Tuesday, 31 July 2018

What did the new 2018 CAMA bill lack?

Hello Everyone,

Today is Tuesday and you know what we do every tuesday!!!

Business and the State Tuesdays. Yippee!

It's funny right, Earlier I had written recent post that highlighted the benefits of the new 2018 CAMA bill that reduced the barrier of registering a company by young Entrepreneurs but through discussions with small business owners the feeling all around is that, the bill is merely a plastic bill.

This is how most startup/small business still feel despite the bill that the Senate felt was going to be the breakthrough for startups in Nigeria. Little do they know that this is what young Entrepreneurs feel about it.

In one Entrepreneur's words, 

"They made it easier for them to kill many more businesses"

Take for example my situation. We decided to be more in control and launch a mini-fleet to handle deliveries especially when we can't find partners handle deliveries. Below is a list of government charges that we would be expected to pay if we launch that service.

a. NIPOST license fee: N1.5million
b AEPB (FCTA) charge: N30,000 annually

Still there are risks that their task force agents would stop our riders on the road and ask for tips as they ride past.

Probably N100 or more every day.

We had rather build a platform that leverages on existing delivery providers that go and join them in the struggle. 

But now we might decide to have black man blood and die on the line with the government agencies that are out to kill us.

Let us not talk about the fact that startups typically don't have access to bid for government contracts which has been highlighted in this article by Techpoint.ng

The truth is the same things apply to other startups in other sectors. In Nigeria, we all know that government is the highest payer and most times referred to the 'cash cow' for most businesses that have been able to grow and scale.

For HubbonNG we are faced with these challenges

1. 3 years tax clearance + documentation and fees for different bodies (NSITF, ITF, BPP) all of which come with adjoining costs.
2. Tender Bids. These usually costs from N50,000 to N1million or higher based on the complexity of the jobs that the companies are being considered for.
3. Long terms of payments. One of the most important aspects of running a startup is cash flow and government contracts are paid after a protracted period of time.

These bottlenecks serve as deterrents for startups. I mean. Is it not better to deal with small customers that pay as at when due compared to a government that would now tell you that you payment documents have gotten lost.

One other challenge that a small business owner presented to me whilst in a discussion;

"The Nigerian Government speaks about wanting to create jobs. Small businesses serve as the highest employers of labour, but they do not even give us a chance to grow our businesses enough to employ staff before placing taxes, tariffs, market fees and all that and a lot of us end up with constricted business models because there was not enough time to gain a sustainable market share."

That speaks a lot to the lack of vision by the government because if you have plans to grow your economy and build the number of businesses in your country and employ people. You need to create an enabling environment. But these two aspects that are the most necessary to this enabling environment have yet to be addressed.

1. Multiple Taxation (FIRS, LG charge, State Taxes, Market Tariffs, Association fees etc)
2. Access to credit (most facilities for loans for business owners usually start from 20% and for small businesses they usually pay off their loans and most likely don't manage to grow their startups. Loans from agencies like the BOI usually have protracted processes and it discourages Entrepreneurs.

I remember  during the "Senate Roundtable Discussion on Youth Unemployment and Development in Nigeria" that we had with the Senate President, His Excellency Bukola Saraki and other senators, I had mentioned these challenges as the bottlenecks that youth have starting businesses that has given rise to the huge drive towards government employment as it provides the opportunity to get lifetime income and do little to no work.

Whenever we look at Nigeria and its challenges to creating an enabling environment for business owners, we are easy to castigate the government and hurl all sorts of discontentment on social media.

But the question here is,


You can shout on social media, but let us be honest, the people that make the important decisions about our businesses are not on social media. The avenue where we get to share our ideas and displeasure on wrong bills is through STAKEHOLDER ENGAGEMENT.

Most bills that are presented in front of the National Assembly usually have a public hearing and this is where CSO's, agencies, private sector and other stakeholders come to share their thoughts which would influence how the legislators perceive the effect that the bill would have if implemented and necessary adjustments would be made or the bill would be scrapped altogether.


We must be deliberate!

As this young man says, we can't get better one time. We have to step up, to step up, to step up!.

Let's hear your ideas on what the CAMA bill lacked and in what ways do you think that the Nigerian Government can improve the enabling environment for your business to thrive in Nigeria. Leave us a comment and we would be sure to respond to you. Share to your networks as well.

Before I go, remember if you run a business and you are looking to promote it. You can sign up on the HubbonNG Business Listing Platform here. It is for FREE!

Thanks for reading. I hope you enjoyed reading this post as much as I enjoyed writing it. Have a good one!

Best regards,
Ejieji Muna
(Co-founder, HubbonNG)

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