Over 50 Million Informal Businesses Operate In Lagos
The Lagos State Manager for the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN), Dr. Olubunmi Kole-Dawodu, has brought attention to the fact that over 50 million informal businesses operate in Lagos.
Kole-Dawodu made this revelation during the Stakeholder’s Forum on Economic Data Performance, organized by the Lagos Bureau of Statistics (LBS) at the Lagos Chamber of Commerce and Industry (LCCI) recently.
According to him, the businesses, ranging from street vendors to unregistered workshops, significantly contribute to employment, revenue, and income distribution but remain largely excluded from official economic data, distorting the true size of the state’s GDP.
“We know that a lot of activities run within that sector, a lot of value including employment creation, revenue generation, income generation for their employees and all that. We want to harness all the blessings that come with that sector. This is a whole sector that the government has not been looking at completely.
“The number of informal businesses in Lagos alone is above 50 million which means that some people run two or three businesses informally. Some are not registered officially, some do not have tax identification numbers, and so whatever they do is just informal or semi-formal in some cases,” he stated.
Kole-Dawodu emphasized the importance of collecting reliable data from the informal sector and incorporating it into economic planning and GDP calculations. He noted that recognizing the sector’s role is crucial for Lagos’ economic development and will help the government create targeted policies to support its growth.
The call for greater focus on the informal sector is part of ongoing efforts by SMEDAN and the Lagos State Government to engage stakeholders and develop strategies for formalizing and strengthening this key economic area. Accurately capturing the contributions of informal businesses in economic data can unlock new growth opportunities and boost Lagos’ economic stability.
The Permanent Secretary, Lagos State Ministry of Economic, Planning and Budget, Mrs. Olayinka Modupe Ojo highlighted the informal sector’s significant role in livelihoods and GDP. Despite its resilience, she noted the sector’s underrepresentation in economic data, which hampers growth and integration.
Ojo acknowledged the challenge of capturing data due to the sector’s decentralized and often undocumented nature, but stressed that the forum offered a valuable opportunity to bridge this gap by involving government, academia, civil society, and sector representatives.
Chief Emeka Ofili, a retired Director from the National Bureau of Statistics, also praised the initiative, noting that while the economy encompasses both formal and informal sectors, current GDP calculations predominantly reflect the formal sector. He supported efforts to include informal sector data for a more accurate representation of Lagos’ economy.
Nairametrics
