Business

Why Nigeria Needs More Tech Entrepreneurs

Published

9 years ago

August 10, 2015

The growing rate of internet users in Africa has mandated its proper implementation towards the betterment of African people, while countries like Egypt, South Africa, Morocco, Kenya, etc. are taking advantage of internet opportunities, Nigeria with over 70 million (internetwordstats.com) internet users is yet to fully utilize its population and growing market to its advantage.

There are two main reasons why Nigeria is a key factor in actualizing the African entrepreneurial dream: one, Nigeria is the second fastest-growing key emerging market in the world (Euromonitor.com) and on track for a 7 percent growth rate in 2015 after a successful second-quarter report.

Real GDP Growth in Top 5 Fastest-Growing Key Emerging Economies in 2014

Source: Euromonitor International from national statistics/Eurostat/OECD/UN/IMF

Two, in a research conducted by British Council, Nigeria tertiary age (18-22 years old) population will lead the world through 2024 and grow from 16.1 million in 2013 to 22.5 million by 2024 which is equivalent to an average growth rate of 3.1 percent, far ahead of projected annual growth rate for Indonesia (1.3 percent), a country forecasted to be the next fastest-growing country. Equally, overall tertiary enrolment is projected to double from 2.3 million students in 2013 to 4.8 million by 2024.

However, Nigeria’s unemployment rate is expected to increase proportionally from 7.5 percent to 24.33 percent by 2020 (http://ieconomics.com). This implies that there would be more unemployed graduates by 2020 if nothing is done now.

According to research quoted by Facebook CEO, Mark Zuckerberg, for every 10 people who gain access to the internet 1 is raised out of poverty. Another research shows that on average small and medium enterprises (SMEs) employ between 2 to 100 employees. This is an important figure necessary to fill the void in the labour market and subsequently reduce unemployment, increase export revenue and empower the youths.

Sadly Nigerian internet sphere is limited by negative public perception due to a series of scams emanating from the region, which has hindered foreign investors from helping the youth with viable startups to access funds. Institutions like Paypal, Amazon, etc offer limited services to Nigerians as a measure to curb possible fraud. So is some financial institutions in the U.S and other countries won’t allow Nigerians to trade (forex) or transact on their platforms.

From all indications the internet has created more opportunities now than there was in the past, but the inability of the youth to access a pool of resources has forced many to conform to the seemingly blogging business like Linda Ikeji and the likes. Now, the issue is blogging is currently reduced to entertainment or propaganda as a means to generate traffic, statistically, it is less likely that the nation can create more jobs and reduce unemployment like Google Inc., Amazon, Bloomberg, etc. that way.

As the most populous black nation that accounted for 23.6 percent of African internet users. Not only entrepreneurs can create jobs by thinking creatively but also because the participation of more talented individuals can help solve vital societal issues and subdue negative perception, and as more start-ups strive to attain global standards using the power of technology, global accessibility becomes better, hence, global attention on the region would increase positively.

In June, Facebook Inc., announced the appointment of Nunu Ntshingila to manage over 120 million Facebook users in Africa, over 6.6 million of this population are Nigerians. This move further affirmed Africa as the next global target for future businesses and failure to emerge with the next phase of African/global entrepreneurs by creating sustainable businesses, would leave a vacuum for more foreign businesses to fill at the expense of the people’s interest.

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Samed Olukoya

Is the CEO and Founder of Investors King Limited. He is a seasoned foreign exchange research analyst and a published author on Yahoo Finance, Business Insider, Nasdaq, Entrepreneur.com, Investorplace, and other prominent platforms. With over two decades of experience in global financial markets, Olukoya is well-recognized in the industry.

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Merger and Acquisition

FBN Holdings Clarifies Merchant Banking Divestment, Retains Other Subsidiaries

Published

2 hours ago

September 11, 2024

Samed Olukoya

FBN Holdings has sought to clarify the recent divestment from its Merchant Banking business.

According to the lender, all its businesses and entities apart from the Merchant Banking business are not included in the divestment deal.

It said, “We wish to clarify that all other entities and businesses listed below are not included in the divestment, and they remain subsidiaries of FBNH and are well integrated into the Group’s strategic focus.”

The subsidiaries are FBNQuest Capital Limited, FBNQuest Asset Management Limited, FBNQuest Trustees Limited, FBNQuest Funds Limited, and FBNQuest Securities Limited.

“We reiterate that the divestment pertains solely to FBNQuest Merchant Bank Limited, with no impact on the continued operations or strategic positioning of our other subsidiaries within the Group,” the bank stated in a release signed by Adewale L.O. Arogundade, Acting Company Secretary.

Business

Border Trade Plummets 80% as Naira Devaluation Hits Hard

Published

1 day ago

September 10, 2024

Samed Olukoya

Business activities at Nigerian borders have dropped by 80 percent due to the depreciating Nigerian currency.

Licensed customs agents at the borders said the plunge in the Naira’s exchange rate to the CFA franc is the reason for the declining business activities at the nation’s borders.

In the last three years, the Nigerian Naira has dropped from N300 for 1,000 CFA francs to N2,660 for 1,000 CFA francs.

According to Ogonnanya Godson, Vice Chairman of the National Association of Government Approved Freight Forwarders, Seme Chapter, business activities at the border began declining in 2021.

“The Cotonou CFA franc is now N2,660 for 1,000 CFA francs. It started increasing from N300 for 1,000 CFA francs three years ago until it reached its current level, which is affecting our businesses. The rate at which the exchange rate has been increasing since 2023 is alarming,” Godson stated.

He further noted that some importers have begun boycotting the borders, especially Seme, due to the exchange rate.

“Importers no longer patronize these areas because, after clearing and paying for everything, they end up losing. So activities have dropped by between 70 to 80 percent, and the exchange rate of the dollar is also affecting this area.

“The volume of activities here is now between 22 to 30 percent. This applies to other borders as well because of the exchange rate,” he stated.

Lasisi Fanu, a former Seme Chapter Chairman of the Association of Nigerian Licensed Customs Agents, corroborated Godson’s statements and admitted that activities at the border have declined.

“That is the simple truth and fact about the situation. You can’t get anything less than what you’ve been told about the drop in activities at the borders. Every day, the CFA franc appreciates while the Naira depreciates.

“Today, I was informed that the CFA franc has increased to between N2,650 and N2,700 for 1,000 CFA francs. This began three years ago and has worsened since 2023,” Fanu stated.

Fanu explained that the Naira’s depreciation against the CFA franc is similar to its depreciation against the US Dollar.

“Whatever 1,000 CFA francs could buy in the Republic of Benin two years ago, it still buys the same amount now. It’s the Naira that is depreciating.

“That’s the reason there is no business. The people who used to go to Cotonou for business said there is no more business because their customers there have said they can no longer trade due to the high exchange rate against the Naira,” he explained.

Company News

Dangote Refinery Targets Nigeria’s $267.7 Million Polypropylene Market from October

Published

2 days ago

September 9, 2024

Investors King

Dangote Oil Refinery, the largest in Africa, has set its sights on capturing Nigeria’s $267.7 million polypropylene market starting next month, Aliko Dangote, president of the group said, as its largest oil and gas project edges closer to full operational status.

The refinery, part of the vast Dangote Industries conglomerate, is expected to reduce Nigeria’s reliance on imported polypropylene—a crucial raw material in various industries, including packaging, textiles, and automotive parts.

“Let me assure you of one thing, Nigeria from October will not import any more polypropylene, which used to be about a quarter of a million tons,” he said. “No more imports of polypropylene.”

Polypropylene, a versatile plastic used in a wide range of applications from packaging and textiles to automotive parts and medical equipment, is currently imported in large quantities by Nigerian manufacturers.

Annual polypropylene import into Nigeria is estimated at $267.7 million, according to TradeMap, which peaked at $407 million in 2022.

The latest data by the National Bureau of Statistics (NBS) revealed that the country brought in the product valued at N99.6 billion in the first quarter (Q1) of this year, placing it at number 12 on the top 15 products imported by Nigeria from the rest of the world.

“We will satisfy the market 100 percent,” said Dangote. “This is so because these industries that are struggling and having to go and look for FX that they will not get and still have to keep stock for four or five months because it’s not easy shipping, clearing, and whatever, can buy as they need.”

He noted that the refinery is determined to do this because it will reduce the cost of importation and scramble for foreign exchange.

“We are also in the business. And our demand also as Dangote is huge. We have Dangote Packaging and are one of the biggest demand users of polypropylene,” he added.

Saudi Arabia, South Africa, South Korea, China, and Vietnam were the top importers of polypropylene into Nigeria in the first quarter of 2024, covering 90 percent of Nigeria’s demand.

Polypropylene is a versatile plastic used in a wide range of packaging applications. It’s often preferred over materials like cellophane, metal, and paper due to its flexibility, durability, and cost-effectiveness.

It is used in food and confectionery, tobacco, and clothing industries in flexible form while in rigid form, polypropylene can be found in caps, closures, pallets, crates, bottles, JIT storage solutions, and containers for products like condiments, detergents, toiletries, and yogurt.

Polypropylene’s versatility and benefits make it a popular choice for packaging across many industries.

“The polypropylene market is growing rapidly owing to the rising demand from the packaging industry. This high demand is associated with the increasing consumption of packaged food and beverages,” said Fortune Business Insights, a research firm.

“It also helps in reducing the possibility of food deterioration and quality loss.”