Economic Freedom & Entrepreneurship: The Missing Link in Nigeria’s Democratic Progress By Dr. Abiola Salami, Worldclass Performance Strategist
On June 12, Nigerians commemorate Democracy Day—a tribute to the 1993 election that many regard as a symbol of the people’s will. It was a moment when Nigerians, across tribal and regional lines, chose hope over despair, unity over division. Yet, more than three decades later, the average Nigerian is left wondering: Where is the dividend of democracy?
Sure, we vote. Sometimes. We have multiple political parties. We’ve transitioned from military rule to civilian government. But democracy was never meant to be just about political rituals. At its heart, democracy promises freedom, dignity, and opportunity. It is not just to speak or vote, but to thrive economically.
And that’s where Nigeria needs urgent and serious attention.
While democracy has made limited gains in governance structures, it has largely bypassed the economy. Too many entrepreneurs are trapped in a web of bureaucratic red tape, erratic policies, inflation, and unreliable infrastructure. Career professionals face stunted mobility, underemployment, and wage stagnation despite degrees and drive.
This week we are making a provocative argument that without economic freedom for the most of us, democracy is incomplete for all of us. And for Nigeria to fulfill its democratic promise, we must place entrepreneurs, job creators, and innovators at the center of national development; not as political ornaments, but as economic engines.
What Is Economic Freedom, and Why Does It Matter for Democracy?
Economic freedom means individuals and businesses have the right to:
- Choose how they work, produce, consume, and invest
- Access and protect property and capital
- Operate with minimal interference from government
- Engage in trade without undue restriction
Countries with higher levels of economic freedom consistently rank higher in democratic stability, income levels, innovation, and quality of life.
| Country | Economic Freedom Index (2024) | Democracy Index (2024) | GDP per Capita (USD) |
| Singapore | 1st | High | $88,000 |
| New Zealand | 2nd | High | $53,000 |
| Nigeria | 124th | Hybrid regime | $2,200 |
Source: Heritage Foundation, Economist Intelligence Unit, World Bank
Nigeria has the population (220M), resources (oil, gas, arable land), and youth (median age: 18.1). But it remains one of the most difficult countries in the world to start and scale a business. This contradiction undermines not only the economy but democracy itself. When citizens are economically trapped, they become politically disengaged. Because why vote if your circumstances don’t change?
Entrepreneurship is the Heartbeat of Democratic Economies
In democratic nations, entrepreneurs are not just wealth creators; they are freedom creators. By building alternatives to state monopolies, generating employment, and innovating solutions to social problems, they expand what’s possible for society.
In 1776, the same year America declared independence, Adam Smith published The Wealth of Nations, linking economic choice to political liberty. His thesis? Free people must be able to choose their economic destiny. That truth still holds.
In Estonia for example, entrepreneurship helped solidify democracy by delivering prosperity. After breaking from the Soviet Union, Estonia launched radical reforms to simplify business registration, digitize government, and encourage startups. In less than 20 years, it became Europe’s digital hub, with over 1,000 startups—including Skype.
“Democracy Without Prosperity Is an Empty Promise”
Nigerian Entrepreneurs are in a Straitjacket
Nigerian entrepreneurs are not lazy. They are not risk-averse. They are fighting an uphill battle against a system that frustrates initiative. The barriers to Economic Freedom have put Nigerian Entrepreneurs in a Straitjacket
Key challenges include:
- Overregulation: Multiple taxes, agency fees, and compliance demands (e.g., NAFDAC, SON, CAC, FIRS, ARCON, LIRS etc).
- Policy Flip-Flops: Sudden currency devaluations, import bans, and subsidy removals with no warning.
- Infrastructure Gaps: Poor electricity supply, bad roads, and unreliable broadband.
- Funding Bottlenecks: Lack of access to affordable loans or venture capital.
Data Snapshot
- Nigeria ranks 131st out of 190 in the World Bank’s Ease of Doing Business Index.
- Over 70% of SMEs die within 5 years, largely due to systemic constraints (PwC Nigeria, 2023).
- More than 60% of youth-run businesses cite policy uncertainty as their biggest obstacle.
Amaka, a fashion entrepreneur in Onitsha, paid local government tax, environmental levy, sanitation fee, signage permit, trader’s permit, market union dues, and a daily kiosk fee. None came with official receipts. She closed her business after 18 months. This is not democracy. It’s economic suffocation.
When Democracy Ignores Entrepreneurs, It Starves the Nation
In 2023, Nigeria recorded an unemployment rate of 33%, with youth unemployment exceeding 40%. These are the same young people who stormed the streets during #EndSARS—angry not just at police brutality, but at economic stagnation.
A government that fails to empower its entrepreneurs cannot sustainably employ its youth. Public jobs are limited. Oil revenue is volatile. Only private-sector growth, led by MSMEs, can absorb our population boom. We need young people to participate in the electoral process. However, unemployed youth will become disillusioned voters.
History presents us with parallels on how economic hardship leads to democracy breakdown. In the 1930s, Germany recorded massive inflation and unemployment post-WWI which gave rise to authoritarianism. In the early 2000s despite its oil wealth, economic mismanagement turned Venezuela from democracy to dictatorship. The lesson is simple: starve people of opportunity, and democracy collapses into desperation.
The Critical Role of Entrepreneurs in Strengthening Democracy
Rather than being victims of a broken system, entrepreneurs can be architects of democratic renewal by:
1. Demanding Better Policies
Entrepreneurs can join or form coalitions that advocate for simplified taxes, transparent procurement processes, policy consultation before rollout and much more.
2. Creating Equitable Business Models
Entrepreneurs can build businesses that share prosperity—through local hiring, upskilling, profit-sharing, or inclusive ownership.
3. Invest in Civic Education
Entrepreneurs can support or launch platforms that teach youth about economic rights, governance, and financial literacy.
4. Engage in Policy Dialogues
Entrepreneurs can attend town halls, submit policy memos, join chambers of commerce, or participate in business councils.
One of Nigeria’s largest fintech, Flutterwave, routinely engages regulators and pushes for pro-innovation policies. By operating transparently and globally, it forces local regulators to evolve.
Entrepreneurs who sit outside governance risk being ruled by those who don’t understand their world.
Government’s Role in Enabling Economic Democracy
If we accept that economic freedom is the foundation of political freedom, then governments must act accordingly.
Key Enablers
- Simplify Regulations: Collapse overlapping agencies into one-stop hubs. Adopt tech for registrations and filings.
- Protect Property Rights: Strengthen legal systems to prevent land grabs, IP theft, and contract breaches.
- Fix Infrastructure: Electricity is not a luxury. Roads are not favors. Broadband is not optional.
- Access to Credit: Partner with banks and fintechs to unlock low-interest loans for MSMEs.
- Stable Policy Environment: No more midnight bans, contradictory memos, or arbitrary taxation.
Rwanda business reforms presents us a model to emulate. In less than a decade, Rwanda moved from post-genocide chaos to 2nd in Africa for ease of doing business by slashing red tape, digitizing services, and actively courting investors. Nigeria can do this and more if political will meets economic vision.
Corporate Nigeria Are Not Off the Hook
Large organizations must go beyond CSR and start driving systemic change. What Can Big Businesses Do? You can:
- Sponsor Incubators and Accelerators
- Mentor SMEs in Your Supply Chain
- Fund Advocacy Research
- Push for Better Economic Policies
- Invest in Local Content Development
See what Alhaji Aliko Dangote’s Local Sourcing Shift has done for the nation. By investing in Nigerian-made materials, Dangote Industries reduced import dependence, created jobs, and bolstered local suppliers.
Corporate Nigeria must collectively move from exploiting the system or to helping to fix it. The latter ensures long-term profitability and national stability.
Conclusion
Democracy is not yet uhuru without economic liberation. We cannot continue to celebrate Democracy Day while sidelining the economic engines of democracy. Political liberty without economic agency is a cruel joke—especially in a nation teeming with youth, talent, and hustle.
If Nigeria wants to secure its democratic future, it must unlock the economic potential of its people not through handouts, but through freedom. Therefore, Entrepreneurs must stop waiting for rescue and begin shaping the narrative. Professionals must stop whispering about policies in the breakroom and start organizing for reform. Governments must shift from being roadblocks to being runways for business growth.
Action Points for Entrepreneurs & Professionals
- Join a policy advocacy network (e.g., NESG, SMEDAN business groups)
- Educate your team and customers about economic rights
- Document your business challenges and send them to your representative
- Hold local government accountable for multiple taxation and illegal levies
- Mentor a younger entrepreneur to build resilience in the ecosystem
Further Reading & Resources
- Heritage Foundation: 2024 Economic Freedom Index
- PwC Nigeria: MSME Sector Performance Report (2023)
- World Bank: Doing Business in Nigeria
- Center for Democracy & Development: Democracy and the Economy in Africa
- Adam Smith: The Wealth of Nations
- EIU Democracy Index: Nigeria Country Report
Next Steps
We are happy to work with the government and other well meaning organizations to ensure economic freedom for Nigerians, contact us on +2347026668008 or hello@abiolachamp.com
About Dr. Abiola Salami
Dr. Abiola Salami is the Convener of Dr Abiola Salami International Leadership Bootcamp ; The Peak PerformerTM Festival Made4More Accelerator Program and The New Year Kickoff Summit. He is the Principal Performance Strategist at CHAMP – a full scale professional services firm trusted by high performing business leaders for providing Executive Coaching, Workforce Development & Advisory Services to improve performance. You can reach his team on hello@abiolachamp.com and connect with him @abiolachamp on all social media platforms.
