Monday, April 7, 2014
Video - Nigerian breweries investing in Sorghum and Cassava
Nigeria's recent reforms in the agriculture sector are impacting positively on the country's food and beverages industry as producers source more raw materials locally and invest further in the sector.
Video - Nigeria is now Africa's biggest economy
Nigeria has "rebased" its gross domestic product (GDP) data, which has pushed it above South Africa as the continent's biggest economy.
Nigerian GDP now includes previously uncounted industries like telecoms, information technology, music, online sales, airlines, and film production.
GDP for 2013 totalled 80.3 trillion naira (£307.6bn: $509.9bn), the Nigerian statistics office said.
That compares with South Africa's GDP of $370.3bn at the end of 2013.
'Changes nothing'
However, some economists point out that Nigeria's economic output is underperforming because at 170 million people, its population is three times larger than South Africa's.
On a per-capita basis, South Africa's GDP numbers are three times larger than Nigeria's.
And Nigerian financial analyst Bismarck Rewane called the revisions "a vanity".
He added: "The Nigerian population is not better off tomorrow because of that announcement. It doesn't put more money in the bank, more food in their stomach. It changes nothing."
Rebasing is carried out so that a nation's GDP statistics give the most up-to-date picture of an economy as possible.
Most countries do it at least every three years or so, but Nigeria had not updated the components in its GDP base year since 1990.
Then, the country had one telecoms operator with around 300,000 phone lines. Now it has a whole mobile phone industry with tens of millions of subscribers.
Likewise, 24 years ago there was only one airline, and now there are many.
International aid donors are keen for more African countries to undertake this process regularly because it enables them to make better decisions when it comes to aid.
BBC
Friday, April 4, 2014
This coming Sunday Nigeria set to become Africa's biggest economy
Nigeria will rebase its GDP on Sunday, the statistics office said, in a move that will boost its estimated size by anything from around 40 to 70 percent and is almost certain to push it ahead of South Africa to become Africa's biggest economy.
The National Bureau of Statistics (NBS) will change the base year for calculating Nigeria's GDP to 2010 from 1990 to reflect changes in the economy of Africa's most populous nation, and more accurately assess the size of its current output.
Most governments overhaul GDP calculations every few years to reflect changes in output and consumption, but Nigeria has not done so since 1990, meaning sectors such as the Internet, telephones and even the "Nollywood" film industry have had to be newly factored in to give a truer picture, sources say.
When Ghana rebased in 2010, output jumped 60 percent. For Nigeria being the continent's number one economy could prove an irresistible magnet for investors.
Nigeria's GDP only needs to go up by a quarter from a current IMF 2013 estimate of $292 billion to hit $365 billion, which would enable it to overtake South Africa, currently estimated by the fund at $353 billion.
"The impact of a rebasing would likely have a positive impact on perceptions ... this would come at time when most investors are fairly downbeat on South Africa," because of its high combined fiscal and current account deficit, London-based economist for CSL Stockbrokers, Alan Cameron, said.
"GROWTH STORY"
Nigeria has been growing as a destination for foreign investors owing to the size of its consumer market and increasingly sophisticated capital markets. Analysts say higher GDP means more consumption per capita, boosting its allure.
"The globe is still looking at the next strong growth story outside China and India, and Africa is on their minds," said Abri Du Plessis, chief investment officer at Gryphon Asset Management, which has investments in Nigeria.
"We are seeing good growth in the ... Nigeria story."
It is already a growing market for consumer goods firms like Nestle, Heineken, Cadbury and Unilever, as well as construction material firms like Lafarge and Dangote Cement, owned by Africa's richest man Aliko Dangote.
Much increased interest would be in manufacturing and service companies, which could further help Africa's top oil producer move away from its over-reliance on the black stuff.
It certainly won't be the wonder cure for Nigeria's economic ills. For one thing, being bigger means expansion will slow.
"The rebasing exercise will result in an increase in the country's market size, but it is likely to lead to a slower rate of real GDP growth," said Ecobank economist Gaimin Nonyane, from its current rate of 7 percent for the past five years.
It will be mixed for Nigeria's fiscal stance as well, improving the debt-to-GDP ratio, currently less than 20 percent, but expose a weaker tax base, so debt investors won't be moved.
"Fixed income investors will probably not pay much attention to the GDP dynamics," said Standard Bank's Samir Gadio.
Despite roaring growth in recent years and a bigger GDP, Nigeria will continue to trail South Africa in terms of basic infrastructure - power and roads - necessary to lift the bulk of its population of 170 million out of absolute poverty.
And its legendary dysfunction - abysmal telephone and Internet quality, clogged roads, ports and airports, obstructive police and reliance on diesel generators for most of its power - mean it won't be replacing South Africa as a hub very soon.
"South Africa is going to stay the entry point for funds into Africa. I don't think (it will move to) Nigeria," Rigaardt Maartens, a portfolio manager at PSG Online Securities, said. (Additional reporting by Helen Nyambura in Johannesburg; Editing by Tim Cocks and Giles Elgood)
Reuters
The National Bureau of Statistics (NBS) will change the base year for calculating Nigeria's GDP to 2010 from 1990 to reflect changes in the economy of Africa's most populous nation, and more accurately assess the size of its current output.
Most governments overhaul GDP calculations every few years to reflect changes in output and consumption, but Nigeria has not done so since 1990, meaning sectors such as the Internet, telephones and even the "Nollywood" film industry have had to be newly factored in to give a truer picture, sources say.
When Ghana rebased in 2010, output jumped 60 percent. For Nigeria being the continent's number one economy could prove an irresistible magnet for investors.
Nigeria's GDP only needs to go up by a quarter from a current IMF 2013 estimate of $292 billion to hit $365 billion, which would enable it to overtake South Africa, currently estimated by the fund at $353 billion.
"The impact of a rebasing would likely have a positive impact on perceptions ... this would come at time when most investors are fairly downbeat on South Africa," because of its high combined fiscal and current account deficit, London-based economist for CSL Stockbrokers, Alan Cameron, said.
"GROWTH STORY"
Nigeria has been growing as a destination for foreign investors owing to the size of its consumer market and increasingly sophisticated capital markets. Analysts say higher GDP means more consumption per capita, boosting its allure.
"The globe is still looking at the next strong growth story outside China and India, and Africa is on their minds," said Abri Du Plessis, chief investment officer at Gryphon Asset Management, which has investments in Nigeria.
"We are seeing good growth in the ... Nigeria story."
It is already a growing market for consumer goods firms like Nestle, Heineken, Cadbury and Unilever, as well as construction material firms like Lafarge and Dangote Cement, owned by Africa's richest man Aliko Dangote.
Much increased interest would be in manufacturing and service companies, which could further help Africa's top oil producer move away from its over-reliance on the black stuff.
It certainly won't be the wonder cure for Nigeria's economic ills. For one thing, being bigger means expansion will slow.
"The rebasing exercise will result in an increase in the country's market size, but it is likely to lead to a slower rate of real GDP growth," said Ecobank economist Gaimin Nonyane, from its current rate of 7 percent for the past five years.
It will be mixed for Nigeria's fiscal stance as well, improving the debt-to-GDP ratio, currently less than 20 percent, but expose a weaker tax base, so debt investors won't be moved.
"Fixed income investors will probably not pay much attention to the GDP dynamics," said Standard Bank's Samir Gadio.
Despite roaring growth in recent years and a bigger GDP, Nigeria will continue to trail South Africa in terms of basic infrastructure - power and roads - necessary to lift the bulk of its population of 170 million out of absolute poverty.
And its legendary dysfunction - abysmal telephone and Internet quality, clogged roads, ports and airports, obstructive police and reliance on diesel generators for most of its power - mean it won't be replacing South Africa as a hub very soon.
"South Africa is going to stay the entry point for funds into Africa. I don't think (it will move to) Nigeria," Rigaardt Maartens, a portfolio manager at PSG Online Securities, said. (Additional reporting by Helen Nyambura in Johannesburg; Editing by Tim Cocks and Giles Elgood)
Reuters
Forced out Central Governor Lamido Sanusi wins case in court against the government
The court also ordered that Mr Sanusi be given back his passport, and he should not be detained unlawfully.
He was briefly detained in February, soon after his suspension.
Nigeria's President Goodluck Jonathan suspended him after he claimed that $20bn in oil revenue had gone missing.
Mr Sanusi's passport was seized on 20 February at the international airport in Lagos, Nigeria's main city.
The Lagos High Court restrained the government from arresting, detaining or harassing him, Nigeria's Premium Times newspaper reports.
Mr Jonathan says Mr Sanusi was suspended, pending the outcome of an investigation into "financial recklessness and misconduct" at the central bank.
Nigeria's state oil firm has denied failing to account for the money, saying Mr Sanusi's claim was "unsubstantiated".
Mr Sanusi is widely respected after undertaking reforms to the banking sector since his appointment in 2009.
He was named central bank governor of the year for 2010 by Banker magazine.
BBC
Related story: Video - Sanusi Lamido's TEDx speech - Overcoming the fear of vested interest
Thursday, April 3, 2014
Nollywood: most prolific movie machine
Less than 10 minutes into the Nollywood movie, the heart of plot is revealed: A woman has two boyfriends and doesn't know what to do.
The story moves as quickly as the film appears to have been shot. Some scenes are shaky, with cameras clearly in need of a tripod, and musical montages are often filled with pans of the same building.
Most Nollywood movies are made in less than 10 days and cost about $25,000.
Fueled by low budgets and whirlwind production schedules, Nigeria's film industry has grown by some estimates over the past 20-plus years into the most prolific on Earth, pushing out more movies a year than Hollywood in California or Bollywood in Mumbai, India.
Hollywood tends to portray Africa as an exotic land of deserts and giraffes, populated by huddling masses, according to Samuel Olatunje, a Nollywood publicist known in the business as "Big Sam."
Nigerian movies are popular because they portray African people more accurately, Big Sam explains outside his single-room Lagos office. They explore African issues rarely touched on in Hollywood — magic, tribal loyalties, the struggle to modernize.
"Stories that you can relate to," he says.
Ventures Africa business magazine says Nollywood knocks out 2,000 titles a year and is the third-largest earner in the movie world, after Bollywood and Hollywood. The $250-million industry employs more than a million people.
Artists say Nigeria's bad infrastructure and chaotic legal system prevent them from making films that are as impressive in their quality as they are in quantity.
"You'll find that we're having to make do," legendary Nollywood actor Olu Jacobs explains at an exclusive country club in Lagos.
Trained at Britain's Royal Academy of Dramatic Arts, Jacobs says Nigerian artists often have the same artistic capacity as their Western counterparts, but not the same financial capacity. "We're not happy because the finished product doesn't have the finish that it should have," he says.
Later that day, Jacob's driver inches his car through grinding traffic in Lagos, the African megalopolis as chaotic and bustling as any Nollywood production scene. A young businessman in an SUV nearly cuts him off. The SUV driver's eyes grow wide when he recognizes Jacobs, and he smiles like a child meeting Santa Claus. He lets the actor's car pass in front.
Nollywood was born, so the story goes, when Kenneth Nnebue, a video storeowner, had too many blank tapes in the early 1990s. To find a use for them, he shot "Living in Bondage" with a single camera for video. The protagonist joins a secret cult and kills his wife in a ritual sacrifice that wins him enormous wealth but leaves him haunted. The movie was an instant hit, selling 500,000 copies.
But at the country club, Jacobs says modern Nollywood is no accident. When he returned to Nigeria from the London stage in the early 1980s, he, like many other artists, knew he could make successful movies at home.
"We all knew that we had a market," he says. "When I grew up, cinemas were always filled up. Stage performances were all ways full. Why shouldn't there be?"
The main problem for movie-makers, Jacobs says, is also the top complaint of almost every industry in Nigeria: not enough power. Less than half the population of Africa's most populous country has access to government electricity, and even the wealthiest families deal with daily power cuts. Nigerian film producers pay a premium for fuel to run generators to keep the lights on and the equipment going.
Piracy also cuts into profits, Jacobs says. After a film is released, producers have only a few weeks before illegally burned copies undercut their sales. Pirated Nigerian DVDs cost no more than a dollar or two and are available at markets in even the farthest corners of Africa.
But these cheap DVDs have also helped the industry grow, making Nigerian movies wildly popular in Africa and among Africans overseas.
Last year, Nollywood ventured off the continent entirely to screen "Half of a Yellow Sun," a movie about Nigeria's 1960s civil war based on an award-winning novel by Chimamanda Ngozi Adichie, at film festivals Toronto, London and Los Angeles.
While it didn't get rave reviews, the Hollywood Reporter called it an "epic-on-a-budget" that will continue to draw audiences. "Half of a Yellow Sun" had a budget of about $8 million, the largest in Nollywood history.
By comparison, "The Hunger Games: Catching Fire," based on a book by Suzanne Collins, had a budget of about $130 million and was one of the highest grossing Hollywood movies in 2013.
A week after the Los Angeles premiere of "Half of a Yellow Sun," the cast and crew of a Nollywood soap opera, "Remember Me," pack into a hot, borrowed apartment in Lagos. Director F. Olu Michaels secures a red film over a harsh white light with masking tape before calling out "Action!"
Then he silently drops to his hands and knees and crawls behind the cameraman to avoid casting shadows on the set.
After the shoot, as a generator rumbles just far enough away from the set to avoid being picked up by microphones, Michaels says Nollywood films are improving rapidly because of intense competition.
"The quality of what we bring out now is not what we brought out, even five years ago," he says.
Still, he says, the industry has a long way to go before its actors and directors have a chance to make millions of dollars.
AP
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