Nigeria’s entrepreneurial climate showed a mild improvement in 2025, according to new data released in the Fate Institute’s State of Entrepreneurship in Nigeria Report, which evaluated 10,882 businesses across the 36 states and the FCT. The report placed the country’s State of Entrepreneurship Index at 0.47, up from 0.46 in 2024, reflecting what the Institute described as a “modest but consistent” rise in entrepreneurial activity since measurements began in 2001.
The annual publication provides a comprehensive examination of the business environment, with a special focus on female- and youth-led enterprises, job creation trends, operational constraints, emerging opportunities and policy pathways to strengthen Nigeria’s enterprise ecosystem.
Government Says MSMEs Are “Holding Up the Economy”
Speaking during the report’s presentation at the 11th Policy Dialogue Series (PDS) on entrepreneurship, Minister of State for Industry, Trade and Investment, Senator John Enoh, stressed that Nigeria’s economy owes much of its stability to the resilience of micro, small and medium enterprises.
According to Enoh, “the only reason Nigeria’s economy has not collapsed is because of the resilience of MSMEs,” noting that the country cannot build a competitive industrial economy without ensuring that entrepreneurs have reliable access to growth capital.
He acknowledged that the government “still has so much to do” for the sector but praised the ingenuity and persistence of small businesses, which he said have continued to innovate despite financial and operational constraints.
“The more the government pays attention to this ecosystem, the more it responds to the challenges MSMEs face, the more we can breathe new life into the sector,” Enoh stated. “MSMEs represent the energy, creativity and demographic power of the nation. They make up 96 percent of all businesses, and these numbers remind us that Nigeria’s economic destiny rests on the success of its entrepreneurs.”
Calls for an Industrial Environment Where MSMEs Can Scale
The minister reiterated the administration’s ambition to build an industrial economy anchored on strong manufacturing, scalable enterprises and youth-driven innovation.
“We are working toward an economy where MSMEs do not struggle to survive, but scale; where manufacturing grows rather than shrinks; and where youth enterprise becomes a source of national strength, not frustration,” he said.
FATE Foundation Flags Tax Complexity as Persistent Burden
Earlier, Fola Adeola, Founder and Chairman of FATE Foundation, emphasized the organisation’s longstanding advocacy for a simpler and more transparent tax framework for MSMEs. He said data from the Institute repeatedly shows that administrative bottlenecks and complex tax procedures disproportionately constrain micro-businesses and impede urbanisation.
Adeola urged policymakers to treat tax reform as a priority lever for improving business competitiveness and unlocking sustainable job creation.