BUSINESS ENVIRONMENT

We took a look at the business environment in each state to determine how friendly that environment is to business, especially the micro, small and medium sized enterprises (MSMEs).

MSMEs play a pivotal role in any economy, particularly in the areas of production, job creation and facilitating equitable distribution of income. Recent empirical studies show that SME‘s contribute to over 55% of GDP and over 65% of total employment in high-income countries. SMEs and informal enterprises, account for over 60% of GDP and over 70% of total employment in low-income countries, while they contribute over 95% of total employment and about 70% of GDP in middle-income countries.

Hence it is of great importance for any government that is serious about the economy to provide the right support system for businesses. To see how each of the state governments fared, we took a look at two major metrics which are:

• Ease of Doing Business: Takes into account measures of business regulations and their enforcement across the different states.
• Enterprise Performance: Takes a look at the influence ownership and operations of MSMEs has on the local population.