Lagos Retains Top Spot for Ease of Doing Business — But Poor Internet Remains Its Biggest Weakness

Lagos has once again been ranked Nigeria’s best state for ease of doing business, according to the latest report from the Presidential Enabling Business Environment Council (PEBEC). The 2024 ranking reinforces the state’s long-standing reputation as the country’s commercial nerve centre — but also highlights a widening problem that threatens its competitiveness: digital connectivity.

Why Lagos Still Leads

PEBEC’s annual assessment focuses on how states simplify regulation, attract investment, and modernise government services. Since its launch in 2016, the council has pushed reforms like automated tax payments and digitised public services, aiming to reduce bottlenecks that frustrate businesses.

This year, the top five performers — Lagos, Kaduna, Oyo, the FCT, and Ogun — represent what PEBEC calls “a benchmark of what a competitive national economy could look like when reforms gain traction.”

Lagos distinguishes itself in several areas:

• Transport and logistics infrastructure
• Land administration and regulatory digitalisation
• A strong pipeline of tech talent and digital literacy
• A thriving innovation ecosystem, home to some of Nigeria’s most valuable startups, including major fintech and payments companies.

These strengths continue to position Lagos as Nigeria’s startup capital and a preferred destination for logistics and technology investment.

The Big Bottlenecks: Land Processing & Administrative Delays

Despite its strengths, Lagos still faces persistent hurdles:

• Slow land documentation and processing
• Right-of-way (RoW) charges
• Bureaucratic friction across certain regulatory agencies

These inefficiencies inflate the cost and time required to operate, particularly for SMEs trying to scale.

But the Biggest Problem Is Internet Connectivity

While Lagos has more fibre coverage than any other state — 7,864.5 km — the report notes that it needs over 30,000 km to achieve universal broadband access. Only core urban corridors enjoy stable connectivity, leaving many inner communities underserved.

The Ministry of Communications, Innovation and Digital Economy estimates that just 39% of Nigerians live within 5 km of fibre infrastructure, though Lagos performs better at 85%. Still, wide gaps remain.

These connectivity issues limit:

• E-commerce growth outside major hubs
• MSME access to digital markets
• Remote work productivity
• Data-driven business operations

PEBEC puts it plainly: better internet would directly boost business activity, SME expansion, and overall competitiveness.

What Lagos Is Doing — And What’s Missing

The state has made progress through the Lagos State Infrastructure Maintenance and Regulatory Agency (LASIMRA), which has already laid 6,000+ km of metro fibre. But this is still far below what is required for a modern digital economy.

The council recommends accelerating digital infrastructure rollout within six to 18 months to maintain Lagos’ competitive edge.

Touting, Loitering, and Security Gaps Still Affect Businesses

Beyond connectivity, Lagos continues to battle touting, informal tolling, and street-level disruptions in major commercial and logistics corridors. These issues:

• Create safety concerns
• Slow the movement of goods
• Discourage investors
• Reduce predictability for daily business operations

PEBEC suggests strengthening security and deploying real-time surveillance systems across key business districts.

States Lagging Behind

At the bottom of the ranking are Benue, Borno, and Zamfara, where years of conflict and insecurity have severely weakened economic competitiveness and service delivery.

The Big Picture

Despite its challenges, Lagos remains one of Nigeria’s most advanced business environments. Its blend of reliable electricity in certain zones, strong transport networks, improving digital services, functional land systems, and a skilled workforce positions it ahead of the pack.

But without major investment in internet infrastructure, the state risks slowing down the very economic engines — tech, logistics, fintech, e-commerce — that fuel its leadership.