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Co-funded by the European Union

Inclusive Strategies: A Path to Sustainable Growth in Nigeria

Kaduna State is leading the design and implementation of an innovative policy strategy that can contribute to the Nigeria Agenda 2050 objectives of reducing poverty and inequality and enabling a diversified private sector led economy. This policy will enable a conducive business environment to foster the development of Inclusive Business models.

Inclusive Businesses (IBs) are “businesses that provide goods, services, and livelihoods on a commercially viable basis, either at scale or scalable, to people at the base of the economic pyramid, making them part of the value chain of companies’ core business as either suppliers, distributors, retailers, employees or customers”.

Addressing the key socio-economic challenges faced by Nigerians requires both the inclusion of those at the bottom of the pyramid into the economy, and the involvement of the private sector in the country’s’ development goals. Without public-private collaboration, targets will be harder to achieve, and without the inclusion of the most vulnerable, such goals will not be met.

The stakes are high, the potential is great

Nigeria is Africa’s largest market. With a population of around 200 million (61% of which are under  25 years old) it is known for its vibrant SME sector which contributes to almost 50% of the country’s  GDP and 75% of employment. However, Nigeria  still faces significant inequalities, with high levels of poverty (over 40% live below the poverty line), limited representation and economic opportunities for women, and substantial youth unemployment. Its largely oil-dependent economy will benefit from a diversification towards more sustainable and growing sectors, such as renewable energies, fintech, health tech and the creative industry, where many inclusive businesses can be identified. IBs represent an opportunity for Nigeria to drive a more sustainable growth that is private-sector-led, inclusive of  the poor, women, and other vulnerable groups, and that leverages  its young andvibrant entrepreneurship sector.

There is momentum for Inclusive Businesses

There is a growing interest in new kinds of entrepreneurs who are aiming to do good and do better. These entrepreneurs are addressing some of the most pressing social problems through innovative and scalable models and including the most vulnerable into their value chains, all while pursuing financially viable business ideas. Globally, governments are also aiming to drive economic growth and achieve positive social impact by designing and implementing policies that enable a conducive business environment for IBs.

A Gender and Youth focus will accelerate the full potential of the IB Strategy

The inclusion of the poorest and most vulnerable, including women and the youth, represents a critical opportunity for Nigeria’s economy. Investing in women can be a great economic driver: closing gender gaps while investing into the female economy (products and services that benefit women) means tapping into the world’s largest emerging market. Investing in Nigeria’s youth and enabling the environment for their inclusion into innovative sectors can leverage the enormous potential of this population. Net, IBs can be a catalyst for women’s economic empowerment and job creation for the youth, advancing gender equality and youth development.

Kaduna State takes the lead of Inclusive Businesses in Nigeria

Following up on the recommendations set out in the 2021 Landscape Study by the inclusive Business Action Network on Kaduna state, the Kaduna Development and Investment Promotion Agency, KADIPA, with the support of the ICR Facility, led a six-month collaborative process involving different public-private partners with the objective of designing their first Inclusive Business Strategy Document. The stakeholders’ engagement, support and participation were  essential during the drafting of  this document, while the leadership, expertise and commitment shown by the KADIPA team ensured  a successful coordination of the ecosystem, resulting  in a sound participatory IB Policy strategy. Ready for implementation, it has set the national scene on inclusive businesses. Crucial for  future scale up will be government support on regulations and policies for IBs and securing public-private funding to sustainably enact the strategy’s vision

From Blueprint to Federal Upscaling

Transitioning from Kaduna’s blueprint to action will require engaging national experts, refining essential elements, and defining realistic timelines. The team has successfully set in motion discussions with the Nigeria Investment Promotion Council, NIPC, to scale up the strategy to the federal level. The scaling proposal highlights short-term actions: building awareness, advocacy and expertise around IBs, as well as introducing enabling policies, regulations or incentives, with a focus on an accreditation system and access to finance for IBs; and mid-term priorities: shifting to secure sustainable financing and scale, monitoring and evaluating the implementation and the impact on people’s livelihoods and living standards, and, finally, advocating to include IBs into national policies for continuity and sustainability.

Inclusive Businesses can engage the private sector into the development of the country

By paving the way for an enabling business environment, small or medium enterprises can transform into IB models, attracting impact-focused investors to support the achievement of their development goals.  Unlocking these vital funds will drive growth, competitiveness, and innovation across key sectors,  improve access to essential services, promote job creation, and advance gender equality. The vision of achieving inclusive and sustainable growth in Nigeria can be materialized by upscaling the Kaduna blueprint. By promoting growth through innovation and inclusion,  engaging key public-private stakeholders and fostering unique collaborations, Inclusive Businesses stand poised to drive the desired economic and social growth, bridge societal divides and strengthen social cohesion.

This publication is part of an intervention supported by the Investment Climate Reform (ICR) Facility. The ICR Facility is co-funded by the European Union (EU), the Organisation of African, Caribbean and Pacific States (OACPS) under the 11th European Development Fund (EDF), the German Federal Ministry for Economic Cooperation and Development (BMZ) and the British Council. The ICR Facility is implemented by GIZ, the British Council, Expertise France, and SNV. The contents of this publication are the sole responsibility of the author and do not necessarily reflect the views of the donors or the implementing partners.

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