By Charles Okeahalam, AGH Capital
Nigeria is facing a number of difficulties, most notably the absence of security in the north-east of the country where Boko Haram has killed thousands of people. Linked to this atrocity is the equally atrocious low level of civil, social and economic governance. Poor governance is correlated with social instability. It is also influenced by economic inefficiency. Therefore, only a simple or naïve analysis could attempt to wish away cause and effect.
Presidential and state governorship elections which were scheduled to take place in February have now been postponed to March and April respectively. As the elections approach we need to ask: what is the state of the Nigerian economy and what do we have to do to improve it? These are important questions that need to be addressed following the presidential election. Read more
By Melissa Cook, Africa Sunrise Partners
The headlines about Boko Haram’s deadly and vicious attacks in Nigeria threaten to overshadow what we see as considerable progress on one of the country’s top priorities: power reform and privatization. Despite ongoing challenges ranging from inadequate gas supply to funding shortfalls and antiquated wiring and transformers, the Nigerian power sector is moving full-steam ahead.
Access to electricity could be a game-changer for Africa’s largest economy. We realize that it may take years to get Nigeria’s power capacity up to the 40GW target from today’s 4-5GW (see chart). But step by step, we see barriers to business, household activity, and entrepreneurial activity dropping as power generation and distribution companies—and the government-owned transmission company—refurbish or repair assets. Read more
Nigeria has been beloved of investors lately, the accessible face of an irresistible rising demographic in sub-Saharan Africa. But it faces challenges, and none more so than the paucity of its infrastructure.
A new report this week by Ecobank spells out just how big that infrastructure gap is, and how it is replicated widely almost everywhere in mid-Africa. And it does so at a vital moment, as Nigeria is about to move to the second stage in its privatisation programme, involving the completion and sale of 10 national integrated power projects (NPPs), with a target of the end of March. Read more
You tell a lot by a country’s electricity supply – in fact, some people prefer it to GDP when it comes to assessing China. So how is Africa doing?
A new Afrobarometer survey of 34 African countries – What people want from government – has named the best and worst countries in terms of power supply in Africa. Read more
Back in September, to much fanfare, Nigerian President Goodluck Jonathan officially handed over share certificates and licenses to the handful of energy consortiums who successfully bid $2.5bn for ownership of ten distribution companies and five power generation plants.
But investors are starting to grumble about breakdowns in communication, procedural confusion and the government’s failure to properly think through how the new system will work. Read more
From an economic viewpoint, Africa’s most populous country, with about 173m people, is moving in the right direction, as the FT’s bumper Investing in Nigeria special report shows. Growth remains strong, at more than 6 per cent. Nigeria is set to overhaul its ways of calculating GDP, for the first time since 1990, to reflect more recent developments, which should bring it closer to overtaking South Africa as Africa’s biggest economy. Inflation is down to single-digits and government debt remains modest. Read more
It’s one of the great paradoxes of Nigeria. The country is Africa’s biggest oil producer, yet it relies on imported mostly on imported fuel, which it spends billions of dollars subsidising each year.
Time for the country’s richest man to step in. Read more
Fixing Nigeria’s power woes through privatisation was never going to easy. Staying employed while trying to do so seems equally challenging.
First to fall was Barth Nnaji (right), the power minister who had been credited with moving forward the privatisation process but was pressured to resign in August due a conflict of interest. On Tuesday he was followed out the door by Bolanle Onogorowa (left), head of the Bureau of Public Enterprises (BPE), the agency that oversees the sell-off of government assets. Read more
With painful irony, oil-rich Nigeria is unable to supply its own population with electricity. The country ranked 178th of 185 economies on access to electricity for new businesses in the World Bank’s latest “Doing Business” publication.
Infrastructure is, not surprisingly, a key to the country’s future development, as an FT Special Report sets out. Read more
The first stage of electricity privatisation in Nigeria has not been without controversy but the with Tuesday’s announcement of winning bids for five power generation plants in an open process with international observers, the programme is back on track. Next up: distribution and transmission.
Among the winners in the generation round are companies from 13 countries including the US, Russia and China. The sale could net up to $1bn. Read more