Is Lagos State Government Determined to Kill Thriving Businesses?

babajide sanwo olubabajide sanwo olu

By Adedapo Adesanya

The recent moves by the Lagos State Government are already making some Nigerians, especially those doing business, to raise eyebrows.

There have been conspiracy theories in some quarters that there is a secret power play to suffocate innovation and leave citizens at the mercy of their government.

It is not a hidden truth that technology has not only brought about ease of doing business but has also caused disruptions that have threatened old players, who either have to keep up or risk being kicked out of the scene.

Also, technology has made some Nigerians think out of the box to make things happen for themselves where the government has failed.

However, it has been a reoccurring pattern that whenever such ventures are beginning to yield good fruits, the government swoops in under the aegis of regulations to bring up back-breaking policies unfavourable to the operators.

This is all but becoming a common trend in the Centre of Excellence as seen recently with plans to regulate e-hailing operators such as Uber, Bolt, among others.

The latest information is that the state government, headed by Governor Babajide Sanwo-Olu, is planning to earn about 10 per cent of every fare charged by drivers from passengers.

This is coming after the same government frustrated commercial motorcycle operators out of the business almost after getting funds to expand their businesses.

In February 2020, the government of Mr Sanwo-Olu, after identifying with some key bike-hailing firms, restricted the operations of motorcycles and this singular policy sent most operators packing. Since then, the likes of Gokada, Max, and Safeboda have had to move out of the state to others, where they have a better policy.

Some have even claimed that if the environment was favourable to the late CEO of Gokada, Mr Fahim Saleh, he may have still been alive and may not have had any reason to be in the United States, where he was killed last month.

But it is important to note that Business Post does not subscribe to this.

Beginning from next Thursday, ride companies in the city with less than 1,000 drivers are expected to pay a N10 million licence fee, while those with more than 1,000 drivers are to pay N25 million.

Subsequent renewals were also put at N10 million for those with more than 1,000 drivers and N5 million for those with less.

As for operators with 50 cabs or less, they are expected to pay a N5 million licence fee with an annual renewal of N1.5 million, while those with more than 50 cabs are to pay N10 million with a renewal subscription of N3 million.

An interpretation of this is that while the already established players like Uber and Bolt can afford this because of capturing the market earlier, it may be very difficult for relatively new players as certain conditions made by the state look like they are aimed at killing innovation and fair competition.

Better still, is the Lagos State government trying to play in the same league where it is the referee?

In March, the Lagos State Yellow Taxi/Cab Drivers Association launched a digital mobile app to enhance their operational efficiency and also keep up with the times.

The Ekocab application was designed to enable the Ministry of Transportation to monitor commuter patterns to aid the state government in proffering innovation regulations and solutions for overall improvements in the Lagos transportation sector.

The new regulations extend this to other platforms, directing them to give the Ministry access to their database. This might be interpreted as a means of knowing the hotspot where these services operate and seek to penetrate there.

Already, it is being speculated in some quarters that this recent move by the state government was triggered by the Yellow Taxi group, who observers say see the Ubers and others as a major threat to their existence.

Also, the aggressiveness by which the state is seeking to raise revenue is also being touted to have a political undertone.

Conspiracy theories continue to fly around that the supposed landlord of Lagos State allegedly needs funds to pursue his dream of becoming the most powerful person in Nigeria by 2023 and his foot soldiers are working to make this a reality.

If we must attract investors into the country, policies like this must be taken away. Only recently, the federal government tried to frustrate the logistics business when it noticed that the sector was already becoming a money-spinner.

Also recently, there were reports that local councils in Lagos State were asking for a weekly fee of N600 from agency banking sector of the economy.

The administration of Mr Sanwo-Olu must make efforts not to be seen as killing innovation and businesses all in the name of generating revenue. At least, if the government cannot efficiently cater for its citizens, it should not use policies to frustrate those trying to make their lives better through a legitimate means.

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