The latest report by Nigerian data company, Mustard Insights, has revealed the staggering impact of economic headwinds on businesses operating in Nigeria.

The report, titled Nigeria’s Business Survival Report 2024: Strategies for Sustainable Business Growth Amid Economic Turbulence, highlights that 43.7% of business owners were forced to reduce their workforce in 2024, underscoring the severe strain that economic disruptions have placed on companies across various sectors.

This revelation paints a grim picture of Nigeria’s job market, reinforcing widespread belief that the country’s actual unemployment rate is far higher than the figures reported by the National Bureau of Statistics (NBS).

“Similar to survey insights where raw material cost was identified as the highest cost element (input costs), analysis of NGX companies reveals a significant increase in costs in the year 2024 compared to 2023 compared to the rise in direct costs from 2022 to 2023,” an excerpt of the report reads.

The Mustard Insights report also highlights that among Nigeria’s top-listed companies on the NGX-30, there was a sharp rise in direct costs in 2024 compared to previous years. In the period between 2022 and 2023, around 70% of listed firms saw an increase of less than 50% in their direct costs.

However, by 2024, a dramatic shift had occurred, with 80% of companies reporting a 51% to 100% rise in costs, and the remaining 20% experiencing increases of more than 100%. This exponential surge in costs has left businesses in a precarious position, struggling to maintain profitability amid rising operational expenditures.

The findings of the report shed light on the dire state of Nigeria’s economic climate, where businesses are left with few viable options for survival. The widespread job losses, the scaling back of operations by major corporations, and the retreat of multinationals all point to a worsening economic crisis. The private sector, which should be a key driver of employment and economic growth, is under immense pressure, leading to a slowdown in investment and business expansion.

The extent of job losses recorded in 2024 signals a significant rise in unemployment, further compounding the financial distress faced by many Nigerians. The situation has been worsened by a wave of business closures, with even well-established multinational corporations either shutting down their Nigerian operations or exiting the country entirely.

The mass exodus of major firms is a testament to the difficult operating environment characterized by rising inflation, currency devaluation, prohibitive business costs, and an overall decline in consumer purchasing power.

The economic downturn, intensified by the removal of fuel subsidies and the devaluation of the Naira, has severely impacted the cost structure of businesses. Many companies have seen their direct costs soar, driven by surging expenses for raw materials, transportation, energy, and wages. According to Mustard Insights, corporate earnings have been significantly eroded, forcing businesses to make difficult decisions such as downsizing their workforce, scaling back expansion plans, or, in extreme cases, shutting down operations altogether.

The financial burden on companies has also been reflected in the rising cost of goods and services, with 65% of businesses admitting to increasing their prices in an attempt to offset the rising expenses. However, this has only worsened the situation for consumers, who are already grappling with an all-time high cost of living. Inflation, which surged to 34.80% by December 2024 according to the NBS, has further squeezed disposable incomes, leaving many Nigerians struggling to afford basic necessities.

As businesses continue to battle rising costs, multinationals that once viewed Nigeria as a lucrative market have been retreating. Over the past year, companies such as Procter & Gamble (P&G) and GlaxoSmithKline (GSK) announced their exit from the Nigerian market, citing harsh economic conditions that have made it difficult to sustain operations.

In the retail sector, Shoprite, which had been a dominant player for years, completed its phased withdrawal from the country, pointing to dwindling profitability and operational challenges. Similarly, in the financial services sector, some foreign banks and fintech firms have scaled down their operations due to the unfavorable regulatory and macroeconomic climate.

Industry analysts warn that unless the Nigerian government implements urgent and effective policy measures to stabilize the macroeconomic environment, more businesses could shut down in 2025, leading to even higher unemployment and a deeper economic crisis. While some businesses are attempting to navigate the storm through cost-cutting strategies, automation, and diversification, the long-term sustainability of these measures remains uncertain due to the current trajectory of the economy.

United States President Donald Trump has frozen aid to South Africa in an escalation of a growing diplomatic rift between his administration and Pretoria over a controversial land expropriation law aimed at tackling inequality stemming from apartheid.

In an executive order signed on Friday, Trump condemned the law, describing it as a “shocking disregard” for citizens’ rights and claiming it would allow the government to seize land from ethnic minority Afrikaners without compensation. His administration argues that the Expropriation Act, signed last month by South African President Cyril Ramaphosa, follows “countless” policies designed to dismantle equal opportunity, as well as “hateful rhetoric” and government actions that have driven violence against “racially disfavored” landowners.

Trump further linked his decision to broader foreign policy grievances, accusing South Africa of taking “aggressive positions” against the US and its allies. He cited Pretoria’s accusation of genocide against Israel at the International Court of Justice (ICJ) and its strengthening of relations with Iran as examples of policies that undermine Washington’s interests.

“The United States cannot support the government of South Africa’s commission of rights violations in its country or its undermining [of] United States foreign policy, which poses national security threats to our Nation, our allies, our African partners, and our interests,” Trump stated.

His decision follows a series of increasingly hostile exchanges between the two nations. Since Sunday, Trump has accused Ramaphosa’s administration of “confiscating land” and mistreating “certain classes of people.” US Secretary of State Marco Rubio escalated tensions on Wednesday by announcing he would boycott the upcoming Group of 20 (G20) talks in Johannesburg, citing South Africa’s land policies and other “very bad things” happening in the country.

Ramaphosa Defiant, Downplays US Aid to HIV Program

In response to Trump’s threats, Ramaphosa has remained defiant, insisting that South Africa will not bow to external pressure. Earlier this week, he addressed concerns over the potential impact of the aid withdrawal, particularly regarding health funding. The United States is a major contributor to South Africa’s HIV response program, but Ramaphosa dismissed the significance of the support, noting that it only accounts for 17 percent of the country’s total HIV budget.

His comments signaled that Pretoria does not view US financial assistance as indispensable, suggesting that the country is prepared to continue its fight against HIV/AIDS with or without Washington’s support.

“We will not be deterred. We are a resilient people. We will not be bullied,” Ramaphosa stated in an address to Parliament on Thursday.

Under the expropriation law, the South African government may seize land without compensation where it is deemed to be “just and equitable and in the public interest,” such as in cases where land is unused, and after efforts to reach an agreement with the owner have failed. Ramaphosa and the ruling African National Congress (ANC) argue that the legislation is necessary to address the vast disparities in land ownership stemming from colonial rule and apartheid. However, no land has been expropriated under the law so far.

Pretoria Believes Musk Is Behind Trump’s Retaliation

While Trump has framed his decision as a response to human rights violations and South Africa’s foreign policy stances, officials in Pretoria believe there is another factor at play: Elon Musk. South African authorities suspect the billionaire, a vocal supporter of Trump and a fierce critic of the ANC government, has played a role in influencing Washington’s hardline stance against Pretoria.

The speculation arises from Musk’s ongoing faceoff with South Africa over its refusal to grant a license to his satellite internet service, Starlink. The country has stood firm on its requirement that Starlink must partner with a local service provider to operate legally, a move Musk has openly criticized as unnecessary regulatory red tape designed to stifle competition. With his satellite network expanding rapidly across the globe, Musk has grown increasingly frustrated with South Africa’s resistance, and Pretoria believes his influence within Trump’s inner circle may have contributed to the US decision to freeze aid.

Musk, who was born in South Africa but has long severed ties with the country, has frequently used his platform to attack the ANC government. His criticism intensified after the government rejected Starlink’s application, with Musk accusing South African authorities of preventing citizens from accessing free-market solutions to internet connectivity. His comments have resonated with Trump, who has a history of aligning with Musk on various policy issues, particularly in opposition to regulatory oversight.

The decision to freeze aid has reignited debates over land ownership and racial inequality in South Africa. Land distribution remains one of the country’s most contentious issues, given the enduring legacy of apartheid. While Black South Africans constitute over 80 percent of the population, they own just 4 percent of privately held farmland, according to a 2017 government audit. In contrast, White South Africans—who make up about 7 percent of the population—control roughly three-quarters of the land.

Critics of the expropriation law, including opposition parties such as the Democratic Alliance (DA), warn that the policy could deter foreign investment and lead to economic instability. The DA, which draws most of its support from white, Indian, and multiracial South Africans, has also expressed concern about Trump’s retaliation but rejects claims that the law allows arbitrary land seizures.

Trump’s broader crackdown on foreign assistance adds to the controversies. His administration has been aggressively reducing foreign aid, including dismantling the US Agency for International Development (USAID). According to the most recent data, Washington allocated approximately $440 million in aid to South Africa in 2023.

Despite the potential economic ramifications, Ramaphosa’s government appears determined to move forward with its policies. With tensions mounting between the two nations and suspicions growing over Musk’s role in the dispute, the standoff between South Africa and the United States is unlikely to be resolved anytime soon.

In an unexpected admission, OpenAI CEO Sam Altman acknowledged on Friday that his company has been “on the wrong side of history” when it comes to transparency in artificial intelligence (AI).

The statement, made during an Ask Me Anything (AMA) session on Reddit, marked a significant shift in the ongoing debate about whether AI models should be open-source or closely guarded by private companies.

“I personally think we have been on the wrong side of history here and need to figure out a different open-source strategy,” Altman wrote in response to a question about OpenAI’s lack of transparency. However, he noted that “not everyone at OpenAI shares this view, and it’s also not our current highest priority.”

Altman’s comments come at a time when OpenAI is under increasing pressure from open-source AI competitors, particularly China’s DeepSeek, whose rapid advancements have rattled Silicon Valley and the global tech industry.

The Rise of DeepSeek: China’s Open-Source Disruptor

DeepSeek, an AI startup founded by a team of former Tencent, Alibaba, and Tsinghua University researchers, made headlines in late 2024 with the release of its R1 chatbot. This model offers performance comparable to OpenAI’s GPT-4 at a fraction of the cost.

But what truly set DeepSeek apart was its open-source approach. Unlike OpenAI, which has moved toward a closed, commercial model, DeepSeek positioned itself as a public-spirited AI initiative that allows developers worldwide to freely access and modify its technology.

DeepSeek’s move was immediately seen as a direct challenge to OpenAI, Google DeepMind, and other Western AI leaders. While OpenAI and Google justify their secrecy as a way to protect intellectual property and prevent AI misuse, DeepSeek has argued that openness fosters greater innovation and trust in AI.

The impact of DeepSeek was felt almost overnight. Within weeks of its release, major AI developers, startups, and universities began experimenting with DeepSeek’s open-source models, reducing their dependence on OpenAI and Google’s proprietary systems.

Even government agencies and corporations in Europe, India, and the Middle East started exploring DeepSeek as an alternative, citing concerns about U.S. tech dominance and data sovereignty.

DeepSeek’s rise sent shockwaves through Silicon Valley. While Meta, Mistral, and some other AI firms have embraced open-source models to varying degrees, the established giants—OpenAI and Google DeepMind—have remained committed to closely guarding their AI breakthroughs.

However, as DeepSeek demonstrated that high-performance AI can be built and shared openly, it forced a broader industry reckoning. Suddenly, OpenAI and Google were no longer the only players in town, and their dominance in the AI space looked more vulnerable than ever.

During his Reddit AMA, a user directly asked Altman whether DeepSeek’s success had changed OpenAI’s plans for its future models.

“It’s a very good model,” Altman admitted, referring to DeepSeek’s technology. “We will produce better models, but we will maintain less of a lead than we did in previous years.”

This was a striking acknowledgment. OpenAI, which once enjoyed an undisputed lead in AI innovation, now faces the reality that competitors are catching up—and fast.

The Battle Between Openness and Secrecy in AI

The debate over open-source vs. closed AI has become one of the most contentious issues in the tech world. Proponents of open-source AI argue that transparency is essential for accountability, security, and global collaboration. They point out that AI models trained in secrecy can be vulnerable to bias, manipulation, and ethical concerns that might go unchecked without public scrutiny.

On the other hand, companies like OpenAI and Google argue that keeping AI proprietary is necessary to prevent misuse and maintain economic incentives for further innovation. OpenAI, in particular, has shifted from its original open-source mission to a for-profit model backed by Microsoft, citing the need to balance safety with commercial success.

Meta, Mistral, and DeepSeek have challenged this view by releasing open models, claiming that AI should be treated like a global utility rather than a corporate product.

Will OpenAI Change Course?

Altman’s statement suggests that internal divisions exist within OpenAI about its future direction. While he appears open to revisiting OpenAI’s approach, he admitted that it is not a top priority for the company at the moment.

This may be because OpenAI is deeply entangled with Microsoft, which has invested billions in the company and integrated OpenAI models into its products like Azure and Copilot. If OpenAI were to shift toward open-source AI, it could risk undermining its business model and straining its relationship with Microsoft.

Meanwhile, DeepSeek and other open-source challengers show no signs of slowing down. Analysts believe that if they continue to gain traction, OpenAI may have no choice but to adapt—or risk losing its leadership position in the AI race.

Meanwhile, OpenAI will be receiving more investment funds from Japan’s SoftBank.

OpenAI may have a new top backer. Japanese investment firm SoftBank is set to invest $40 billion in the artificial intelligence startup, CNBC reports, citing anonymous sources. The deal would value OpenAI at $260 billion and edge out LinkedIn’s parent company, Microsoft, as OpenAI’s largest investor. The cash infusion is expected to provide additional funding for the previously announced Stargate project, a venture by OpenAI, SoftBank and Oracle that aims to build AI computing centers across the U.S.