What Business in Nigeria Should Look Like this Year
Q. What Are Your Projections for the Nigerian Economy in 2017?
Hmm, yes. That’s been interesting. Between the months of November and now (December 2016), quite a number of people and institutions – some financial institutions, some economists – have all made projections about 2017. The general view is that 2017 is going to be more difficult than 2016. The next thing that has been said is that it’s probably going to be in 2018 that we’ll actually start to show a few signs of recovery from the recession.
Q. What does this mean for business?
People, companies, and institutions have to take more remedial steps and measures to keep their overheads down. They need to reduce costs. I think SMEs are going to have to be a lot more creative about sustaining market share… maybe growing market share. My personal thought is that some people are going to change business.
I remember speaking with someone at the Lagos Chamber for example, who up until now has been a car sales company – and you know what’s happening with car sales given the foreign exchange rate and everything. So this person’s company over the last 12 months has invested in manufacturing consumable parts like batteries for the cars. That’s what that company is planning to do in 2017. So I see some companies changing what they do, not necessarily leaving their sector.
Q. Who are those who are likely to make more money in this recession?
Like someone said, in automobiles, if you can’t afford a new car, you want to maintain the one you have and make it last longer. So people who are into car repairs, and maintenance of equipment and so on for example, will make more money. But it’s going to be tough in 2017. That’s my personal opinion.
Q. What sectors do you see growing?
Well, there’s agriculture because agriculture is the fashion right now. Imagine that! Everyone wants to be a farmer! What has caused this? It’s the drive of government policy. The governments (both federal and state), are encouraging people to go into agriculture. Let’s feed ourselves and others – at least let us be able to eat in all of this. So agriculture is one.
I think there’s also light manufacturing because the real value in agriculture is in value added services – in the processing. So people are going to process agricultural products, you know, like tomato into paste or dried tomato, fruit into juice, yam into flour, nuts into oil, and that sort of thing. So there’s all of that part of the value chain that’s value added that will grow.
I think ICT will continue to grow. It’s all about technology these days and there are wonderful things happening. This is why I love young people. I don’t want to use Lagos to qualify Nigeria because Nigeria is such a big place, but in Lagos for instance – I call them a new generation of market women – these are young ladies who have setup their shops online, and they will do your shopping for you. So I hear these days if you go to markets like Mushin, or Sandgrouse, and ask them who are your competitors, they will say it’s the internet. Because these ladies (the new generation of market women) realise that women are very busy today, looking for work-life balance, and they need people they can trust to do their shopping for them. They (the new generation) do it even better because at the end of the day they’re buying wholesale and passing the savings on to you.
People say Hospitality, but I am not sure. Hospitality, that is the tourism and the rest of hospitality – I am not sure. I think that when people have less money in their pockets they’re less likely to spend it on hospitality, you know? But I do think that Entertainment will continue to grow. Everybody needs a good laugh to relax in hard times. So I think Nollywood will continue to make waves, and the interesting thing about them right now is that we’re getting better movies coming on screen as more of them come together in groups to produce films and shows.
So that’s our outlook for 2017. Do you agree with Mrs. Mabogunje, or do you think it’s going to play out differently? Comment below, and let us know.