About a year ago, Nigeria stole South Africa’s top spot as the largest economy in Africa. Records show that GDP growth in Nigeria stood at 6% in 2013, 7% in 2014, and 8% is expected for 2015. This steady climb signifies that Nigeria is not only one of the fastest-growing economies in Africa, but also in the world.
Of course South Africa’s per-capita GDP remains much higher, and its stock market has a market capitalization value more than twice that of Nigeria. This is why South Africa is considered an Emerging Market, and not a Frontier market like Nigeria or Kenya. However, this does not mean that the Stock Exchanges of the two latter aren’t increasingly interesting. The development of the capital markets in Kenya has a long history already (more than 60 years), and the Nigeria stock market is considered by many investors to now be more lucrative than that of the Johannesburg Exchange in South Africa.
But I digress. Now that Nigeria has moved up to become the world’s 26th largest economy, it has most definitely joined the burgeoning club of middle-income countries. With a population of almost 175 million, I find that it is important to note that Nigeria is not simply interesting due to the sheer size of its consumer market, nor the country’s oil. In fact, many sectors have contributed to the country’s success, such as Agriculture (Nigeria is self-reliant for food), ICT and Pan-African Banking Services. My opinion, naturally, remains steadfast. Nigeria, like the rest of Africa, needs more entrepreneurs and SME’s. If its economy is to compete globally, priority should be given to these by creating an enabling environment for them to thrive. After all, SMEs possess great potentials for employment generation, improvement of local technology, output diversification, development of entrepreneurship and forward integration with large-scale industries.
For SMEs, the potential is everywhere: in low-tech sectors such as the production of footwear and clothing (for the burgeoning middle class), but also in Telecom, biotechnology, and agro-processing.
Recent statistics show that only 1/6 of Nigerians are involved in SME’s (compared to 1/3 of Kenyans), so there is clear room for improvement. This may signify that one of the country’s priorities should be adequate financing for all those innovative and ambitious entrepreneurs out there. Be that as it may, it is clear that Nigeria will remain Africa’s clear leader for a while yet.
Nigerians elected Muhammadu Buhari yesterday, putting him firmly in charge of Africa’s biggest economy. The sheer logistics involved in the election were impressive; 68,833,476 eligible voters showed up at 155,000 voting points, which were attended by 700,000 polling attendees.
An African Milestone: Nigeria’s 2015 elections
The aftermath of the election was even more impressive. Apart from Boko Haram rearing its ugly head and causing the deaths of several voters, both the winning and losing teams lined the streets to celebrate the “New Nigeria”, with only the honking of cars “disturbing the peace” according to a local radio station.
The peaceful handover of power from one party to another is another positive milestone for Africa and proves that Nigeria is now indeed an established democracy. Not only is it that, it is also one of the largest democracies in the world, with the biggest telecom, banking and film industries in Africa, to name but a few.
Mr Buhari will certainly have a lot on his plate. His country has the continent’s largest petroleum reserves and a rapidly growing middle-class made of a complex mix of almost 170 million people speaking more than 500 languages, split between Muslims and Christians. Though they mostly live side by side in peace, there are still ongoing disputes that will need to be handled diplomatically, not forcefully.
Luckily, Goodluck Jonathan’s 6 years of infrastructure projects (hospitals, bridges, and roads) have (literally) paved the way for a greater Nigerian nation. And while Buhari cannot hide from his past as a one-time military chief who overthrew an elected president in 1983, he has since submitted himself to the electorate in no fewer than three previous elections. He has clearly become a patient and wiser man, keen to join the ever increasing rank of great African politicians, rather than those who left their countries in a worse state than in which they inherited it.