BUSINESS OPPORTUNITIES IN NIGERIA11 July, 2023
Business opportunities in Nigeria
Nigeria, Africa's largest country, is rapidly establishing itself as one of the most potential business locations in the world. Being a flourishing economy, Nigeria offers multiple sectors that are ripe for development and investment. In this article, we'll look further into the business possibilities in Nigeria and provide valuable insights. The information will help you thrive in the Nigerian business climate, whether you are an experienced trader, manufacturer, or investor keenly looking to make an entry.
Agriculture and Agribusiness
Among the most potential business areas in Nigeria are agriculture and agribusiness. Nigeria can become a significant agricultural powerhouse due to its extensive, fertile territory and big populace. Due to its sizable populace and vast, fertile environment, Nigeria can develop into a significant agricultural powerhouse. According to the World Bank, agriculture employs about 70% of the population in Nigeria and accounts for about 23.7% of the country's GDP. Cassava, yams, rice, corn, sorghum, millet, legumes, oil palm, cocoa, groundnuts, and rubber are just a few of the various products produced in Nigeria. For companies seeking to invest in Nigeria, the wealth of these products and the country's potential for development in the farming sector offer a sizable chance.
Investors have a perfect location in the Lagos Free Zone to take advantage of this possibility. It is situated on the Lekki Peninsula and provides access to high-quality facilities, land, and a sizable consumer market, creating a favorable climate for companies involved in agribusiness. The Lagos Free Zone is a strategic location for prospective investors because it provides an ideal industrial ecosystem for agribusinesses to setup processing plants and export hubs for international markets.
Manufacturing and industry
Nigeria's economy depends heavily on manufacturing and industry. Oil, gas, and solid minerals are just a few of Nigeria's natural resources that supply the materials for various industrial sectors like construction, chemical, and textile. The Nigerian government has identified agriculture, manufacturing, solid minerals, and services as priority sectors for investment. According to the Ministry of Mines and Steel Development, Nigeria has over 44 mineral types in over 500 locations. These include gold, coal, limestone, and iron ore.
(Source: Ministry of Mines and Steel Development.)
Highlights of few of the abundant solid mineral deposits below:
As for investment opportunities, the Nigerian government has established the Nigerian Solid Minerals Development Fund to finance mining projects in the country.
(Source: Nigerian Investment Promotion Commission.)
There is no denying that Nigeria is a country rich in natural resources, including sizable mineral and solid material reserves that are just ready to be exploited. Nigeria has over 44 known kinds of minerals in over 500 places, including gold, iron ore, coal, tin, and many more, according to the Ministry of Mines and Steel Development of Nigeria. Investors have the chance to take advantage of an abundance of opportunities and support Nigeria's economic development thanks to these resources. Nigeria's mineral industry can significantly contribute to the nation's wealth with the proper investments and alliances. The Nigerian government has designated several areas for investment and development, including agriculture, industry, substantial resources, and services, to expand its economy away from reliance on Oil & Gas exports. Through the Nigeria Export Processing Zones Authority, the government also promotes business in approved Free Zones. (NEPZA). The goals of these initiatives are a more welcoming atmosphere for businesses and the advancement of Nigeria's economy. With the availability of both dry bulk and container cargo handling facilities at Lekki Port, investors from the mines & mineral sector can now export both unprocessed and processed minerals from their base at the Lagos Free Zone.
The Nigerian government has enacted several measures and policies, such as tax incentives and import substitution laws, to encourage the expansion of the industry. Nigeria is presently thought to have a population of around 220 million, making it the most numerous nation in Africa and the seventh most populous nation overall. Furthermore, according to UN estimates, Nigeria could have a population of more than 400 million by 2050, making it the world's third-most populous country. This sizable and growing populace creates chances for businesses seeking to engage in Nigeria's economy by offering a sizable market for goods produced in the nation. Due to the market's sizable consumer base, companies can use it to provide their goods, promoting economic growth and advancement.
Technology and innovation
Back in 2012, the Ministry of Communication Technology drafted the National Information and Communication Technology Policy as a bold step towards a brighter future. They hoped to pave the path for Nigeria's transformation into a vibrant and prosperous knowledge-based economy by taking this courageous move.
The policy was more than simply a text; it was a beacon of hope, inspiring optimism among Nigerians. People imagined a future in which cutting-edge technologies and novel ideas would power the country's growth and prosperity. The policy functioned as a rallying cry for all Nigerians to band together and strive towards a common objective of constructing a brighter future.
Nigeria is a country with enormous potential, with a youthful populace ready to make their imprint on the world. You are not just tapping into a profitable market when you engage in the BPO business; you are also empowering a new generation of Nigerians to fulfil their full potential.
Furthermore, Nigeria's BPO industry provides several benefits, including a trained labour, reasonable costs, and a favourable business climate.
Nigeria's technology and innovation industry presents an exciting opportunity for investors and company owners, particularly in the following subsectors:
- Smart tech: Nigeria's extensive and expanding smartphone user base creates a sizable mobile banking and payment services market. With cutting-edge companies providing various financial services, from smartphone payments to digital loans, Nigeria's fintech sector is expanding quickly.
- E-commerce: Nigeria's growing middle class and rising internet usage offer e-commerce companies a sizable market. There is a lot of scope for expansion in the online retail market in Nigeria, where Jumia and Konga are already well-known.
- Software development: Nigeria's software development business is expanding because of the sizable group of skilled software workers and the rising demand for digital solutions. Nigerian tech startups are developing creative answers to regional problems, from smartphone applications to enterprise software.
Energy and Power
Nigeria's economy is highly reliant on energy and power as it is the world's 15th most extensive supplier of crude oil and the largest in Africa. But Nigeria also aims to broaden its energy balance, relying less on fossil fuels and increasing its use of green energy sources. Nigeria's energy and electricity sector presents a significant opportunity for investors and entrepreneurs, particularly in the following subsectors:
- Renewable energy: There are many different sustainable energy sources available in Nigeria, but the most common ones are sun, wind, biomass, and small hydropower (SHP). To encourage investment in the production of green energy in Nigeria, the Nigerian Electricity Regulatory Commission (NERC) has committed.
- Exploration and gas production: Nigeria is one of the top gas-producing countries in Africa due to its abundant natural gas deposits. Hence, Lagos is implementing sustainable initiatives like Lagos Greening and Lagos Solar Project for a greener, more energy-efficient city.
Nigeria's power situation is characterised by an unpredictable supply of energy. The country has power outages, which have a significant influence on enterprises, industries, and everyday life. Currently, Lagos Free Zone is running a 50 kW proof-of-concept (POC) rooftop solar system. Further, the local factory's energy supply is provided by a 7 MW gas-fired generating system provided by a third-party source. Our goal is to shift to a cleaner energy landscape by 2030-2035 by generating solar power on all rooftops inside the zone, contributing to the distribution network. Furthermore, the facility will generate blue hydrogen as an alternate fuel source. The ultimate goal of LFZ is to reduce carbon footprint by half by 2030, with the goal of being totally green between 2030 and 2035
Real estate and Construction
We are proud to be serving global brands like BASF, Kellogg’s, Colgate, Arla, Dufil, Lekki Port among others as our current tenants.