WHY STARTING A BUSINESS IN AMERICA IS BETTER OFF THAN IN NIGERIA

 

Introduction

In today’s global economy, the idea of starting a business is becoming increasingly popular. With the rise of entrepreneurship, people are seeking opportunities to create their own ventures and become self-reliant. However, the decision of where to start a business is crucial, as it can greatly impact the success and growth of the business. In this thesis, we will explore the reasons why starting a business in America is better off than in Nigeria.

Economic Stability and Growth

One of the main reasons why starting a business in America is better off than in Nigeria is due to the economic stability and growth of the country. America has a well-established and stable economy, with a GDP of over $22 trillion in 2019, making it the largest economy in the world. This stability creates a favorable environment for businesses to thrive, as there is a high demand for goods and services. Moreover, the American economy has been growing consistently, providing a steady market for businesses to operate in.

On the other hand, Nigeria has experienced significant economic instability over the years. The country heavily relies on oil exports, making it vulnerable to fluctuations in oil prices. This has resulted in a volatile economy with a fluctuating GDP, making it challenging for businesses to sustain growth and profitability. This economic instability also leads to a high level of uncertainty, making it risky for entrepreneurs to invest in the country.

Ease of Doing Business

Another factor that makes America a better place to start a business is the ease of doing business. According to the World Bank's Ease of Doing Business Index, America ranks 6th out of 190 countries, while Nigeria ranks 131st. This indicates that America has a more business-friendly environment, with fewer bureaucratic hurdles and more efficient processes for starting and running a business. In America, it only takes six days to register a business, compared to the 30 days it takes in Nigeria. This streamlined process reduces the time and resources required to set up a business, making it more attractive for entrepreneurs.

Access to Capital and Resources

Starting a business requires significant capital and resources, and America offers better access to these than Nigeria. The American financial system is well-developed, with a robust banking sector and a variety of financing options for businesses, such as loans, venture capital, and angel investors. Additionally, America has a developed stock market, providing businesses with an avenue to raise capital through public offerings. These resources are essential for businesses to grow and expand, and the ease of access to them makes America a more favorable destination for entrepreneurs.

In contrast, Nigeria's financial system is underdeveloped, with limited access to capital and resources for businesses. The country has a high interest rate, making it expensive for businesses to borrow money. Moreover, the lack of a well-developed stock market makes it challenging for businesses to raise capital through public offerings. This lack of access to capital and resources can hinder the growth and expansion of businesses in Nigeria.

Political and Social Stability

The political and social climate of a country is crucial in determining its suitability for starting a business. America prides itself on its stable political and social system, which creates a conducive environment for businesses to operate in. The country has a strong rule of law and a well-established legal system, providing businesses with a sense of security and protection of their rights. Additionally, America has a diverse and educated population, providing businesses with a skilled workforce to choose from.

In contrast, Nigeria has a history of political and social instability, with frequent coups and civil unrest. This instability creates a sense of uncertainty for businesses, making it difficult for them to plan for the future. Additionally, the country has a high level of corruption, which can hinder the growth and success of businesses. Moreover, Nigeria's education system is still developing, leading to a shortage of skilled workers, which can be a challenge for businesses.

Conclusion

In conclusion, starting a business in America is better off than in Nigeria due to its stable and growing economy, ease of doing business, access to capital and resources, and political and social stability. While Nigeria offers its own opportunities for entrepreneurs, the challenges and limitations mentioned above make America a more attractive destination for starting a business. As the global economy continues to evolve, it is essential for entrepreneurs to carefully consider the location of their business to ensure its success and growth.