Entrepreneurial activity in Nigeria slowed down in 2024 as fewer individuals ventured into new business creation.
Data from the 2024 State of Entrepreneurship (SoE) Report released by Fate Foundation revealed that the business birth rate dropped to 24% in 2024, compared to 30% in 2023 and 32% in 2022.
“In 2024, the business birth rate in Nigeria fell to 24%, from 30% in 2023 and 32% in 2022,” the report stated.
The study highlighted that most Nigerians pursue entrepreneurship out of necessity, primarily to supplement income.
Notably, Anambra and Ebonyi topped the 2024 rankings with an entrepreneurship index of 0.77, significantly higher than the national average of 0.46.
“In 2024, Anambra and Ebonyi states led the rankings with a score of 0.77. This is significantly above the average index of 0.46,” the report stated.
Both states performed strongly in new business registrations, youth and women-led ventures, and financing access. Kogi, Kwara, and Oyo followed, while only Kogi retained its position from the previous year’s top five states. Niger, Cross River, and Zamfara ranked lowest.
The report also noted that 20 states slipped in performance compared to 2023, while 15 improved. Plateau and Zamfara maintained the same positions.
Despite the decline in overall business creation, female participation grew. Women accounted for 47% of new businesses in 2024, up from 42% the previous year.
“The share of female-led enterprises has been rising steadily over the last three years, from 43% in 2021 to 48% in 2024,” the report noted.
However, women entrepreneurs were more exposed to economic shocks. “In 2024, 63% of female-led businesses reported growth, a decrease from 74% in 2023 and slightly lower than the 64.3% for male-led businesses,” the report stated.
Anambra, Ebonyi, and Ogun recorded the highest growth for female-run enterprises, aided by expanding markets and technology adoption, but funding access remained the biggest hurdle.
Key challenges facing entrepreneurs in 2024 included:
Limited access to financing
Poor electricity supply
Insecurity
Exchange rate instability
Weak infrastructure
“In 2024, the top five most problematic factors for entrepreneurs included limited access to finance, poor power supply, insecurity, foreign exchange difficulties, and infrastructure challenges,” the report stated.
Even so, optimism prevailed: 87% of entrepreneurs expressed confidence in future opportunities, slightly higher than the 86% recorded in 2023. However, only 68% planned to expand operations in 2024, down from 78% the previous year.
The report called on the government to:
Maintain macroeconomic stability
Promote non-oil exports
Recapitalise development finance institutions
Support women and youth through incubators
Simplify business registration
Encourage public-private dialogue for policy reforms
