5 Best Sectors You Must Invest in Nigeria It is no longer news that Nigeria is in a recession. However, you need to understand that the re
5 Best Sectors You Must Invest in Nigeria
It is no longer news that Nigeria is in a recession. However, you need to understand that the recession is local and it is a distraction and most importantly, it is a massive opportunity if you know the 5 best sector you must invest in Nigeria whether you are a foreigner, a Nigerian in Diaspora or a Nigerian at home.
It rarely gets better than this. Many experts are available to hire at a fraction of the cost, land in most parts of the country are cheap, and the Nigerian government and its parastatals are ready to deal favorably with anyone who dares to invest in the country.
The best investors in the world frequently tell us when the going gets tough, the tough get going, meaning the recession should be nothing more than an opportunity to put your best investment foot forward and exploit opportunities that present themselves.
In fact, some of the world’s most successful companies like CNN, IBM, GE, General Motors, Microsoft, Disney and Apple all started in a recession. Some other great companies founded during economic crisis are proofs that every bad situation has enormous opportunities if we can only have the right mindset.
Finding the Best Sectors You Must Invest in Nigeria requires a “Fight” Mindset
While science may have a point describing the human being as an animal, albeit a higher level one, but an animal nonetheless, I beg to differ on with most of the reasons except that most humans do display certain characteristics identical to those of beasts, such as the fight or flight response for instance. Fight or flight. Compete or skedaddle.
When we feel physical or mental-emotional pressures, our basic instinct is to run or fight back.
The instinctive all-purpose expulsion of the stress sympathetic nervous system infuses us with adrenalin with which we choose to face the challenge head-on like a cobra or like a terrified bunny to scurry away into the dark.
Pressures like the recent Nigerian economic recession will bring out the best or the worst in you and I depending on how we respond.
I choose to fight and invest in Nigeria despite the economic state.
To know which sectors of the economy are safe to invest in Nigeria, you want to pay attention to the following pointers.
The Best Sectors You Must Invest in Nigeria are Diverse
Yes, you read right. However, it is smart to focus on areas that the Nigerian government is particularly focusing on
Best Sectors You Must Invest in Nigeria – Agriculture
Everybody has got to eat. 200 million Nigerians almost, a number that can only grow in years coming. With the government tightening on imports and raising tariffs at the ports, an immense opportunity presents itself for whomever will do the hard (and smart) work.
Agriculture in Nigeria has erstwhile been mostly subsistence whereas the land is both fertile and plentiful, much of it uncultivated. When we consider that even the staples that are imported from all over Asia are no longer trustworthy, it becomes evident that that food will have be produced internally.
Rice, beans, yam, cassava, maize, millet, and a tremendous variety of fruit and vegetables all grow excellently well in this climate and are staples widely consumed in a country that has grown to depend too much on imports. Plus, investing in the agriculture sector of the Nigerian economy will surely bring you great returns on investment thanks to the required low investment capital, low maintenance cost, high returns on investment, and the fact that the government not only supports this industry but also encourages it! You can’t go wrong producing food for Nigerian consumption.
Of course investment capital is a big deal on any investor’s mind but it’s not much to worry about in Nigeria. Land, labour, raw materials and equipment mostly come relatively cheaply.
For the most part, purchasing and formally processing the papers for farmland is within affordable range, especially if you’re buying in massive quantities that allow for encouraging discounts and provide room for costless expansion in the future.
With labour laws in Nigeria virtually nonexistent and labour unions poorly organized, factors such as the recent recession, massive unemployment, and rising costs make it such that employing needed hands to work on your farm is also reasonably inexpensive.
You want to recruit a few experienced and trustworthy farmers to head your team though. You want to pay them their worth too. The agricultural sector in Nigeria is about to hit a major boom with foreign investors like the Chinese looking cash in on the yawning chasm of opportunity and you don’t want to be caught napping and lose your best hands to the farm next door simply because that entrepreneur has the good sense to offer a little more.
If you are interested in starting a cocoa farm or a palm oil plantation in Osun State, please contact DemandSupplier
Best Sectors to Invest in Nigeria – Entertainment
A 2016 article of the International Monetary Fund website reports that Nollywood (the Nigerian Cinema Industry) is easily the third largest movie industry in terms of actual number of movies produced annually, after having even exceeded keen competitors Bollywood (India) and Hollywood (United States) at some point in 2009. Obviously somebody means business with Nigerian cinema.
Granted the question of quality leaves a little something to be desired when Nigerian movies are compared to their Indian and American counterparts but even that has reportedly turned around somewhat since the 2009 release of Kunle Afolayan’s The Figurine.
Nigerian “Home Videos” now compete for international awards and recognition while popping up in several countries across the world, and also as downloadable content on websites all over the internet, bringing in millions in naira and in dollars for all stakeholders.
Nigeria’s Omotola Jalade listed on the 2013 Times 100 list with other venerable names like Stephen Spielberg and Beyoncé unquestionably puts a little sparkle to the Nigerian entertainment industry’s shine.
From an investor’s perspective, investment costs are almost negligible compared to the potential returns one could get from a local market gone global.
For as little as 5 million naira ($30,000) or even less, an entire movie can be made – preproduction, production, and post-production – and released into a market that could bring in potentially ten times the investment. And that is just film.
With names like 2Face, D’Banj, Wizkid, Don Jazzy, and Tiwa Savage growing to global recognition and even picking up a few international endorsements on the way, it’s evident – you can’t go wrong investing in entertainment.
It’s not that hard to understand – folks want to be distracted, especially when they have so many nasty things that are clawing for their attention in real life. It’s escapism, true, but it’s the same thing that grew Hollywood into what it is in present day when the Great Depression of the 1930s nearly threw the United States for a complete loop. Put in a little money, make a lot of people happy in the process, and smile all the way to the bank.
Best Sectors You Must Invest in Nigeria – Real Estate
I’ll give you this simple background on real estate as a big investment tip for the Nigerian economy: Nigerians are a proud people. We’re just different. We want our own thing and no amount of side talking is changing that any time soon – not even a recession. When I grow up in Nigeria I don’t want to live in Daddy’s house; I want to strike out on my own, rent my own apartment, do my own business, and build my own home. It’s every man’s pride. In a nation where the population is the world’s 6 largest, that’s a huge number of people moving out and needing somewhere to live.
There are two ways to invest in Nigeria’s real estate. The first is to build apartment complexes in urban regions and rent or lease them out. Even before you’re done, young’uns will come around asking how much they can have it.
This isn’t entirely unlike building a business center or row of shops and renting them out by the month or by the year, or building say an events center and leasing it out weekly for more money than you spent building it coming back into your pocket within three years. As a matter of fact, these are viable option also. The rest of it is just money – passive income – coming in to your heart’s content.
The second way to invest in the Nigerian real estate is prospecting.
You walk into a new area, relatively remote – rural even – and purchase for yourself a significant portion of land, hold onto it until it appreciates in value, and then sell it for substantial profits. Granted this is time dependent and someone in a hurry to make money may not want to wait that long, but it is reasonably foolproof.
To hasten your returns on investment however, you can develop it into something that somebody wants and sell it off – an estate, a theme park, a shopping center…Common practices in Nigeria include the laying out and partial development so that portions of it containing uncompleted buildings can be sold to wealthy Nigerians who don’t want to go through the process themselves.
To be strictly fair, the Nigerian real estate market is a baby compared to the United States and a number of other popular economies around the world.
However, according to the Oxford Business Center, the rapid population growth experienced in the country has contributed to a remarkably fast growing demand for real estate conveniences. This growth is also hastened by progressively snowballing urbanization and commercial expansion further fueled by the love for ‘my own thing’ which I described earlier.
As a matter of record, Mr. Tola Akinhanmi, Senior Manager of Real Estate Finance at Stanbic IBTC Bank spoke at a 2016 conference about growing interest and focus on investment grade assets within retail and office segments of the Nigerian Real Estate Sector because this segment is projected to experience a massive boom in coming years.
This is substantiated by various other reports, including one by North Court Real Estate, titled: Nigeria real estate market outlook 2016. This steady expansion in Nigeria’s real estate sector has been consistent for the greater part of the past decade and is expected to continue to driving growth in the industry regardless of the recession.
Best Sectors You Must Invest in Nigeria – Tourism
Tourism is almost nonexistent in Nigeria, a nation begging for opportunities to be presented to foreign persons who simply want an excuse to visit.
As yet, business and remarkably low labour costs are the primary reasons which bring foreign persons into the country from other nations. These are however people who incidentally have gotten used to hangouts and pastimes in their own homes would totally welcome the opportunity to enjoy a few distractions while in the country.
The Nigerian tourism sector is about to hit a significant boom and you are uniquely placed right now to ride that wave into incredible returns on investment.
Only December 2016 Arab entities have indicated interest in developing Nigeria’s tourism into something potentially as lucrative as anything they’ve done with their lands in Middle East. Rich in cultural diversity and ancient tradition, there are carnivals, resorts, festivals, and vacationer destinations to the end of days littered across the Nigerian landscape.
If the work done by former Governor Donald Duke in Cross River State Capital Calabar some 10-15 years ago are anything to go by, it is evident that people just need an excuse to key in to this sector for investment in Nigeria’s economy. The results speak by themselves.
The month-long Calabar Festival at the end of the year draws persons from all over the world; the Tinapa project attracts visitors year round; and the Obudu Ranch International Mountain Race brings some of the best world-class athletes with its reputation as the world’s richest mountain race.
The Kano Durbar, the Osun-Osogbo Festival, the Pategi Regatta… There is a yawning need for world-class lodgings and recreation establishments to make these events richer and plenty more profitable for persons coming into the country just to enjoy them, and you could cash in on the unique opportunities presented by the Nigerian tourism industry if you can invest wisely now.
Best Sectors You Must Invest in Nigeria – E-Commerce
Global village – the term has been used and re-used, so much so there must be a few people out and about right now to whom it doesn’t make a lot of meaning anymore.
For those who are paying attention however, this is sheer joy. In an emerging market like that of Nigeria – now the 21st largest economy in the world in terms of GDP, and 20th largest in terms of purchasing power parity (PPP) – technology is growing even faster than the rapid consciousness of the citizenry. Buying and selling over the internet is currently the thing of the day, even in Nigeria.
With smartphones in perhaps 50 million hands, internet connectivity at the fastest it has ever been, network coverage improving every other day, and the people becoming more aware, you want to position yourself uniquely to compete with some of the biggest names in online buying and selling in Africa’s biggest economy.
Konga, Jumia, Hotels.ng, Printivo and very soon ‘whateveryourbrandnameis.com’ out there on the internet offering a perfectly packaged product impeccably tailored for a targeted Nigerian demographic, pulling in the funds by the millions if you don’t chicken out because of negative perceptions that are pervasive but less than accurate.
Nigerian E-commerce entrepreneur and CEO of Hotels.ng, Mark Essien, alongside his contemporary Eghosa Omoigui of EchoVC Partners, both assert that the apparent recession observed and overly reported in Nigeria lately is only skin deep, and that on the micro level, the Nigerian economy is pretty stable and business as usual. In both their opinions, you should cash in we the market is down anyway, because then once the growth inevitably resumes you will grow exponentially with it.
In English: Nigerians want to buy online.
With Amazon.com and other global E-commerce actors needing your payments in dollars, having your package ready in the new year for Naira purchases can only do you good in the short and long runs.
So, there you have it – Our 5 Best sectors to invest in Nigeria and guess what, they are guaranteed to bring you great returns on investment. Do you know that despite all the politico-economic challenges, investing in Nigeria still gives you on the average an amazing 35% ROI?
You may not be able to do them all, but you want to mull over them for a bit and decide which you will be best suited for. In your best interest, you should be sure you that wherever you choose it is where you’ll be strongest based on your interests and capabilities.