A large number of international organisations and business people have been wary of doing business in Nigeria for many years.
This may seem strange given that Nigeria is one of the most populous countries in Africa as well as being one of the most oil-rich places in the world. Couple this with the fact that the country is abundant in many other natural resources and has good port facilities and you might think that international business would be fighting for a piece of the action in Nigeria.
The fact that Nigeria is not a magnet for international investment could be seen as a tragedy of immense proportions. Years of political instability, regional strife and the weakening influence of massive corruption have resulted in the country failing to capitalise on its many advantages; leaving the mass of the population in relative poverty and the country enormously infra-structure poor.
Huge strides have been made in the last few years to try to tackle the many endemic problems which assail the country — with political and economic stability being seen as the key weapons in attacking the corrosive influence of corruption. Whether the actions being taken on the ground have led to dramatic improvements in levels of transparency and levels of corporate governance remain to be seen – in the meantime, the country struggles along and those doing business in Nigeria need to be aware of the issues that await them.
Written and Produced by Keith Warburton
Nigeria’s massive oil reserves can be seen as both a blessing and a curse. The sale of crude oil represents about 70% of government revenue and an incredible 90% of the country’s exports. A blessing when oil prices are high but a real problem when prices fall dramatically. Nigeria needs to diversify away from such over-dependence on the oil industry and it needs external help to achieve this diversification.
Therefore, Nigeria definitely needs foreign investment and know-how. It probably needs what your company is selling – which must make it an attractive potential market. In addition to the country-wide need for investment across a whole range of sectors, Nigeria also has demographics on its side. Over half the population (which will be 200 million before too long) are under the age of 24. That represents a huge new potential consumer market who are aspirational and consumerist.
Is Nigeria an attractive market? Should you be looking at doing business in Nigeria?
The fact is that Nigeria is a difficult market from a number of perspectives. Corruption is often cited as the major barrier to doing business in Nigeria and it is undoubtedly true that corruption is rife in many areas of commercial activity. However, the major stumbling block when entering the Nigerian market could in fact be the local business culture. You would be very unwise the approach the Nigerian market without first trying to get a solid understanding of the way in which business is done locally. It isn’t like ‘back home’. Do some research and arrive in-country as well-informed as possible.
This country profile provides an overview of some of the key aspects of Nigerian business culture in a concise, easy to follow-format. The document includes information on: