Nigeria remains Africa’s largest economy and a hub for entrepreneurial growth. However, doing business in the country is not the same across all 36 states. Some states have made deliberate efforts to improve infrastructure, reduce bureaucratic bottlenecks, and attract investors, while others still struggle with poor governance and insecurity.
We highlight the 10 best business-friendly states in Nigeria, based on ease of doing business, tax policies, government policies, infrastructure, security, market opportunities, and economic potential. If you are an investor, entrepreneur, or business owner considering expansion, these states provide a fertile ground for growth.
1. Lagos State – Nigeria’s Commercial Capital
No list of business-friendly states in Nigeria is complete without Lagos. The state is the undisputed commercial nerve center of the country, contributing over 25% of Nigeria’s GDP.
Why Lagos is Business-Friendly:
- Huge Market Size: With over 20 million residents, Lagos offers an expansive consumer market.
- Financial Hub: Headquarters of top banks, fintechs, and insurance companies.
- Infrastructure: Major seaports, international airport, and extensive road networks.
- Innovation Ecosystem: Yaba is home to Nigeria’s “Silicon Valley,” where startups thrive.
Key Sectors:
Technology, real estate, shipping & logistics, financial services, entertainment, and manufacturing.
For investors, Lagos remains the number one destination despite challenges like traffic and high living costs.
Tax Climate in Lagos:
- PAYE (Personal Income Tax): Progressive rates up to 24%.
- Land Use Charge: Applied to property owners annually.
- Business Premises Levy: ₦10,000 (urban) and ₦5,000 (rural).
- Other levies: Signage, environmental charges.
Lagos has the most efficient tax administration in Nigeria (via LIRS e-filing), but the tax burden is heavier than in other states.
2. Abuja (Federal Capital Territory – FCT)
Abuja, Nigeria’s capital, is another hotspot for business opportunities. As the administrative seat of government, it attracts policymakers, foreign embassies, and global corporations.
Why Abuja is Business-Friendly:
- Stable Governance: Federal presence ensures better security and infrastructure.
- Accessibility: Nnamdi Azikiwe International Airport connects Abuja to major global cities.
- Rising Middle Class: Abuja has one of the highest average disposable incomes in Nigeria.
Key Sectors:
Real estate, construction, hospitality, ICT, and consulting services.
Abuja is particularly attractive for companies looking to engage with government institutions or offer services to high-net-worth individuals.
Tax Climate in Abuja:
- Personal Income Tax: Same national progressive rates, up to 24%.
- Business Premises Levy: ₦5,000–₦10,000.
- Other Levies: Advertising, signage, and waste collection.
Abuja has a moderate tax burden and more efficient tax administration compared to many states.
3. Ogun State – The Industrial Powerhouse
Ogun State has positioned itself as an industrial hub due to its proximity to Lagos. Many multinational and local companies have set up factories and warehouses here because of cheaper land and easier regulations.
Why Ogun is Business-Friendly:
- Industrial Clusters: Agbara and Ota house several manufacturing giants.
- Good Road Links: Easy access to Lagos and southwestern Nigeria.
- Government Support: Ogun State Industrial Policy actively promotes investment.
Key Sectors:
Manufacturing, agriculture, real estate, logistics, and FMCGs.
If you are in production or distribution, Ogun offers a cost-effective alternative to Lagos while still enjoying market access.
Tax Climate in Ogun:
- PAYE Tax: Progressive, up to 24%.
- Business Premises Levy: ₦2,000–₦5,000 depending on company size.
- Industrial Incentives: Some manufacturers enjoy tax holidays.
Ogun’s lower tax rates compared to Lagos make it attractive for industrial investment.
4. Rivers State – Gateway to the Oil and Gas Industry
Rivers State, with Port Harcourt as its capital, is the heart of Nigeria’s oil and gas sector. It is home to multinational oil companies, service firms, and related industries.
Why Rivers is Business-Friendly:
- Oil and Gas Hub: Headquarters of many international energy companies.
- Port Facilities: The Onne Port Complex is one of the largest in Africa.
- Skilled Workforce: A high concentration of oil and gas professionals.
Key Sectors:
Energy, shipping, construction, and professional services.
Despite occasional security concerns, Rivers State remains a strategic location for businesses targeting the oil economy.
Tax Climate in Rivers:
- PAYE: Up to 24%.
- Business Premises Levy: ₦10,000+ depending on company size.
- Other Levies: Heavy reliance on multiple charges, including environmental, signage, and development levies.
Rivers’ tax environment can be demanding, especially for oil-service companies, but incentives exist for manufacturing and SMEs.
5. Akwa Ibom State – Emerging Investment Destination
Akwa Ibom is fast becoming one of Nigeria’s most attractive states for investors, thanks to its peaceful environment and investment-friendly policies.
Why Akwa Ibom is Business-Friendly:
- Stable Power Supply: The Ibom Power Plant boosts electricity access.
- Infrastructure Growth: Ibom Deep Seaport and Ibom Air improve connectivity.
- Peace and Security: Ranked among the most peaceful states in Nigeria.
Key Sectors:
Aviation, agriculture, real estate, hospitality, and marine trade.
Akwa Ibom is a hidden gem for investors looking beyond traditional hubs like Lagos and Rivers.
Tax Climate in Akwa Ibom:
- PAYE: Up to 24%.
- Business Premises Levy: ₦5,000 for small businesses, higher for large firms.
- Incentives: Tax relief for aviation, shipping, and agribusiness investors.
Akwa Ibom offers moderate tax rates with strong incentives in strategic sectors.
6. Anambra State – The Trading Giant of the Southeast
Known as the commercial heartbeat of the Southeast, Anambra State thrives on trade, manufacturing, and entrepreneurship. The city of Onitsha hosts one of the largest markets in West Africa.
Why Anambra is Business-Friendly:
- Vibrant Market: Onitsha Main Market attracts traders across Africa.
- Industrial Growth: Nnewi is Nigeria’s hub for auto parts and light manufacturing.
- Enterprising Population: Strong culture of entrepreneurship.
Key Sectors:
Trade, manufacturing, auto parts, and consumer goods.
Anambra offers great opportunities for businesses targeting mass-market products.
Tax Climate in Anambra:
- PAYE: Up to 24%.
- Business Premises Levy: ₦2,000–₦5,000.
- Market Levies: Traders pay stall rents and local fees.
Taxation is lighter than Lagos, but informal levies exist in markets.
7. Kano State – Northern Nigeria’s Commercial Hub
Kano remains the business capital of northern Nigeria with centuries of history in trade and commerce.
Why Kano is Business-Friendly:
- Large Population: Over 13 million residents.
- Strategic Location: Serves as a trade route linking Nigeria to Niger, Chad, and other Sahel countries.
- Government Initiatives: Efforts to modernize markets and attract industries.
Key Sectors:
Agriculture, textiles, trade, and livestock.
For investors looking to access northern markets and cross-border trade, Kano is the gateway.
Tax Climate in Kano:
- PAYE: Up to 24%.
- Business Premises Levy: ₦2,000–₦5,000.
- Other Levies: Informal local government charges for traders.
Kano’s tax system is moderate, though local levies may increase costs for SMEs.
8. Delta State – Oil, Gas, and Beyond
Delta State is another oil-producing region with growing opportunities beyond petroleum. The government is diversifying into agriculture and technology.
Why Delta is Business-Friendly:
- Rich in Resources: One of the highest oil-producing states.
- Industrialization Drive: Establishment of industrial parks and free trade zones.
- Transport Infrastructure: Asaba Airport improves access to other regions.
Key Sectors:
Oil and gas, agriculture, real estate, and logistics.
Delta offers opportunities for businesses seeking to tap into both energy and non-energy sectors.
Tax Climate in Delta:
- PAYE: Up to 24%.
- Business Premises Levy: ₦5,000–₦10,000.
- Free Trade Zones: Companies in FTZs enjoy tax breaks.
Delta’s tax burden is heavier on oil companies, but non-oil firms benefit from incentives.
9. Enugu State – The Coal City’s Economic Revival
Enugu, once famous for coal, has reinvented itself as a center for commerce, education, and services.
Why Enugu is Business-Friendly:
- Stable Environment: Known for peace and relatively low crime.
- Growing Middle Class: Increasing demand for services and housing.
- Government Support: Investment-friendly initiatives like SME support programs.
Key Sectors:
Real estate, hospitality, education, ICT, and light manufacturing.
Enugu provides a fertile ground for SMEs and investors targeting the Southeast.
Tax Climate in Enugu:
- PAYE: Up to 24%.
- Business Premises Levy: ~₦2,000–₦5,000.
- Other Levies: Relatively fewer informal charges compared to Anambra.
Enugu offers a low-to-moderate tax environment, making it SME-friendly.
10. Kaduna State – Industrial and Agricultural Strength
Kaduna is one of the most industrialized states in northern Nigeria. With its location and resources, it is a strong business hub.
Why Kaduna is Business-Friendly:
- Strategic Location: Links northern and southern Nigeria.
- Industrial Base: Hosts textile factories, manufacturing plants, and agro-processing industries.
- Agricultural Resources: Strong in crops like maize, ginger, and soybeans.
Key Sectors:
Agriculture, manufacturing, education, and ICT.
Kaduna State continues to attract investors through proactive policies and industrial expansion.
Tax Climate in Kaduna:
- PAYE: Up to 24%.
- Business Premises Levy: Around ₦5,000.
- Incentives: State offers tax holidays for agribusiness and ICT investors.
Kaduna provides a competitive tax environment to attract industries.
Nigeria is a land of opportunities, but some states are more business-friendly than others. Lagos, Abuja, Ogun, and Rivers remain the top choices for major corporations, while states like Akwa Ibom, Anambra, Kano, and Kaduna are emerging as strong contenders for investors seeking growth markets.
When choosing where to invest, consider market size, infrastructure, government support, and security. The 10 best business-friendly states in Nigeria highlighted above provide fertile ground for entrepreneurs and established firms alike.