Nigeria Archives - GUJRAT INDIA

Finding Houses For Sale in Lagos, Nigeria

In Lagos, Nigeria, there is a tourism boom about to be unleashed following development efforts and economic growth that promises many opportunities to investors. The result of this is a rapidly expanding real estate sector offering unlimited opportunities to reap bountiful harvests from. Take for instance 5 years ago undeveloped land in the Lekki axis of Lagos Nigeria and Ikoyi areas sold for less than half its current market value with developed properties selling in some cases for less than one third of the current market price. This is indicative of a real estate boom and unlike the stock market boom of 2004 – 2008 the real estate boom is an investor’s haven.

This brings us to some of the issues that will naturally be encountered as a result of people preferences and choices with buying houses. A number of problems are associated with buying and selling of houses in Lagos Nigeria and it is only proper I mention some of them before listing out places to find houses to buy or sell.

One of the major problems will be the omooniles (descendants of the land owners or original occupants of various communities in Lagos Nigeria). These are usually idle and Lazy people who want to lay claim to almost any major development taking place on Land they may have already sold to people. By extorting money and collecting illegal fees these omooniles make life difficult for home owners or people desiring to build their own houses. Be on the look out for them whenever you decide to buy a house in Lagos Nigeria. Your best protection against omooniles is to buy directly from reputable real estate companies or acquire land directly from the government and build as quickly as possible. Another problem you face would be real estate fraudsters who could go as far as faking contact details of some reputable real estate companies in order to hoodwink home seekers and other real estate investors. Many of these fraudsters make offers that are too good to be true or unrealistically attractive in order to get at your money. Always insist on patronizing reputable real estate agencies and companies and ensure that you visit their offices to verify their authenticity.

In 2009, and onwards there are many places to start your search for houses available for sale in Lagos Nigeria. Here is a compilation of a list of places to find houses for sale in Lagos Nigeria;

1. Online Classified Adverts

Classified online adverts such as those on nairalist.com, nairaland.com and several websites of real estate companies is a major channel for finding houses and other property for sale in Lagos Nigeria.

2. News papers and magazine publications

A number of newspapers run dedicated editions for advertising or informing the public about opportunities to buy and sell houses in Lagos Nigeria. The most recognized of these is the Guardian Newspaper which runs a Monday Edition dedicated to the real estate sector. Another well known publication for finding houses for sale in Lagos Nigeria is castles magazine. There is also Properties and Homes magazine among others. The draw back is that these publications can only be bought in Nigeria as they do not circulate globally hence people living abroad may not find this option convenient.

3. Recognized real estate companies and Agencies

There are a lot of real estate companies in Nigeria but a few well known include Jide Taiwo and co, Ubosi Eleh and Co, Diya Fatimilehin and co, UAC Properties Limited and Unions Homes among others. Contacting any of these companies is search of houses for sale is another way to go about it. This option covers you although not completely from the activities of omooniles.

4. Enquiries on on-going projects

You could also make enquiries about on going projects such as construction of housing estates and other similar projects directly through the contractors who could refer you to the real estate agency or company handling the project or possibly the owner in order to meet with and negotiate a deal if possible. However not all housing projects have options for selling houses as some of them might actually be tenement projects in which case the owners are only interested in letting out.

Conclusion

Be warned that not all adverts or information made available on channels for sale of houses in Lagos are credible and reliable, you are advised to still carryout some investigation into the claims because some real estate fraudsters are on the prowl looking to defraud unsuspecting buyers of houses in Lagos Nigeria. Also possible for locating houses for sale in Lagos Nigeria is the option of word of mouth from people within your social network although this is hardly as reliable as the other earlier options.

Venture Capitalism and Enterprise Revolution in Nigeria

The African Capital Alliance (ACA), a private equity fund manager in western Africa, announced the raising of $200 million from investors in July last year. The third installment of the Capital Alliance Private Equity (CAPE) fund will target important sectors such as power, oil and gas, communications and financial services in Nigeria and across the sub-Saharan region. The ACA is confident of eventually raising a total of $350 million for the fund from aid agencies, international banks and Nigerian institutional investors. The development reflects mounting confidence in Nigeria’s resurgent economy, considering the country’s fist such fund that started out in 1998 with a capital of just $35 million.

While there is no conclusive data on the size of the Nigeria equity market, estimates for the whole of Africa put it over $6 billion in 2000; South Africa, the continent’s largest economy, accounting for half the share. High economic growth fuelled by an enthusiastic reforms programme has seen Nigeria’s growth scale to almost double the figure for developed markets in recent years. The country’s GDP growth rate in 2006 stood at 5.6%, significantly higher than the US (3.2%) or the UK (2.8%)1. Although the private equity market is still in its infancy here, increasing opportunities to invest in high-growth businesses have succeeded to some extent in eroding the conventional insistence on public equity and debt. However, there continue to be significant risks attending investment in Nigeria due to unhealthy policies, a volatile security situation and massive infrastructure shortfalls. Much of this holds true for the continent at large and explains why it receives only a fragment of global foreign direct investment (FDI). Out of the estimated $250 billion in global FDI to developing countries in 2001, Africa received only $11 billion2.

For many international investors, venture capital and private equity in Nigeria are risky propositions because of political instability, violence, social unrest and corruption. Progress in this direction has been impeded by several other reasons as well:

* Poor corporate governance and lax regulatory mechanisms.

* Red tape, legal restrictions and hostile investment policies.

* High trading costs in the primary market for equities.

* Market volatility and the resulting high-risk perception.

* High exit risk for investors because of low liquidity.

* Difficult and often confusing ownership and property rights.

Over the last decade, Nigeria has displayed a steady commitment to reforms. The Investment and Securities Decree was passed into law soon after the return of civilian rule in 1999, opening up the economy to foreign investment. The government of former president Obasanjo also established the Investment and Securities Tribunal for speedy resolution of disputes arising out of investment deals. More recently, the Securities and Exchange Commission slashed transaction rates for equities from 6.9% to 4.2%. International venture capital investors have shown increasing interest in Nigeria after the liberalisation of several important markets like telecommunications, transport, and oil marketing. The fact that fresh policies have persuaded at least some investors to overlook the high cost of doing business in Nigeria is a significant achievement in itself.

Its large population and market size bestow tremendous potential on the Nigeria economy – Africa’s third largest and among the most rapidly growing. The country’s ambitious Vision 2020 programme and the UN Millennium Development Goals together represent considerable challenges in terms of economic revival. Past experience favours strongly against big businesses, which have had a dismal track record and a high-failure rate under both private and public operation. Undeniably, the fate of Nigeria’s long term goals rests on rapid proliferation of SMEs and their ability to drive an enterprise revolution that will sufficiently diversify the economy away from oil and reverse decades of stagnation. The objective is to use SMEs to deliver sustainable development, employment creation and most importantly, poverty alleviation.

This is where venture capitalism derives its significance in the context of Nigeria’s long-term ambitions. Private equity investment has been responsible for some of the most notable economic success stories across the globe. Entrepreneurs starting out with angel loans turned India around into the largest software exporter in the world. In South Korea, booming small high-tech businesses bypassed larger firms to lead the country’s recovery from the Asian economic crisis. Equity funded enterprises have likewise recorded high growth figures in developing countries from Asia, across Europe and in South America. The global experience with venture capitalism throws up a number of important considerations in terms of providing the right environment for rapid growth. The following are some of the most important challenges and considerations facing Nigerian policy makers in this regard:

* Establishing a venture capital technical assistance programme to enhance SME performance in diverse economic sectors.

* Institutionalising tax benefits for equity investment to attract foreign investors.

* Providing risk guarantees to create strategic venture capital industries that improve self reliance and curb import quotas.

* Enhancing venture capital capacity to stimulate and promote the industrial expansion.

* Focusing equity investment on SMEs that optimise resource utilisation and assist local raw material development.

* Promoting innovative business ideas, processes and techniques that boost both productivity and profitability.

* Hastening industrialisation through equity infusion in high-growth areas like telecommunications and tourism.

Nigeria’s reforms process prompted a unique voluntary initiative at the turn of the last century when the Nigerian Bankers’ Committee launched the Small and Medium Enterprise Equity (SMEEIS) scheme. Billed as an attempt to promote entrepreneurial expansion, the scheme required all locally operating commercial banks to earmark 10% of pre-tax profits for equity investment in small and medium enterprises. Even though more than Naira 18 billion had been set aside by 2003, utilisation of the funds remained abysmally poor at less than 25%. The Nigerian Central Bank owed it to a lack of viable projects and general reluctance toward equity partnership. If poor managerial and business packaging skills are areas of concern, the prevailing mindset against venture capitalism in both existing and emerging enterprises is even more so.

To quote former Central Bank governor Joseph Sanusi (29 May 1999-29 May 2004), accelerated economic development is not possible until Nigerian entrepreneurs learn to appreciate that “it is better to own 10% of a successful and profitable business than to own 100% of a moribund business”.

IGR and Formalising the Informal Economy in Nigeria

Nigeria has had a tumultuous history, marked by decades of virulent political and civilian strife since its independence in 1960. The oil boom of the ’70s brought windfall profits to the emerging state, but corruption and gross mismanagement blighted economic indicators and rendered the vast majority of its population destitute. A reforms process initiated after the first democratically elected government was sworn to power in 1999 is beginning to show results, but hardly of the nature or scale that can reassure a country desperate to shake off its Third World heritage.

At the ground level, the extended economic stagnation and Nigeria’s persistent failure to enforce corrective policies spawned a flourishing informal economy – the aggregate of financial and business activity that operates outside government control, contributing neither in taxes nor in contribution to the country’s GDP. It includes everything from backyard employment and self-help finance to street vending and unregulated manufacturing. Nigeria’s vast informal economy of products, services and financial services was born out of necessity but is now estimated to contribute up to 65% of current Gross National Product. Even with a significant readjustment of the percentage, there is no debate that the state is losing out on millions in internally generated revenue (IGR) because of activity in the unorganised sector. IGR, or inland revenue, refers to state earnings from levies and taxes. Although current figures for Nigeria’s federal IGR are unavailable, it has been traditionally diminutive in relation to the country’s oil profits, which account for 85% of state revenue.

Across the African continent in general and especially in Nigeria, the informal sector no longer plays an auxiliary role but leads official economies in terms of maintaining livelihoods and creating new jobs. The present Nigerian government accepts that more than 90% of all new jobs are being created by this unorganised sector. The Lagos report in fact goes a long way to show that, even if only subconsciously, Nigeria is vitally dependent on its informal economy. Moreover, it needs to cultivate this sector and bring it under the tax regime if its long-term macroeconomic goals are to be achieved. The Nigerian informal economy is therefore critical on two counts: in terms of untapped revenue and, more importantly, as the driving force behind rapid enterprise development for durable economic growth. This is what the government can do to gradually subsume the informal economy under its jurisdiction:

* Devise innovative policy to bring unorganised activities under official purview through a system of sops, tax breaks and finance aimed at both existing and emerging unregulated businesses.

* Streamline tax and business regulations for universal applicability; crack down on systemic corruption through stringent penalties.

* Promote a credit environment sympathetic to small business realities. Government effort should concentrate on promoting lending through equity, not debt, because Nigeria’s informal economy is mostly about high-risk ownership businesses.

* Improve productivity in small businesses through infrastructure development and removal of trade and administrative barriers. Enhancing technical support and capacity building assistance to aid existing and emerging entrepreneurs.

* Transform education at the vocational and skills level to create a dynamic manpower base that is equipped to meet entrepreneurial challenges. Creating supplementary programmes for relevant technology and computer education.

Spain provides a sterling example of how it can be done right. Through the 1990s, the Spanish government pursued a radical reforms programme, easing corporate taxes and regularising labour laws. The outcomes was a drastic 40% fall in the unemployment rate over a period of six years, fuelled by massive job opportunities in the informal sector. Even though tax rates had been slashed, the government augmented revue collected from small companies by over 75% by bringing more of them under regulation.

Even though Nigeria has been the second largest economy in the continent after South Africa for years now, independent researchers have long been pointing out that the ranking is unrealistic in the sense that it takes no account the vast Nigerian parallel economy. The theory may not be unlikely but is near impossible to prove because sufficient relevant data for Nigeria is unavailable. There is no doubt however that the country’s future position in world affairs hinges considerably on the development and formalisation of its massive informal economy. In terms of attitude, what it requires foremost is the suspension of conventional perceptions with regards to the unorganised sector: in other words, a paradigm shift in economic policy outlook and execution.

The process of Nigerian economic reforms that began in 2001 has seen concrete steps aimed at boosting the private sector:

* A bank consolidation programme was initiated in 2004 to fortify financial institutions and enhance credit access to the private sector.

* Rapid disinvestment in large enterprises was started with the privatisation of mining, communication and oil marketing corporations.

* The government deregulated oil prices in 2007 and enforced the national Fiscal Responsibility bill and the Pubic Procurement bill.

Some of these measures have produced tangible results, cutting inflation and boosting international currency reserves. Their long term effects though are yet to be observed or examined.

In December 2008, the government of President Umaru Yar’Adua presented budget proposals for withdrawal of $200 million in African Development Bank trust funds to issue 10-year government bonds. The move was part of the treasury’s efforts to plug a substantial budgetary deficit amounting to almost 4% of GDP. Sadly, short term-measures such as this otherwise unremarkable decision have defined Nigerian economic policy for more than the last half century. What it needs in order to shed its Third World credentials is a unified, innovative strategy that reverses overdependence on oil and actively seeks to formalise its informal economy.

Specifically, Nigeria needs to come up with practical measures to convert its traditionally survivalist practices into entrepreneurial ventures that contribute revenue, create more jobs and provide innovative products and solutions. A number of Abuja’s policy directives in recent years have sought to reform the old economy to ostensibly promote small businesses and seed an entrepreneurial revolution. Besides its obvious contributions in terms of employment and income generation, the Nigerian informal economy is responsible for a number of positive effects –

* It allows a productive outlet for a huge population of Nigerians who are self employed by choice or necessity.

* It creates economic competition and promotes innovative business practices relevant to local realities.

* Most importantly, it mobilises Nigeria’s significant human resource pool that would otherwise be unused, or worse, ill-used.

In the Nigerian context, formalising the informal economy is synonymous with enterprise development and long-term macroeconomic growth. An endeavour of such moment calls as much for creative innovation in policy design as it does motivated implementation. In light of the country’s troubled past, its government would also do well to build popular consensus on important issues before trying to enforcing radical laws. Far reaching change, however, will only come with the realisation that leveraging the informal economy is key to resolving the age old Nigerian paradox – a country of enormous resources with extreme povert

Nigeria: A Rising Trade Partner With the West

In recent years, people may be apt to dismiss Nigeria as a legitimate player in the global trade arena. For all the resources this country offers the West and other parts of the world, the association of the country with the rapid rise in Internet and phone scams risks the Nigerian reputation. These dubious e-mails are referred to as such as in the beginning the majority of messages originated (or claimed to come from) Nigeria – although now similar Internet scams come from other parts of the world. Despite this mark, it should be noted that Nigeria is a growing member of the Next 11 group of trading countries, an emerging mixed economy ranked among the top forty nations in the world in terms of gross domestic product.

In its home continent, the republic follows only South Africa in ranking the top African nations by overall economy – and is the largest in West Africa. Thanks to rich oil fields, the country provides a powerful resource for petroleum that hasn’t gone unnoticed among western nations, including the United States. The US alone accounts for Nigeria’s greatest percentage of foreign investment.

Top Exports of Nigeria

The majority of the republic’s overall income is derived from petroleum and crude oil exports. As a member of OPEC and one of the largest suppliers in the world, Nigeria exports billions of dollars worth of oil annually – with the United States receiving the lion’s share. Other popular exports include:

Cocoa beans – While not a major figure in this commodity as other countries, several million dollars’ worth of cocoa exported around the world makes this crop quite valuable.

Natural rubber – With a growing interest in manufacture of “green products,” Nigeria has seen a rise in demand for rubber and tree gum.

Tree and ground nuts – More than half of the republic’s labor force is agricultural, and ground nuts especially make up a good percentage of crops.

Cooking oils – Palm and coconut oils are pressed and exported regularly.

Top Imports of Nigeria

Nigeria’s primarily agrarian environment leaves her people to rely upon global imports to sustain the domestic economy. Drilling equipment for their natural oil resources is especially in demand, as is other excavating machinery. Other top imports from the United States and elsewhere include:

Grains – Corn and rice come in high demand, for though Nigeria has plenty of land for farming it is used more for what they export.

Automotive – Cars and transportation are shipped regularly into country to ensure business stays moving.

Refined petroleum byproducts – As with other countries, Nigeria tends to export more crude and raw materials and leave refinement to trading partners.

With western nations continuing to seek alternative fuel partners, it is a great probability Nigeria will figure more into American trading. There is definitely more to this country than an unfortunate association with Internet misbehavior.

Discover the African Art of Adire Dress Making When You Travel to Nigeria

Lagos is regarded as the commercial nerve centre of Nigeria. It is known for its hustle and bustle, as well as an intricate blend of cultures – both local and foreign. Many residents in fact refer to it as no man’s land because indigenes from all parts of the country (and outside) have made it home.

The result is a breathtaking kaleidoscope of cultures evidenced – in part – by the regular display of different attires by each cultural unit. One of the most prominent cultures in Lagos is the Yoruba tribe. They are able to lay claim to being the sons of the soil in Lagos, but are accommodating to outsiders.

As a key component of South Western Nigeria, Lagos also shares fashion and cultural trends with adjoining regional states. And one of the most distinctive facets of the Yoruba culture is the Adire art form. From the earliest days of the arrival of foreigners in Nigeria, history has shown that one of the greatest attractions tourists and visitors have found in Nigeria, has been the Adire.

Adire is a unique traditional textile made by the Yorubas, using hand knotted cloths that have been dyed in indigo. The art of making this patterned cloth has been passed down across generations, even though at a time, it suffered a decline in popularity amongst practitioners and its patrons.

Efforts by some celebrated practitioners of this elegant age old art form have however helped to launch a recent renaissance in this field. Most prominent amongst those involved in this re-awakening of interest in the Adire, locally and internationally, has been Nike Davies Okundaye, a strong advocate of African Arts, with a mission to export it to the rest of the world.

She has achieved worldwide recognition for her exceptional artistry in making Adire cloths over a three decade period, and up till date. Her website http://www.nikeart.com provides extensive resources that offer insight into her work – including offering links to other websites which reflect the international appeal she enjoys. This exceptional lady was featured on the cover of The African Courier magazine, in its February/March 2010 issue, with six pages dedicated to a review of her work, including excerpts from an exclusive interview she granted.

Today, Nigerian fashion designers in the 21st century also creatively employ the Adire in evolving a unique range of very fashionable and trendy African designs, which are regularly showcased in fashion show catwalks across Africa and even beyond. This is one of the great benefits the Adire affords – it is highly adaptable for use in various forms, for various purposes – decorative or otherwise.

If you are a lover of African art, the Adire dress making process is definitely one to be explored. More importantly, especially if you feel you cannot spare the time to visit a place where these unique creations are made, look out for the many shops where beautiful Adire cloths are put up for sale. Be sure to get informed opinion about how to purchase the types that are durable, and will not fade when washed, at reasonable prices.

It would interest you to know that quite a number of good hotels in Lagos, and other western states often have gift shops with sections dedicated to the sale of artworks – including Adire. Note however that these shops can be a bit pricey, and that you can get much better bargains buying directly from the less pretty stalls of the local people or residents, some of who actually make it themselves. It is well known that the best places to buy well done Adire dresses include Abeokuta in Ogun State, and Osogbo in Osun State – where Nike Davies Okundaye runs one of a number of her galleries in the country.

So, don’t forget, when you visit Nigeria, to make out time to explore the world of Adire cloth making, picking up a few souvenirs to take back home with you. If the news we have heard from other visitors to Nigeria is anything to go by, you and those you share your artistic gifts with, will be raving about and showing them off with pride!

Solar Energy In Nigeria – Time To Get Down To Business

Many Nigerians believe the only way to solve the age long electricity crisis in the country is through independent power generation, as they have since lost faith in the government’s ability to decisively solve this problem that has significantly stunted the growth of the Nigerian economy for years now. Well it will be difficult to blame people trying to meet basic electricity supply needs and also keep businesses running without much hassle.

As we now know the environmental threats and inconveniences power generators cause, it is quite encouraging to see some effort from the government, research institutes and private stakeholders on the development of alternative energy sources for power generation. Solar energy, which is the most abundant of all the available renewable energy sources, has been making raves of late and I believe it is about time we started taking the prospects of this energy source more seriously.

Considering the current issues with unbundling the power sector, deregulation and increase in generating capacity, we can begin to pick some positives from the evident change in approach by some factions of the government regarding solar energy. Do not get me wrong, Nigeria’s interest in solar energy dates back to decades ago but the subsequent effect before now has been drastically minimal.

ENCOURAGING PROSPECTS

Besides the abundant oil and gas resources that we currently hold, Nigeria is still fortunate to be situated in Sub-Saharan Africa, a region described by the International Council for Science as having the world’s best solar resources. Nigeria has 485.1million MWh/day of solar energy in natural units and we enjoy an average of 6.2 hours of daily sunshine. Despite this, approximately over 60% of Nigeria’s 170 million people lack access to electricity supply. Our main sources of electricity come from hydro and gas and we currently have an installed capacity of 5,600MW of electricity but generate less than 5000MW due to a myriad of issues.

The use of solar electricity systems aids the capture of solar energy using photovoltaic (PV) cells which convert the sunlight into electricity. This resource has been found to have the capability of providing more power than all the fossil fuels we currently hold if properly harnessed and used to generate green and cheap electricity. Eventually, it can play a part in reducing our huge dependence on fossil fuels like crude and gas for power generation.

CRITICAL CHALLENGES

According to the United Nations, rural-urban migration in Sub-Saharan Africa will have increased by 87% in 2030 from the 1950s. Putting Nigeria in mind, this will definitely mount more pressure on the existing electricity infrastructure which has not been significantly improved for decades now despite the government’s target to generate 297, 900MW in the year 2030.

One of the key challenges in investing in solar energy is the initial capital outlay which is high. According to reports, solar panels are expensive to install and maintain. Dr Aliyu Modibbo Umar, the former FCT minister was quoted as saying it costs up to N500, 000 per panel and another source says it costs up to N200, 000 to maintain. Nonetheless, more recently, the cost of solar technology has reduced by 40% in the last two years. Our neighbours Ghana last December announced plans to build the biggest PV solar power plant in Africa generating 155MW and will increase its generating capacity by 6%. According to Blue Energy, the UK firm behind this deal, the reduction in costs and an enabling feed-in tariff policy played a key role in helping the project kick off.

Another challenge being faced in the use of this energy source is the maintenance and day to day running of the solar infrastructure. There appears to be insufficient personnel with the technical wherewithal to manage these facilities and ensure they are running up to speed. In 2005, there was a remarkable feat achieved by the Lagos State government in solar energy installations when a rural solar electrification project was launched at Onisowo Village in the Amuwo -Odofin Local government Area- a village that was cut off from the national grid. In the past two decades, states like Zamfara, Bauchi, Benue, Bayelsa and Rivers have also partnered with the World Bank and the Energy Commission of Nigeria to carry out similar projects in rural communities across the country. Despite the complaints on the efficiency and maintenance of these facilities, we have seen that we have the capability to put these structures in place which we can pick positives from and definitely build on.

RECOMMENDATIONS

It is of great importance that we speedily tap into alternative energy sources that are cleaner and safer due to the country’s vulnerability to climate change. Since we have established existing and growing interest in this technology, the government needs to assist significantly in funding domestic solar energy research in research institutes and universities. Government subsidies will also be helpful in the importation of solar panels and other equipments that cannot be manufactured locally. This will support independent investors and individuals who have interest in the energy source.

Borrowing from the UK’s feed-in tariff concept, the government can also encourage independent electricity generation through solar panels by providing more incentives for consumers and suppliers who choose to invest in this source. It will always be soothing to the ear when you know you will get rewarded for generating your own electricity. Installing and understanding this infrastructure is still considered by many as technical and expensive, but through extensive awareness programmes and public and private sector initiatives, this process can be simplified and will eventually become cheaper to install and use in the long run.

Finally, on affordability, Nigerians have shown that they can invest money on power generation when presented with a better alternative. We can see the percentage of people using power generators and inverters in both rural and urban cities in Nigeria which gives us a picture of how they will handle the prospect of solar energy if the installation process is simplified and equipments are cheaper and readily available.

The Resurrection of the Cinematic Culture in Nigeria

Films such as The primitive, Primitive Man, Buffalo Hill were considered suitable while Dr Jekyll & Mr Hyde, The Isle of forgotten sins, House of Frankenstein were considered unsuitable for viewing. The Yoruba travelling theatre group of the 60’s and 70’s is renowned for being the arrowhead of movie productions in Nigeria. They took their theatrical skills a step further to film productions using the celluloid format.

Notable filmmakers during the 70’s celluloid boom era include but not limited to Ola Balogun, Eddie Uggbomah, late Herbert Ogunde, Adeyemi Afolayan (father of Kunle Afolayan), Moses Adejumo, Ladi ladebo, and Afolabi Adesanya. Movies released during that era include Kongi Harvest, Alpha, Bull frog in the sun, Amadi, Muzik man, Bisi daughter of the river, Ija ominira, Aiye. Our founding film makers were faced with the herculean task of raising funds to produce their movies.

Nigerians further worsened the situation by opting to watch movies of occidental and oriental origin at the cinemas and exhibition centres. Chinese films with the late legendary Bruce lee thrilled us with films such as Big boss, fist of fury, while Indian films from 60’s to 70’s paraded stars such as Rajesh Khanna, Dharmendra singh deol, Amitabh bachchan, Hema Malini and recorded hits such as Bobby, Sholay, kabhi Kabhi, Dharamaveer, Amar Akbar Anthony.

The movies treated Nigerians to outstanding combat/sound and special effects, cinematography, good story lines amongst others. The founding fathers could not recoup their investments and with fewer investors unwilling to take a plunge into the dicey venture, the number of films produced began to decline. The deluge of VCRs in the 80’s provided the alternative of making movies on VHS format than on Cine. Productions turned out to be easier to make, faster, cheaper by a mile stone in comparison to the cine productions.

Cinema houses and other exhibition centres were finally shut down in the early 80’s. The 1992 rise of Ken Nebue’s “Living in bondage” brought forth the Home video industry a.k.a Nollywood, though it was debunked by late prince Alade Araomire who insisted that his movies actually paved the way for the industry. Nollywood, blossomed over the years with the telling of our stories, projecting our lifestyle, culture, local fashion, burning issues and problems affecting our society. However, the presence of over flogged themes and trippy plots, flawed scripts, choppy editing, high predictability rate, formulaic movies amongst others, have added to the declining rate at which home videos are purchased and watched. Home video thrived in the 90’s and early millennium. Foreign movies were still patronised by those who were tired of the lack lusture performances seen in home videos.

The cinematic culture was resurrected through the establishment of the Silver bird galleria (which houses the cinema) by chairman of the Silver bird group (Ben Murray Bruce). At first people thought it was a flash in the pan judging from the fall of yester years, but over time the galleria has played host to thousands of movie enthusiasts through its release of latest movies(dominantly Hollywood). The galleria capitalizes on its synergy (silver bird TV and rhythm 93.7fm radio station) and of course movie listings in Friday Vanguard and The Sunday edition of the Nation newspapers. Nollywood movies have also been accorded the same opportunity to be viewed by all.

Kunle Afolayan’s “Irapada”, Jeta Amata’s “The Amazing Grace”, kingsley Ogoro’s “Across the Niger”, Teco Benson’s “Mission to nowhere”, were among the early set of Nollywood movies viewed at the galleria. Perhaps, the booster for the film makers to have their movies on the big screen came with Stephanie Okereke’s “Through the Glass” which made N 10 million in two weeks at the galleria. This has further prompted filmmaker / producers to go for the big screen rather than the customary straight to the VCD /DVD approach. Tunde kelani’s “Arugba”, Vivian Ejike’s “Silent scandal”, Emem Isong/Desmond Elliot’s “Guilty Pleasures”, “Nollywood Hustlers” co-produced with Uche Jumbo, Lancelot Imaseun’s “Home in exile”, kunle Afolayan’s “The Figurine, araromire, Teco Benson’s “High blood pressure”, Jude Idada / Lucky Ejim’s “The Tenant” have towed the cinematic path.

Nu metro and Genesis Deluxe cinemas also exist and even the cinema halls at the National Theatre have come alive! Foreign investors can catch in on the growing profitable trend to establish cinema houses in other parts of the country. We can only hope that the cinematic culture will thrive across our Greenland and will never undergo the dearth experience of the 80’s.

Militants in Niger Delta – Bad For Nigeria, Could Be Good For Angola & Ghana

Like many developing nations with vast natural resources, Nigeria has seen a massive influx in Foreign Direct Investment (FDI), particularly in the energy sector. However, civil unrest, particularly in the Niger Delta, may be a catalyst for potential investors to look to other West African Nations as investment opportunities. Added to this are the ever present problems of ineptitude & “graft” within both state & federal government, which has brought some unwelcome news for Africa’s largest economy.

Last week, Russian giant Gazprom (OTC : OGZPY) announced that it was in discussions to inject up to $2.5 Bn into a joint venture enterprise with state owned Nigerian National Petroleum Corp (NNPC), with a view to developing domestic gas production, processing, and transportation.” Nigeria has an estimated 187 trillion cubic feet of natural gas reserves. Industry experts see the deal as a positive move by the federal government to utilize the country’s huge gas resources that have hitherto been wasted, it is estimated that Nigeria flares off as much as 14% (24 billion cubic feet) of global gas wasteage.

The Russian gas company is attempting to become involved with the Trans-Saharan gas pipeline (TSGP). The pipeline, which would connect the Niger delta in Nigeria and Niger, to existing gas transmission hubs to the European Union at El Kala or Beni Saf in Algeria’s Mediterranean coast, is expected to cost $10 billion, of which Gazprom will initially invest $2.5 billion. The project is due to commence in 2009 and isplanned to complete in 2015, when Nigeria hopes it will become one of the biggest sources of natural gas for continental Europe.

Livi Ajounuma, General Manager at NNPC, confirmed that “we have signed a Memorandum of Understanding [MOU]”. He commented further on the deal saying, “It’s a good thing. It means that a giant company like Gazprom can come to Nigeria.”

All is not as rosy as it may seem however, as the Russian Ambassador to Nigeria, Alexander Polyakov, staged a withering blow at Nigerian confidence this week. Polyakov has called on the Nigerian authorities to create a stable environment for foreign nationals who come to work in the country, to continue the flow of foreign investment and development of the economy. Over 200 foreigners and countless Nigerians have been kidnapped in nearly three years of rising violence across southern Nigeria. Some militants claim to be fighting for greater control over the Niger Delta’s oil wealth, however, other gangs of armed, jobless youths make money from extortion and kidnapping.

Polyakov urged prompt release of all hostages, including some Russians,currently being held by militants in Nigeria’s southeast Niger Delta region.”Everybody in the region and the government should play their role to ensure that all hostages are freed,” he said.

There are strong indications that investment inflow to the upstream sub-sector of the Nigerian oil industry has started dwindling as foreign investors now choose Angola and Ghana as preferred destinations over Nigeria. Which in turn, threatens Nigeria’s capacity to grow its crude oil reserves as planned, it is targeting 40 billion barrels proven reserves by 2010. Analysts have identified insecurity in the Niger Delta and weak fiscal policy as key reasons why investors are beginning to leave for more stable business opportunities in Africa. Recently due to militant activity Royal Dutch Shell (NYSE : RDS:A) has seen its production dropping from one million bpd to about 380,000 bpd at its Bonny terminal in the south of the Delta. Exxon has also experienced increased insurgent activity in its Nigerian operations.Last week, local union officials threatened to call a strike which would shut down crude exports from the River state, until such time as the issues are addressed by State & Federal officials. Nigeria is already suffering from production slow down due to militancy, currently the Niger Delta is only exporting 1.8 million bpd, compared with a targeted 2.2 million bpd.

Near neighbour Angola has now begun to attract more investments from oil companies as International Oil Companies are making long term expenditure commitments in the African oil ventures. Total (NYSE : TOT) said last week that it would continue with a $9 billion investment to raise production in Angola, despite the huge drop in crude prices since July last year. Total plans to stick to its major investments in Angola, even as it expects crude prices to recover, the company’s top official in Angola said.

“We are living through a crisis that has pushed oil prices to very low levels. Therefore, we are being extremely strict with all our investments,” Olivier Langavant, Director General in Angola, was quoted as saying in an interview with Reuters. “But the big projects (in Angola) like the Pazflor, which is a $9 billion investment, will be maintained.”

Pazflor, Total’s third production hub in Angola’s offshore Bloc 17, is expected to begin pumping oil in 2011 from water depths of up to 1,200 metres, according to the company’s website. Total is the third biggest oil producer in Angola after Exxon Mobil Corp. and Chevron, pumping, on average of over 500,000 barrels per day.

Chevron, Total and Eni are currently developing a $4 to $5 billion liquefied natural gas plant in Soyo, Angola. Whilst in contrast, Nigeria’s flagship Olokola, Brass LNG and NLNG Train 7 projects are yet to take off. Because of the high spend of the oil majors in Angola, oil service companies have begun to win big contracts. BP has awarded Halliburton more than $600 million in contracts for up to four projects in Angola.

Meanwhile, in Ghana, offshore oil finds in 2007 have led analysts to look at the small nation as becoming an “African Tiger”. Three vast blocks off of the West Cape Three Points are believed to hold vast reserves that may well outshine those enjoyed by Nigeria. The Jubilee field, one of West Africa’s biggest oil strikes in years, likely containing recoverable reserves of at least 1.2 billion barrels of oil equivalent, with first output scheduled for the second half of 2010. IOCs are lining up to take advantage, as smaller independent firms such as Kosmos Energy struggle to find capital to develop proven resources in the area. Kosmos is reputed to have a $3Bn stake in the area up for grabs, according to industry website Rigzone. The current breakdown of partnership/ownership across the three blocs which can be viewed here at AfDevInfo, also includes US independent Anadarko (NYSE : APC) & the UK’s Tullow (LON : TLW), along with various Ghanaian government run corporations.

This at a time when foreign investors in the Nigerian capital market withdrew some $4 billion from the Nigeria Stock Exchange kick starting a decline of over 50% in three months, according to its Director General, Professor Ndidi Okereke-Onyiuke. Coupled with an ever rising inflation rate, the highest for more than 5 years, is a major setback for Nigeria’s hopes of becoming a local economic giant.

Business Enterprise – The Key to Change in Nigeria

Nigeria currently stands 41st in international GDP rankings, according to the IMF World Economic Outlook Database – its largely oil-driven economy pegged at $165 billion. This marks a fourfold increase over ten years from just $36 billion in 19971. Progressive policies undertaken in the years following the installation of a democratically elected government in 1999 takes the credit for this remarkable increment. The Nigerian Economic Policy, 1999-2003, is specifically to praise for incorporating far-reaching measures that have helped enable Nigerians with access to technology and education.

A vigorous disinvestment programme involving public sector units in oil marketing, communications and port operations boosted private sector participation and led to the creation of jobs and ancillary businesses. The spirit of economic reforms was further evident when oil prices were deregulated in 2003 and four national refineries were privatised. However, these and other initiatives have not succeeded entirely, and Nigeria remains “information poor” in the context of utilising computing power in the industrial process. Further, and although digital networks have come up in recent times, the communications infrastructure continues to suffer massive deficits.

For average Nigerians, what has improved in recent times is access to technology, and a new breed of emerging entrepreneurs are harnessing the power of the Internet to start model ventures and strike global partnerships. While their contribution as foreign-exchange earners is minor in terms of the Nigerian economy, the significance of their innovation, in the context of Nigeria’s past economic stagnation, can hardly bee overlooked. What is optimistic for the government and Nigerians in general is that such stories of successful Nigerian enterprises are starting to gain in frequency. Even though the rate of progress has been slow, the country is decidedly on the right track as far as promoting business development goes.

Nigeria is currently the United States’ largest trading partner in sub-Saharan Africa. In 2008, the USA imported Nigerian goods (predominantly oil) worth $38 million. The figure is up from $32.7 million in 2007 and indicates a growing US dependence on Nigerian oil, which currently accounts for almost 11% of its import requirement.

The Paradox

The ‘Nigerian Paradox’ is a frequently cited economic phenomenon that describes the condition of sweeping poverty and abysmal human development indices in a country of abundant natural recourses that earns billions in annual petrodollar revenue. The economic decline of Africa’s most populous nation began right after the oil boom of the 1970s, when political corruption and non-inclusive policies plunged the vast majority of Nigerians into degrading poverty. Subsequent decades of civil and political unrest and the continuation of outdated policies made Nigeria a virtual untouchable for international investors. Over the years, the deteriorating security situation was paralleled by a simultaneous decline in infrastructure that killed existing businesses and made the emergence of new ones impossible. The corresponding human toll was even more disturbing as the country plunged into decrepit poverty and economic despair.

Because of the deep fissures in its history, Nigeria’s emergence from a disturbing past has not been smooth. The recent reversal of some of its fortunes has come at a steep price and the country continues to lag behind in vital indicators. A historic overdependence on oil skewered agriculture and local industries and created massive economic imbalances that are still far from being corrected. Rampant unemployment and inflation have created a climate of youth unrest that precipitated in violent militancy in the oil-rich but volatile Niger Delta region, together with rising levels of organised crime. Severe infrastructure deficiencies – especially in power, roads and communications – widened the rural-urban divide and provoked large scale migration into towns. Official indifference and inhibitive policies spawned a gigantic informal economy that continues to grow and operate outside the ambit of government regulation despite furious policy redirections in recent years.

Surprisingly, this unorganised sector currently contributes 65% of Nigeria’s GDP and accounts for 90% of all new jobs.

The Improvements

There have been a number of improvements fostering business growth. They include:

* Entrepreneurs have more control over their lives and have obtained social and financial security for their families.

* The Nigerian government has now made it possible for Nigerian products to be shipped to Europe and the United States.

* Entrepreneurs in Nigeria are being offered tax incentives in order to promote further enterprise development.

* Modern technology is making its way into Nigerian culture, taking the country closer to self-sufficiency in the technology sector. However, it is an ongoing process that that banks heavily on government aid.

Opportunities

Established in December 1999, The Small and Medium Enterprises Equity Investment Scheme (SMEEIS) instructed all Nigeria’s banks to put aside 10% of their pre-tax profit for investment in small and medium sized enterprises. This was to present an opportunity for those looking to break into a business of their own. Sadly, as of 2006, only 26% of this funding had been used.

The Nigerian Small and Medium Scale Industries Development Agency (SMEDAN) is another important player in the country’s efforts to boost entrepreneurial spirit. Although it’s still a rather young organization, it is making a positive difference.

Skills and Ideas Development Initiatives (SKIDI) is an NGO that is helping entrepreneurs realize their dreams in Nigeria so that they can obtain the freedom that they desire. There is a specific focus on rural and suburban Africa, especially since rural areas have seen more poverty. The poverty rate in Nigerian rural areas stood at 40% in 2001, compared to the 35% in urban areas where more businesses are prevalent.

Bridging that gap happens to be just one of the many challenges on Nigeria’s road to prosperity.

The Case For Privatisation and SMEs in Nigeria and Sub-Saharan Africa

In the first five years of this decade, 37 countries in Sub-Saharan Africa together raised more than $11 billion through privatisation programmes. Although the bulk of this corpus was raised in low-value transactions in competitive sectors, the figure puts the region next only to Europe and Latin America in global privatisation trends. While Africa, Ghana and Zambia were among the top contributors, Nigeria takes the undisputed lead. Africa’s third largest economy contributed more than 70% of the $975 million generated between 2004 and 2005, most of it through a single deal involving the disinvestment of a major port operation.

Across Africa, privatisation had become the guiding principle for countries trying to develop dynamic private sectors and expand their economies. Yet, countries continue to face tough challenges in terms of disappointing social indicators, deficient infrastructure and huge productivity shortfalls. Essentially, the continent’s integration into the global economy had been held back by extreme poverty, especially in the Western regions where it continues to vitiate attempts at sustainable development.

Nigeria has managed to lead the pack in aggressive privatisation in Africa based on the realisation that it is the only relevant and economically viable means towards rapid and inclusive growth. Since the return of civilian rule at the end of the last century, Nigeria has also prioritised poverty alleviation based on sound macroeconomic policy interventions. The thrust of its endeavour has been on curbing state expenditure and involvement in direct economic production, mobilisation of resources and promotion of local and foreign investment. However, given its overwhelming dependence on oil exports and the gross mismanagement that marked successive decades of military rule, Nigeria faces a dizzyingly uphill climb.

While its intention for economic reform has never been in question, Nigeria’s track record in handling privatisation deals has been rather chequered. The broad parameters of its initiative drew on past successes elsewhere in the world, from the UK to Russia, and from Europe to the USA and Asia. Nigeria’s formal introduction with the concept came about with the Privatisation and Commercialisation Decree of 1988, an initiative mandated by the IMF-funded Structural Adjustment Programme. In 1999, the Bureau of Public Enterprise (BSE) was set up by federal government enactment to prepare and implement the government’s privatisation policies. Embarrassingly, a number of the first privatisation deals ended in fiasco.

The government of former president Obasanjo sold off two refineries to a private consortium, but the sale was later overturned by the administration of Late President UM Yar’Adua over allegations of wrongdoing. Subsequent efforts to privatise refineries have had to be stalled because of policy loopholes. Disinvestment of the Nigerian public sector telecom monopoly NITEL ended in disaster when the company suffered huge losses and failed debt obligations, forcing the government to retake control earlier this year. The now defunct national carrier, Nigerian Airways, likewise failed to take off despite several attempts at commercialisation. Besides indicating ineptitude in policy and implementation, these instances, more importantly, serve to highlight the extensive failure of big business in Nigeria.

In the US, small firms with less then 500 employees account for 99.9% of the country’s 24 million business. SMEs in the European Union together provide 65 million jobs or two-thirds of all employment, while 90% of all Latin American businesses are micro-enterprises. Nearer home in Kenya, 2003 figures reveal SMEs contributed 18% of national GDP. Considering global trends in the last several decades, the arguments in favour of SMEs over large enterprises are simply overwhelming. Rapid enterprise development in an atmosphere conducive to private sector growth is the only way Nigeria can hope to achieve it MDG commitments or its indigenous Vision 2020 goals.

The benefits arising out of privatisation are too crucial for Nigeria to ignore in the context of its long-term growth plans:

• Depending on prudent implementation, privatisation can help strengthen capital markets by widening local ownership through reservation of shares for citizens.

• Many governments have successfully reduced national debt by raising money through disinvestment and related instruments, curbing the need for subsidies and tax concessions.

• Privatisation engenders healthy competition that helps expand markets, establishes best practices and improves production and service standards.

• World Bank research confirms substantial performance improvement in private enterprises with the removal of administrative constraints typical of public sector operation.

• Developing countries like India and Brazil with strong commitment to free markets have succeeded in acquiring massive foreign investment by privatising public sector monopolies.

Foreign direct investment in Africa jumped from less than $1 billion in 1995 to $6.3 billion in 2000. Although this makes for a healthy increase, the flow of investment into Nigeria and the rest of sub-Saharan Africa remains curtailed because of local restrictions. The region lacks competitive markets and consistent regulatory frameworks that provide the right atmosphere for privatisation. Considering its past experiences, it is imperative that Nigeria formulate effective public sector reforms before pushing ahead with any further sale of public assets. Moreover, such measure must be undertaken as part of a larger effort at promoting economic efficiency.

The privatisation of utilities and large public-sector infrastructure tends to throw up even harder challenges. Nigerian lawmakers must be particularly concerned about strengthening institutional mechanisms that regulate market operations. This entails reinforcement of administrative and legal systems, capacity building of implementation agencies and reduction of corruption and political interference. The failed disinvestment of Nigeria’s flagship RORO Port in Lagos is a case in point when it comes to demonstrating the pitfalls in the privatisation process in this corner of the world.

The three separate facilities at the Lagos port that handle an estimated 180,000 tonnes of annual cargo was under private operation for a number of years. The owners showed huge salary expenditure to explain dismal profits averaging just over $40,000 annually, forcing the Nigerian Port Authority to resume control. Within a year and without any further investment, profits had jumped back up to over $1 billion.

Although shocking, such incidents suggesting massive corruption have regularly punctuated Nigeria’s economic recovery. Some estimates go so far as to say that 70 Kobo of every Naira the federal government spends is absorbed by the very bureaucracy that it meant to deliver it. Whatever the direction of its privatisation policies, governance in Nigeria is as much in need of radical reforms as its economy!