AN ENABLING BUSINESS ENVIRONMENT FOR ENTREPRENEURS

We continue to focus on creating an enabling business environment for

our small and medium-sized enterprises to thrive by making Nigeria a progressively easier place to do business, delivering several reforms, as evidenced by our moving up 24 places in the World Bank’s Doing Business report over the past three years. 

In 2019 and beyond, we are confident that by driving agriculture and agro-based industries, technology and innovation, solid minerals, and our vibrant creative sector, Nigeria will harness the energies of our entrepreneurial youth to deliver the promise of our future.

How Entrepreneurs support Economic Growth

Entrepreneurs Spur Economic Growth
New products and services created by entrepreneurs can produce a cascading effect, where it stimulates related businesses or sectors that need to support the new venture, furthering economic development.

For example, a few information technology companies made up the IT industry in India during the 1990s. The industry quickly expanded and many other sectors benefited from it. Businesses in associated industries—such as call center operations, network maintenance companies, and hardware providers—flourished.

Education and training institutes nurtured a new class of IT workers who were offered better, high-paying jobs. Infrastructure development organizations and even real estate companies capitalized on this growth as workers migrated to cities where employment was growing.

Similarly, future development efforts in underdeveloped countries require robust logistics support, capital investments, and a qualified workforce. From the highly qualified programmer to the construction worker, entrepreneurship benefits a large part of the economy.

Entrepreneurs Add to National Income
Entrepreneurial ventures help generate new wealth. Existing businesses may remain confined to existing markets and may hit the glass ceiling in terms of income. New and improved products, services or technology from entrepreneurs enable new markets to be developed and new wealth to be created.

Additionally, increased employment and higher earnings contribute to better national income in the form of higher tax revenue and higher government spending. This revenue can be used by the government to invest in other, struggling sectors and human capital. 

Entrepreneurs Create Social Change
Through offering unique goods and services, entrepreneurs break away from tradition and reduce dependence on obsolete systems and technologies. This results in an improved quality of life, improved morale, and greater economic freedom.

For example, the water supply in a water-scarce region will, at times, forces people to stop working to collect water. This will impact their business, productivity, and income. Imagine an innovative and automatic pump that can fill people's water containers automatically. This type of innovation ensures people are able to focus on their jobs without worrying about a basic necessity like water. More time to devote to work translates to economic growth.

For a more contemporary example, smartphones and apps have revolutionized work and play across the globe. Smartphones are not exclusive to wealthy countries or people. As the growth of the smartphone market continues, technological entrepreneurship can have a profound, long-lasting impact on the world.

Moreover, the globalization of technology means entrepreneurs in lesser-developed countries have access to the same tools as their counterparts in richer countries. They also have the advantage of a lower cost of living, so a young entrepreneur from an underdeveloped country can compete with a multi-million-dollar existing product from a developed country. 

Community Development
Entrepreneurs regularly nurture ventures by other like-minded individuals. They also invest in community projects and provide financial support to local charities. This enables further development beyond their own ventures.

Some famous entrepreneurs, such as Bill Gates, have used their money to finance good causes, from education to public health. The qualities that make one an entrepreneur are the same qualities that help motivate entrepreneurs to pay it forward. 

The Bottom Line
The relationship between entrepreneurship and economic development is important to understand for policymakers and business owners. Understanding the benefits and drawbacks of entrepreneurship allows a balanced approach to nurturing entrepreneurship to be taken, which can result in a positive economic and societal impact.