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Chapter | Transport from The Report: Nigeria 2019

Nigeria has seen much of its transport network fall into disrepair in the wake of unprecedented recent economic and population growth, as well as decades of underinvestment in critical transport infrastructure. Although rising passenger and cargo demand continues to strain nearly every segment of Nigeria’s transport sector, over the course of 2017 and 2018 the country has made commendable progress in alleviating urban congestion, investing in critical infrastructure projects and increasing private sector participation in the development of transport arteries. The opening of the Abuja Light Rail system, steady progress on the new terminal at Abuja’s Nnamdi Azikiwe International Airport, and rising public and private investment in the critical rail and road segments should see the transport sector become a key enabler of diversified non-oil growth, supporting Economic Recovery and Growth Plan targets as well as an ongoing macroeconomic recovery. This chapter contains an interview with Hassan Bello, Executive Secretary and CEO, Nigerian Shippers’ Council.

Chapter | Construction & Real Estate from The Report: Nigeria 2019

Although currency volatility and a recession in 2016 impacted private sector investment, public spending on new infrastructure has surged in recent years, and is expected to rise again for the remainder of 2018 and into 2019. However, public funds do not suffice to close the country’s widening infrastructure deficit, something that has led the government to increasingly target private sector investment to launch new projects. In addition to successful bond issuances that should relieve budgetary constraints and boost transport spending, the authorities have moved to increase the deployment of public-private partnerships to deliver big-ticket projects, a strategy that has had considerable success, and should keep the industry on the path towards positive growth going into 2019. Meanwhile, the real estate sector is set to stabilise in 2018 as markets absorb new supply, and macroeconomic indicators improve. The 2018 budget boosted public spending by 16% from 2017 levels, with a significant portion of funding channelled into new projects under the Federal Ministry of Power, Works and Housing, as well as the Federal Ministry of Transportation. This chapter contains interviews with Babatunde Fashola, Minister of Power, Works and Housing; and Paul Onwuanibe, CEO, Landmark Africa.

Chapter | ICT from The Report: Nigeria 2019

Nigeria’s ICT sector has faced several challenging years, with rapid currency depreciation and a macroeconomic slowdown weighing on profitability. However the sector remains a critical non-oil growth driver and major contributor to the economy, supported by a sizeable young population and the rapid adoption of mobile internet services. Dominated by four large mobile operators, the telecoms industry remains on a steady growth trajectory, as rising smartphone penetration and investment in mobile internet networks supports a shift towards data-driven growth models. In the IT sector government efforts to boost broadband penetration have begun to gather steam, although the country will face a number of challenges in achieving its ambitious mid-term expansion targets owing to issues in deploying new fibre-optic infrastructure. This chapter contains an interview with Umar Danbatta, Executive Vice-chairman and CEO, Nigerian Communications Commission.

Chapter | Capital Markets from The Report: Nigeria 2019

Despite multiple trading platforms, a variety of debt instruments and a range of institutional investors, both domestic and foreign, Nigeria’s capital markets are relatively underdeveloped, accounting for only 11% of GDP in 2017, compared to a global average of 98.5% in 2016. Additionally, the authorities have not yet solved investors’ liquidity challenge and most domestics firms’ difficulties accessing finance. Furthermore, Nigeria wants to use capital markets to raise funds for infrastructure, the need for which is greater than what the federal budget and funding mechanisms are able to provide. Reforms to the sector are expected to play a role in infrastructure development in the near future, as new rules for pension funds are set to allow individual account holders to select risk-based investment approaches. This chapter contains interviews with Oscar N Onyema, CEO, Nigerian Stock Exchange; Ibukun Adebayo, Head of Middle East, Africa and South Asia, International Markets Unit, London Stock Exchange Group; Kayode Akinkugbe, Managing Director and CEO, FBNQuest Merchant Bank; and Chinua Azubike, Managing Director and CEO, InfraCredit.

Chapter | Retail from The Report: Nigeria 2019

Following a decade-long period of growth, in which formal retail supplies more than tripled, Nigeria’s retail sector faced several challenging years. Macroeconomic volatility, a recession in 2016 and the naira’s rapid depreciation impacted retailers and consumers alike. Likewise, both purchasing power and household incomes declined, while input costs and vacancy rates simultaneously increased. Despite these recent economic challenges, the country remains one of Africa’s most attractive retail investment destinations for local and foreign investors. As retailers move to capitalise on opportunities in the sector, stakeholders anticipate that developers will increasingly shift their strategy towards smaller, localised retail developments offering essential grocery, pharmaceutical and clothing items. In the longer term resurgent middle-class growth, supported by improving oil prices and strengthening macroeconomic fundamentals, should see a return to large-scale, high-end regional and mixed-use retail centres. This chapter contains an interview with Olaide Agboola, Managing Partner, Purple Capital.

Chapter | Banking from The Report: Nigeria 2019

Nigeria’s banking sector is a diversified one, in which the largest banks follow the universal banking model and a range of specialised actors tap specific niches. New trends include merchant banks, sector-specific lending vehicles, and from policymakers, increased focus on financial inclusion. These include microfinance, mobile tools, and the establishment of a network of mobile money agents to service this developing financial infrastructure. For now, however, the banking sector features a slate of risks that leaves banks reluctant to lend to the private sector, and economic actors of most types suffer from inadequate access to finance. Despite this, overall performance is not expected to slide due to the counteracting improvements in the economy. This chapter contains interviews with Godwin Emefiele, Governor, Central Bank of Nigeria; Abubakar Jimoh, Managing Director and CEO, Coronation Merchant Bank; and Emeka Emuwa, CEO, Union Bank.