Nigeria at 50: It Is Africa's Biggest Democracy and Most Populous Nation, and Is Renowned for Its Rich Culture and Entrepreneurial 'Can Do' People That Make No Secret of Their Aspiration to Become the Continent's Economic Powerhouse. but How Far Has Nigeria Fulfilled Its Promise over the Past Half Century? Sarah Rundell Discusses
Rundell, Sarah, African Business
Nigeria has come a long way since it won independence from Britain 50 years ago this October. Milestones include the country becoming the first African nation to pay off its multibillion dollar debt burden, prompting a rush of foreign investment and enabling more government spending on crucial infrastructure, health care and education.
In the last 50 years Nigeria has become one of the world's biggest oil exporters, having experienced an oil boom in the 1970s. Now buoyant prices have helped fuel economic growth. An amnesty in the oil-producing delta has delivered a relative calm to the Niger Delta with no major militant attack for nearly a year.
But at 50, Nigeria's bold ambition and exciting promise remain thwarted by massive challenges. Despite its huge oil wealth, the majority of the population is in poverty.
It remains to be seen whether a string of much-promised privatisations and reforms will bring meaningful change.
Corruption and a lack of transparency continue to deter some foreign investors. Many left when spectacular growth in the financial services industry came to an abrupt halt and prompted a $4bn government bailout.
Political instability has slowed down the pace of change after the prolonged illness and then death of President Umaru Yar'Adua followed by the swift ascension of Goodluck Jonathan as his successor. Jonathan plans to seek re-election in the polls due in January.
Nigeria's economy is expected to grow by 6% this year, positioning the country to overtake South Africa as sub-Saharan Africa's biggest economy. One factor behind that growth has been the emergence of a new middle class linked to the growth of the private sector in industries like banking, telecommunications and services, centred round urban areas, particularly Lagos. Nigeria's first mall, The Palms, opened in 2006 and encapsulates this emerging Nigeria, believes Prakash Pantham, director of Persianas Properties, the company behind The Palms.
"Malls provide a shopping experience middle-class Nigerians now demand. It offers shoppers a wide variety and quality of products in a clean environment. Our customers are assured of sales support and warranties on their purchases and in many cases prices are actually more competitive than in local markets. Malls give retailers the chance to focus on their own business rather than worry about maintaining their building or electricity supply."
Spending by Lagos's upwardly mobile, low- to middle-income consumers helped push combined annual turnover at The Palms' 70-odd shops, entertainment outlets and restaurants to nearly $90m last year. On average, 25,000 shoppers pour into the complex each weekend, Pantham says.
A growing drinks market
In another indicator of economic growth, Nigeria now has one of the top 10 fastest-growing drinks markets in the world. Listed companies like Heineken's Nigerian Breweries, the country's biggest brewer, Consolidated Breweries and Guinness Nigeria, part of British drinks company Diageo, all report record sales. Nigeria sells more Guinness than any other country apart from Britain.
McDonald's-style fast-food chain Mr Bigg's, owned by NSE-listed United Africa Company of Nigeria, has grown from 10 outlets to 185 in 10 years.
During 2009, revenue and profit after tax for the Nigerian subsidiary of PZ Cus-sons were up on the previous year by 23% and 20% respectively, boosted by booming sales of electrical goods including first-timer purchases of televisions and freezers through HPZ LTD, a Joint Venture between PZ Cus-sons Nigeria and Haier Group.
Consumers are suddenly brand aware. Businesses have latched onto the importance of using celebrities to sell their wares. The popular Nigerian rapper D'banj's videos helped Unilever's Close Up toothpaste grab a 70% market share. …