Nigeria Operational Risk Report

Providing expert analysis on the risks and opportunities, examining the threats stemming from the labour market, logistics infrastructure, trade & investment regulations and crime & security.

Report covers 4 key areas of risk: Labour Market Risk, Logistics Risk, Trade and Investment Risk, and Crime and Security Risk.

Why you should buy this report

  • Understand the capabilities of the workforce  in order  to guard against any issues that might impact your business
  • Know the strengths and weaknesses of the country’s supply chain and utilities infrastructure and how this would support or challenge your operations
  • Evaluate how trade restrictions and investor-focused  legislation could present problems for your company
  • Gain insight on the greatest crime and security threats to your staff and business operations in the country.
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Nigeria Operational Risk Report
Product Price
$1,585.00

The first published edition of the Nigeria Operational Risk Report provides investors with detailed insight on the practicalities and major risks of operating in Nigeria, whilst also comparing the country to the wider region.

The report examines the threats posed by the labour market, logistics infrastructure, trade & investment regulations and crime & security, providing an essential tool when operating in or looking to operate in the market.

Key Uses of the Report:

  • Labour Market Risk: Understand the capabilities of the workforce in order to guard against any issues that might impact your business
  • Logistics Risk: Know the strengths and weaknesses of the country’s supply chain and utilities infrastructure and how this would support or challenge your operations
  • Trade and Investment Risk: Evaluate how the trade restrictions & investor-focused legislation could present problems for your company
  • Crime and Security Risk: Discover the greatest threats to your staff and business operating in the country

The Nigeria Operational Risk Report by Business Monitor includes four major sections covering Labour Market Risk, Logistics Risk, Trade and Investment Risk and Crime and Security Risk.

Labour Market Risk:

What are the main risks to operating in Nigeria posed by the labour market?
The Report assesses the labour market risks facing businesses and investors in Nigeria regarding the availability and qualifications of the labour force and potential costs stemming from overregulated or restrictive labour markets.

Availability of Labour: This segment analyses the main risks facing businesses regarding the size of the labour force.

These include overall employment, female participation, life expectancy, demographic population deployment and forecasts for workforce size by sector. It also evaluates the basic skill set of the workforce, literacy and numeracy rates, and the quality of the primary educational infrastructure, compared with the wider region.

Education: Assessing the potential pressures facing businesses requiring a skilled labour force with secondary or tertiary education qualifications. This covers the quality, density and graduation rates for both secondary and tertiary education, with a particular focus on engineering, science, mathematics and technological graduates.

Labour Costs: This covers the challenges presented by regulations governing labour taxes, minimum wages, annual leave, severance pay, and foreign worker visas. It assesses the costs of employment that face businesses and investors. It also evaluates risk stemming from unionisation and strike activity, and the comparative rigidity of the labour market around regulations concerning the racial and gender demographic requirements for employment.

Key Benefits:

  • Evaluate Nigeria’s labour market risk profile against its regional peers and by 170 states globally, helping you understand the size, education and rigidity of the labour market in relation to other markets.
  • Guard against risks posed by a limited skilled labour pool, high costs and limited labour market flexibility, and the potential risks and costs associated with the importation of foreign skilled labour.

Logistics Risk:

What are the main risks to operating in Nigeria posed by the logistics and utilities?
The Report analyses the logistics risks facing Nigeria’s supply chains, utilising the Business Monitor Logistics Risk Index that compares levels of risk across 170 states worldwide.

Transport Network – This section assesses the extent and quality of Nigeria’s transport system broken down by mode, with supporting analysis on specific transport challenges such as congestion and underdeveloped infrastructure.

Trade Procedures and Governance – Providing ease of trading benchmarking, as well as analysis evaluating trade bureaucracy and its impact on import and export costs and lead times, and Nigeria’s level of connectivity to international trade routes.

Market Size and Utilities – Looking at the growth outlook of the market and the pressure this will place on the country’s supply chains. Providing analysis of utility costs and availability in Nigeria and their impact on sector specific supply chains.

Key Benefits:

  • Compare the supply chain risks between developing manufacturing hubs and commodity producing nations, by benchmarking Nigeria’s logistics risk profile against regional peers and by 170 states globally.
  • Prepare your company for any supply chain challenges as you expand your existing operations within Nigeria or consider moving into the market for the first time.

Trade and Investment Risk:

What are the main risks to operating in Nigeria posed by trade and investment?
The Report assesses the trade and investment risks facing businesses and investors in Nigeria via insights into FDI flows, key import and export markets, government intervention, taxation, and the development of the legal system.

Economic Openness: This segment presents the risks posed to businesses and investors looking to enter the country, assessing its overall openness to foreign direct investment, and attractiveness as an investment destination compared with its regional peers. The Report highlights key investment opportunities in specific sectors, and evaluates trade flows, main trading partners and products. It also analyses the development of the financial market, the density of the banking sector, availability of credit, and the sophistication of the market.

Government Intervention: Highlighting key risks stemming from the taxation system, to both resident and non-resident companies and individuals, together with a breakdown of the tax requirements. It also evaluates potential risks posed by the bureaucratic requirements surrounding businesses.

Legal Risk Analysis: Covering the observance of the rule of law and corruption, this section evaluates the main risks that investors and businesses face from the enforceability of contracts, together with property and intellectual property protection rights. It also assesses e-governance development and governmental transparency.

Key Benefits:

  • Benchmark Nigeria’s trade and investment risk profile against its regional peers and by 170 states globally, allowing easy comparison of investment and trade flow risks between markets.
  • Identify, evaluate and anticipate risks posed by financial market sophistication, favourable tax regimes and the comparative development of the legal system.

Crime and Security Risk:

What are the main risks to operating in Nigeria posed by crime and security?
The Report examines the crime and security risks faced by foreign business travellers and other expatriates in Nigeria, utilising the Business Monitor Crime and Security Risk Index of 170 states worldwide.

Criminal Risks – This section looks into the risks faced by foreign business travellers and expatriates from a full range of crimes, including petty crimes and nuisances, scams, assault, murder, kidnapping, and cyber crimes. It also examines the risks to foreign businesses from organised crime, and the competence and the reliability of local law enforcement agencies.

Terrorism Risks – Looks at the risks of a terrorist attack or major acts of political violence, based on the size, motivations, geographic spread, and capabilities of terrorist/extremist groups. It also assesses the country’s attractiveness as a target, transit point, or safe haven for international terror groups. The Report also looks at the effectiveness of Nigeria’s counterterrorism forces.

Interstate Security Risks – This section assesses the likelihood of the country becoming embroiled in international conflict, based on its existing and anticipated international disputes, bilateral and multilateral dispute resolution mechanisms, and any military alliances it has. It also assesses the country’s military capabilities in relation to potential aggressors.

Key Benefits:

  • Contrast the criminal, terrorism and interstate security risks of Nigeria against its regional peers and in relation to 170 states globally.
  • Protect your business against the threats of crime, terrorism, and international conflict when deciding whether to expand your existing operations in Nigeria or move into the market for the first time.
BMI View
7
Table: Nigeria- Operational Risk
10
SWOT
11
Operational Risk SWOT
11
Labour Market Risk
13
BMI View
13
Table: Nigeria - Labour Market Risk
15
SWOT
16
Education Analysis
18
Education
18
General Education
19
Tertiary Education
26
Availability of Labour Analysis
30
Availability of Labour
30
Size Of Labour Force
31
Composition Of Labour
34
Table: Nigeria - Top 9 Immigrant Sources, 2015
38
Labour Costs Analysis
39
Labour Costs
39
Cost And Flexibility Of Labour
40
Table: Nigeria - Labour Regulations Governing Flexibility Of Workforce
44
Logistics Risk
45
BMI View
45
Table: Nigeria - Logistics Risk
47
SWOT
48
Market Size and Utilities Analysis
50
Market Size And Utilities Availability
50
Utilities Cost And Reliability
52
Electricity
53
Table: Electricity Risks
54
Fuel
56
Table: Fuel Risks
57
Telecommunications
59
Table: Telecommunications Risks
60
Water
62
Table: Water Risks
63
Transport Network Analysis
66
Extent And Quality Of Transport Network
68
Table: Road Risks
69
Table: Rail Risks
73
Table: Ports and Inland Waterways Risks
76
Table: Air Transport Risks
79
Trade Procedures and Governance Analysis
81
Trade Procedures And Governance
81
Ease And Costs Of Trade
83
Table: Export And Import Procedures
84
Table: Trade Procedures and Governance Risks
85
Trade and Investment Risk
86
BMI View
86
Table: Nigeria - Trade And Investment Risk
88
SWOT
89
Economic Openness Analysis
91
Table: Nigeria - Top Five Import Products & Import Partners, 2010 - 2014, USDmn
98
Table: Nigeria - Free Trade Agreements
100
Investment Openness
100
Table: Nigeria - Free Trade Zones And Investment Incentives
105
Government Intervention Analysis
106
Taxation
107
Table: Nigeria - Business Taxes
108
Table: Nigeria - Personal Income Tax
109
Fiscal Barriers
110
Legal Environment Analysis
116
Bureaucratic Environment
117
Table: Lagos - Bureaucratic Procedures
118
Legal Environment
119
Crime and Security Risk
125
BMI View
125
Table: Nigeria - Crime And Security Risk
127
SWOT
128
Conflict Risk Analysis
130
Terrorism And Political Violence
132
Table: Main Active Terrorist Groups In Nigeria
132
Interstate Conflict Risk
136
Table: Major Conflict Flashpoints
136
Vulnerability To Crime Analysis
140
Violent And Petty Crime
142
Capability Of The Police Force
144
Business Crime Analysis
146
Financial Crime And Cybercrime
147
Business Costs Of Crime
151
Table: Business Response To Risk In Nigeria
153
Methodology
155
Table: Operational Risk Pillars, Weighting (%)
155
Table: Weighting Of Indicators (%)
158