Nigerian music is bright spot in recession-hit economy

The lack of diversification in the Nigerian economy is among the country’s biggest challenges, according to AfriCapital CEO Dele Babade.
The head of the financial advisory firm said on Thursday that this was constraining trade with SA, adding that compared with Nigeria, SA had a long history of dealing with multinationals.
Speaking at the South Africa-Nigeria Banking and Finance Forum 2016, he said both SA and Nigeria had their own comparative advantages, but it was difficult for Nigerian companies to enter markets and operate against established brands, many of which were South African.
There was a need for Nigerian companies to find their own competitive advantage, Babade said. "Nigerian music and entertainment is crossing borders and SA can’t replicate that."
Babade said Nigeria needed to move up the value chain, instead of just exporting raw materials.

Hywel George, director of investments for Old Mutual Investment Group, said the company had seen gaps in Nigeria compared to its presence in other African countries.
But Old Mutual was "really getting going" in the country, investing in agriculture and other sectors with a local partner — a move George described as a necessity if one was going to do business in the country.
Babade said Nigeria was experiencing a shock due to the prevailing recession in the country arising from the drop in the price of oil. However, the current downturn could breed more diversification in the economy.
Babade said South African companies operating in Nigeria were not under the radar, as many Nigerians were starting to demand that foreign enterprises become more integrated in the local economy and show "mutual respect".
George said Old Mutual was considering listing on the Nigerian stock exchange in the coming years.
He said while a listing on the JSE often precluded a company from seeking any other listing, the move to list on another African exchange was a reflection of being pan-African.
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