The dwindling oil price has created lots of opportunities in some of the oil producing African countries especially Nigeria where oil is the major source of foreign exchange for the economy and this has created so much demand for the dollar, making the Naira depreciate from N165/$ in 2013 to N380/$ in 2016 at the parallel market. This has hit hard on importers in terms of the cost of importation. Now the questions is what goods are affected? Everything! as Nigeria hardly manufactures anything, In spite of her great wealth of raw materials, the country has nothing to show for it. Nigeria has depended solely on importation; every refined oil is imported despite exporting crude oil.
The most developed nations around the world produce finished products and export them to other nations who only consumes.
For most of us who have seen the opportunities created by the oil slide, and Nigeria with population of over 170million people who need food, clothes and accessories, drinking water, housing, transportation, good healthcare system, education etc. I am sure you are beginning to see the opportunities. Everything I mentioned above are in short supply and can hardly go round the whole population because we depend on importation, now that the Naira is on a free fall, importation has become more expensive as dollar is in short supply since oil prices are going down, we can comfortably say that the Nigerian naira slide is directly proportional to the drop in price of crude oil. With the dwindling oil prices, African countries are beginning to see the need to be self-dependent.
I am going to share some opportunities that have been opened up by this economic downturn for Nigerians and other investors. There is no doubt the oil/dollar situation has created economic hardship for Nigerians and Africans at large.
I am going to try and do a lay man’s calculations e.g. Lagos state has a population of over 20million people, that means 20million people will need to eat. Assuming that everybody spends N200 daily on food which is less than a dollar anyway that’s means
20,000,000 X 200 = N4,0000,00,000 ($20million USD) spent on food daily in Lagos State, wow that’s huge
Which will come to N120B in a month and N1.44Trillion ($7.3Billion) in a Year? What you will ask yourself is who is taking a large chunk of this money home? No wonder foreign investors are rushing to Africa especially Nigeria.
below I have tried to identify some areas that are worth looking into even though its not exhaustive
1. Agriculture: this is the key to self-sufficiency for Nigeria and Nigerians, and also has high potential for foreign exchange for exporters of raw materials and finished products especially export to other African companies. We have companies now who export agricultural products outside this country and earn foreign exchange, in addition they also get export grants from the Nigerian Export Promotion council when you file your report read more form the NEPC website http://www.nepc.gov.ng/ they help with free consultations and seminars for exporters and potential exporters.
Some few opportunities under Agriculture are;
- Farming: these are those who farm or produce the raw materials, the Major and most lucrative farming in Nigeria are
- Rice Farming
- Cassava Farming
- Plantain Farming
- Beans farming
- Poultry Farming
- Maize Farming
- Fish farming – Cat Fish etc.
- All these areas have high return on investment if done in the proper way. To go into this you will need to understand the business before you venture in (research).
- Processors: this is the processing of the harvested products from the farmers, if you are a farmer, you can also increase your ROI if you process your farm produce than selling them as raw materials only, those who process make more money that the farmers as they process into raw materials or finished products. Like Cassava can be processed into chips and flours which can be used for different products. There are a lot of companies who are looking out for suppliers of cassava chips and Rice farmers. You could also process tomatoes, corn etc. as most of the processed foods are imported.
- Suppliers: a supplier you can actually decide to supply agricultural products spices etc. to restaurants and hotels, know of a company in Nigeria who what they do is to supply spices to major hotels in Nigeria. And their business runs into 100 of millions. Fast food companies need daily supply Cabbage, lettuce carrots, onions etc. daily.
2. Crafts, wood work, Leather works and clothing: there are a lot of opportunities in these areas, we now have people going into shoe making and manufacturing of leathers wears, accessories and clothing. In Nigeria we need people who will go into mass production of all these items in order for us to be self-sufficient and also start exporting to other African countries and the world, this will totally cut down the importation of second hand items. This has made Africa a dumping ground used items. Furniture and wood works are also very lucrative if you can add a quality finishing touch and be creative
3. E-commerce: this a billion dollar industry this sector is still very new in Nigeria and is fast growing, with more people preferring to buy items online, you don’t even need an office to start an eCommerce business, also we have businesses who are hungry to go online and sell their products.
4. Logistics: with the growing number of eCommerce companies, the logistics and delivery industry is a N10billion naira business with lots of untapped potentials. Companies are looking for logistics companies to partner with that will deliver with speed to their growing number of online customers. E-commerce companies are now resorting to setting up their own delivery company.
5. Low Cost housing-Real Estate: in Nigeria there is need for organizations who will begin to develop low cost housing the carter for the Middle and the lower class.
6. Software Solution providers : The need for software solution providers is rising with the increase and adoption of technology in most start up and SMEs organisation in Nigeria and Africa. Technology has shown to be a business enabler and a must for most organisations and start ups, if they desire to compete favourabely with their peers in the same space.
7. Social media Advertising; just thought I should mention this area as a lot more organisations are adopting the social media as the place to advertise their products and solutions, if you understand this space, you can take advantage of this, always remember the social media has the biggest population of people in the world in just one location.
There are lots of opportunities out there in Nigeria the biggest market in Africa, if you need further information on how to get quality information on any of these areas just email me and I will be glad to help out.
Please leave a comment.
Lawrence is a Cards, Payments, Project Management and Sales Expert with over 16years in the Financial Sector. He is passionate about Excellence, Leadership and Innovation, currently chasing interest in digital Payment solutions, blockchain technology, financial Inclusion & tech startups.
Author of the book, Discover, Develop, Deploy
Lawrence has founded several businesses including a Licensed Fintech in Nigeria. He loves writing and sharing knowledge with his audience.
You can reach him on any of his social media handles for enquiries and collaborations.