decision on taxes and levies.
  1. Security Summit (2010). This summit revealed some methods that were adopted by the then governments of the South East to tactically address the issue of kidnapping which was growing in 2010.
  1. Advocacy Campaign carried out to address the issue of the ranking of the 5 South East States as the worst environment in the ease of doing business in Nigeria following the then World Bank Report and BECANS II by the African Institute of Applied Economics now known as African Heritage (2011). The issues or indicators to what informed the ranking was hinged on Multiplicity of Taxes/Levies, Registration of Property, starting a business, construction permit and enforcing contracts.
  1. Launch/Advocacy Program on the State Business Agenda (SBA). The 8 priority issues that were affecting businesses in Enugu State were dealt with in the SBA and this remains the focal point of the Coalition which were encapsulated in the SBA Policy Brief Document that was first launched and presented to the Public in November, 2016.

            The Enugu State Government’s adoption and implementation of some of the recommendations of the SBA resulted in the World Bank             rating Enugu State the Second Best State on the Ease of doing Business in Nigeria in the year 2018.

  1. The launch of/advocacy on the Revised SBA (2020). Coalition after about 4 years reviewed the implementations of the recommendations and the impact of the maiden edition of the SBA and observed with strong convictions that 3 out of the 8 issues had received appreciable levels of improvement. Therefore, further investigation/survey on the other five issues which received none or little improvement, gave birth to the Revised Edition of the State Business Agenda. The Coalition will still embark on advocacy visits to relevant Government ministries/agencies as soon as the lockdown is relaxed.

Public Private Dialogue

ECOBPA creates platform for the Government and the Private Sector to meet and dialogue on evident based issues affecting the growth of businesses in the State. Most times such meetings are organized in high profile Hotels within the City to create a conducive and secured environment for the political class and the representatives of the Government who are being engaged by the Private Sector being represented by ECOBPA.

These dialogues are aimed at bringing the Government to point of understanding the effect of every of its action/policy on the businesses in the State. The end product of every dialogue is to create a safe haven for both the Public and Private Sectors such that there will appreciable level of economic growth.

The Coalition has held a number of Public Private Dialogue that were well attended by   high profile government officials.

In 2012, there was a Public Private Dialogue on Business Environment Reforms and the Plight of Businesses in the South-East with members of the Enugu State House of Assembly at Nike Lake Hotel, Enugu led by the then Speaker, Rt. Hon. Eugene Odoh.

In 2013 there was also another Public Private Dialogue with the Ministry of Enugu Capital Territory Development Authority ECTDA under the then leadership of Engr. IK Ugwuegede where the issues of the manner and operation of Traffic Officers in the clamping of vehicle were discussed, recommendations and solutions proffered, the issue of property registration and construction permit were further discussed, and appropriate recommendations made.

Also the Dialogue with the management of Board of Internal Revenue on the issue of Multiple Taxation/Levies which held in 2014.