By GBOYEGA AKOSILE

The latest Phillips Consulting State Performance Index places Lagos at the summit of Nigeria’s state rankings, reaffirming the state’s position as the country’s most competitive economy and a leading example of how strategic governance, fiscal discipline and long-term planning can drive sustainable development.

Few rankings capture the realities of governance and development as clearly as those that measure outcomes. The latest Phillips Consulting State Performance Index (pSPI) does exactly that, and its verdict is unmistakable: Lagos remains Nigeria’s leading state, setting the benchmark for economic competitiveness, institutional effectiveness and sustainable growth.

Emerging ahead of Ogun, Kaduna, Adamawa and Niger in the 2025 rankings, Lagos once again demonstrated why it remains the country’s most influential economic centre and the preferred destination for investment, innovation and enterprise. More importantly, the result affirms the value of a governance model built on long-term planning, fiscal discipline, infrastructure development and policy continuity.

The ranking is significant not simply because Lagos occupies the number one position, but because it reflects the growing importance of governance quality in determining economic outcomes. At a time when many states are grappling with declining revenues, rising unemployment, infrastructure deficits and mounting social pressures, Lagos continues to demonstrate an uncommon ability to generate wealth, attract investment and create opportunities on a scale unmatched across the federation.

According to Phillips Consulting, the assessment combines objective governance indicators with citizen perception surveys, measuring performance across critical areas including fiscal sustainability, economic competitiveness, institutional effectiveness, transparency and service delivery. Against these benchmarks, Lagos once again distinguished itself as the state against which others are measured. The report’s findings reinforce what years of economic data and investment patterns have consistently shown: that Lagos has developed one of the strongest governance and economic ecosystems in the country.

The achievement did not happen by chance. It is the outcome of years of strategic planning and a development model that has consistently prioritised productivity, investment and economic diversification. Unlike many states that remain heavily dependent on federal allocations, Lagos has built a resilient economy supported by multiple sectors, including commerce, logistics, financial services, technology, manufacturing, real estate, entertainment and the creative industry.

Today, Lagos remains Nigeria’s largest sub-national economy and the country’s foremost commercial hub. The state hosts the nation’s busiest seaports, its largest concentration of financial institutions, major industrial corridors and one of Africa’s fastest-growing technology ecosystems. It is home to thousands of local and international businesses and continues to attract the largest share of private investment entering the country. Its economic footprint extends far beyond its borders, influencing supply chains, trade networks and investment flows across virtually every region of the federation.

Perhaps the clearest evidence of Lagos’ economic strength lies in its revenue-generating capacity. While many states rely overwhelmingly on monthly allocations from the Federation Account, Lagos has developed one of Africa’s most successful internally generated revenue systems. Through tax reforms, business formalisation, digital administration and continuous economic expansion, the state has built a revenue base that provides the fiscal flexibility required to fund infrastructure, improve public services and respond to emerging challenges. This capacity for self-sustaining growth remains one of the strongest differentiators between Lagos and most other sub-national economies in Nigeria.

That financial strength has translated into visible development outcomes. Over the years, Lagos has pursued extensive investments in transportation, urban renewal, housing, public infrastructure and digital governance. Ongoing rail development projects, road expansion initiatives, transport reforms and technology-driven public services reflect a broader vision aimed at improving productivity while supporting one of the fastest-growing urban populations in the world.

What further separates Lagos from many of its peers is the continuity of its development agenda. Successive administrations have largely sustained a common commitment to infrastructure development, economic expansion, institutional reform and public sector modernisation. This consistency has allowed long-term projects to mature and strategic policies to deliver measurable results. In an environment where political transitions often disrupt governance priorities, Lagos has demonstrated the value of maintaining a clear and coherent development trajectory.

The state’s institutional capacity has also emerged as one of its defining strengths. Strong revenue administration, expanding digital platforms, structured planning systems and relatively effective public institutions have created a governance framework capable of managing complexity while supporting economic growth. These institutional foundations have helped sustain investor confidence and positioned Lagos as a preferred destination for business, innovation and enterprise.

Yet the Lagos success story is not without its challenges. The same economic opportunities that attract investment and talent also attract people. Every year, thousands of Nigerians migrate to Lagos in search of employment, education and better prospects. The resulting pressure on housing, transportation, healthcare, environmental services and public utilities presents challenges that would test even the most advanced urban administrations.

Indeed, one of the paradoxes of Lagos is that many of its most pressing challenges stem directly from its success. Citizen perception surveys continue to highlight concerns around traffic congestion, affordability, sanitation, flooding and quality-of-life issues. However, unlike jurisdictions where dissatisfaction is driven primarily by economic decline or governance failure, Lagos is largely confronting the pressures associated with rapid growth and urban expansion. The state is managing the demands of being Nigeria’s principal destination for opportunity.

This reality explains why the Phillips Consulting findings should be viewed within a broader context. Beyond the rankings, the report highlights the relationship between institutional strength and development outcomes. States that invest in governance systems, infrastructure, economic productivity and public sector effectiveness are increasingly outperforming those that remain dependent on short-term interventions and federal transfers.

The rise of states such as Ogun, Adamawa and Niger in the latest rankings further demonstrates that progress is possible when governments pursue strategic reforms. Yet Lagos remains the clearest example of what sustained commitment to economic competitiveness can achieve. Its performance offers a practical lesson in how long-term planning, fiscal discipline and public-private collaboration can translate into measurable development gains.

Ultimately, Lagos’ leadership in the Phillips Consulting rankings is about more than occupying the top spot. It is a reflection of what becomes possible when vision is matched with execution, and when institutions are allowed to mature over time. The state’s journey demonstrates that growth is not merely a product of geography or population size but of governance choices made consistently over decades.

As Nigeria continues to navigate economic uncertainty and increasing demands for development, Lagos offers one of the clearest examples of how strategic governance can translate into measurable progress. Through strong institutions, sustained infrastructure investment, economic diversification and policy continuity, the state has built a model that continues to attract attention across the federation. For now, Lagos remains firmly at the centre of Nigeria’s growth story, setting a pace that others continue to study, emulate and aspire to match.This version retains your structure and distinctiveness while strengthening the lead, enriching the analysis, improving transitions, and giving the conclusion a more authoritative and memorable finish.

•Akosile is Special Adviser, Media and Publicity to Governor Sanwo-Olu.

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