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Lessons the National Assembly Should Learn from Anambra Lawmakers on Luxury Cars

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The decision of the members of Anambra State House of Assembly, to turn down the proposal of purchase of Prado Jeeps at the cost of N1 billion has received a lot of encomiums.

It was reported that Anambra State Governor, Willie Obianor, had planned to give the cars to the lawmakers as gift.

But the members of the state assembly opted for Innoson Vehicles instead, saying it would save cost and add vigor to the economy.

The South East and South-South Governments had agreed in an economic summit, to patronize locally made goods in order to augment the economy of the zones. In line with this agreement and the need to save cost, the lawmakers have taken their stand.

Their decision to go Innoson has been praised as it resonates with principles of good leadership set out by the preceding Governor Peter Obi. It also serves as an example in a country where such traits are rare.

A week ago, the news broke that the National Assembly is proposing N5.5 billion for cars. A development that has stirred outrage among the people because the same government is crying lack of fund to implement the basic infrastructures needed in the country.

The criticism that trailed the announcement did not deter the lawmakers, neither did the obvious infrastructural decays gaining momentum on the daily. In fact, the Senate President, Ahmed Lawan, said it is an insult to the senate that Nigerians are complaining about such a huge sum. After all, the cars are going to be used in the interest of the country.

All these are taking place at a time when Nigeria’s foreign debt is at $25.6 billion, and the external debt is over $21.04, and the Government is in talks with the World Bank for a fresh $2.5 billion loan. The over N13.5 million running cost per a lawmaker in the National Assembly is taking over 25 percent of the annual budget. And basic infrastructural amenities are at the receiving end of the brute spikes.

Nigerians are urging the National Assembly to learn from Anambra lawmakers in cutting the cost of governance and putting the country first. If at all there is a justifiable reason to spend such a whopping sum on vehicles, local producers should be patronized to boost the economy.

Nigerian made car (source: Innoson)

The 8th senate was famous for its slogan, “Buy Naija to grow the Naira,” invented to encourage patronage of locally made goods and services. It is clear that unlike in many other commodities, the Nigerian Government is not going to ban foreign made vehicles in order to promote locally made ones.

Nigerians have thus urged the governments, especially the National Assembly to set a patriotic example by buying from Innoson Vehicles Manufacturing, or enact a law making governments’ patronage of local producers compulsory.

The Village Cooks for WeWork

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An African proverb is clear – “no man, no matter how wealthy, can prepare enough food for his kinsmen, but if those kinsmen make food for him, he will be unable to consume the whole food”. That proverb is not saying that Dangote cannot feed his village kinsmen in Kano for an evening. Rather, the proverb is drawing on the strength that comes from unity and the “wisdom of many”. 

In the Igbo nation (Southeast Nigeria), parents name their children “Igwebuike” [strength in many] because despite the success of any person, the real strength comes in teamwork. The elders conclude by saying that no matter how big an iroko tree is, it can never be called a forest because a forest requires having many “trees”. They always drop that proverb when they task successful people to help others rise because without others coming up, there will not be a community.

(Sure, I agree that many have turned things upside down by requesting you upgrade pronouns in addressing them. So, you address a man as “Unu abiala” [Have you people come] even when only one man is standing before you. Yet, that one man cannot make a forest even though he is a big man (in body size) and certainly wealthy.)

That brings me to the news that the CEO of WeWork, Adam Neumann, has resigned, though he remains as non-executive chairman of parent company We. WeWork is a real estate company in U.S. but with digital nativity, and has lost billions of dollars since its founding,. Yes, the difference between it and a typical real estate is the same as the one between twelve and a dozen. Sure – it rocks and is extremely exciting.

Major layoffs are all but inevitable at high-flying real estate startup WeWork after Adam Neumann succumbed to pressure today to step down as CEO and take the role instead of non-executive chairman of the company he cofounded nine years ago.

Two well-placed sources tell us that the scope is likely to be massive, and includes some of of its newest business divisions, which these same sources anticipate will be jettisoned to get the company’s focus back on its core business. One of these sources speculates that over time, up to half of WeWork’s 15,000 employees — 9,000 of whom have been brought on in the last two years — could be laid off to shore up the unprofitable company’s expenses. The sentiment echoes a new piece in The Information that reports a “group of executives from WeWork’s parent company and bankers” have discussed laying off as many as 5,000 employees—a third of its workforce.

WeWork’s valuation rose to $47 billion driven by the backing of Japan’s SoftBank. But as WeWork went public, public investors (“the people”) started seeing what they did not like. Within days, the company valuation fell from $47 billion to $19 billion to even $3 billion (if you believe the Financial Times). What happened? WeWork leadership carelessness on corporate governance.

This brings me to We Company, the parent of WeWork, a quasi-technology real estate company that operates mainly in U.S. We Company last raised private capital at a valuation of $47 billion. It wanted to go public and had filed paperwork with road shows planned. But it has many governance issues, triggering scenarios that its public valuation could fall below $20 billion. So the road show is cancelled and the IPO is postponed, the Wall Street Journal notes..

Now, SoftBank is possibly going to lose billions of dollars (in the interim); other investors will also have red eyes. Yet, you cannot claim that these companies and the extremely “brilliant investors” did not see the mess. But they ignored everything, hoping they could package the mess for the public investors to swallow for them.

No man can cook enough food for his whole village. But a village can always cook more than enough for a man. The point is this – never really think that these investors from all those great brands are smarter than “all of us”. Yes, do not be intimidated because the WeWork case has shown one thing: no one can understand any company until the village has tasted its food.

WeWork’s food is not tasting great at the moment; it has taken the meal back home with the IPO temporarily frozen. It plans to go back, update its recipes and return in the near future to the public market. But the damage has been done to the brand: most investors will not taste any meal coming from WeWork in the very near future.

Do the right thing – and always remember the brethren; all of them, as a tribe, will always be smarter than you!  The market is smarter than WeWork investors. Simply, for WeWork, there is no winner here as they have just lost a leader and possibly imperiled the company in the process. Uber has not recovered, in many ways, since the founder, Travis Kalanick, left; WeWork may experience the same decline as Adam departs. 

For years, he convinced private investors that WeWork, a company that leases space from landlords, renovates it, slices it up into offices, and rents them out at a premium, was worth more than every other office-rental company. It was Neumann’s charisma, conviction, and unfettered ambition—he has spoken about WeWork Mars, running for president of the world, and becoming the first trillionaire—that built WeWork into one of the world’s most valuable startups, with operations spanning 111 cities in 29 countries.

Then, in August, WeWork filed for an initial public offering, and in doing so exposed a raft of curious and troubling details about the inner workings of the company, which rebranded earlier this year as The We Company, or We.

Imagine – someone could have called Adam to order, reminding him that he would meet the village one day!

The Risk-Reward Geography of Africa

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In secondary school, you might have learnt that action and reaction are equal and opposite (at least in the simple world). Extend that to business, you will understand that risks correlate with opportunities, but to be a good value builder, you must minimize those risks within the domains of the opportunities. 

Just after hitting submit button on this piece which ran earlier this morning, I received this press release from Control Risk. Did you see Nigeria? Huge Risk but also massive Reward. That is the state of Africa in general – and if you want to eliminate all the risks, you will never buy a ticket from that Switzerland, Sweden or New York to venture into Nairobi, Lagos or Accra.

In short, do not pray that all the risks are gone. If they disappear, Warren Buffett will find Nigeria attractive. And by the time he pumps in $billions, you could be a spectator in that sector. That does not mean that we should not deal with our obvious bottlenecks, my thesis is this: risks will always be here, either from the paralysis in Nigeria or new species of competitors. If you have a habit of running away from them, you will never take action.

Read the press release below.

 The fourth edition of the Africa Risk-Reward Index from specialist global risk consultancy Control Risks (ControlRisks.com) and independent global advisory firm Oxford Economics (OxfordEconomics.com) has been released today. The report offers a comprehensive and up-to-date view of the highly-dynamic business investment landscape in Africa. The respected index tracks the evolution of the investment landscape in major African markets, and this year’s edition marks several important and intriguing trends that impact investment strategy across the continent.

The benchmark research recognises that elections in African markets can often fuel tensions and raise investment concerns. However, it also demonstrates how elections increasingly serve to stabilise Africa’s evolving political landscape. It is crucial to identify how elections can end prolonged uncertainty, provide legitimacy, and empower existing or new African leaders with the mandates required to push forward with reform or counter-reform agendas.

“Do not get carried away by enthusiastic reform promises by assuming that reform-minded ‘strong-man’ leaders can push their way through free of any constraints,” Barnaby Fletcher, Associate Director Analyst at Control Risks, warns. “The real political lesson of recent years is to not underestimate the strength of counter-reform efforts by existing political structures, as well as the complexity of the undertaking, ” he explains.

African investment has traditionally been dominated by its big economies but the long-awaited emergence of intercontinental trade blocs is shifting the balance of power. The paper explores the huge potential significance of introduction of the African Continental Free Trade Area (AfCFTA) in late May, while raising some concerns about its implementation. It also analyses the significant progress made by regional blocs such as the strengthening East African Community (EAC).

“The current edition of the index shows a slight increase in reward scores for some of the continent’s largest economies, including Nigeria, Angola, and Egypt, as the economic recoveries in these giants gain traction. However, the highest reward potential remains centred in the East Africa region, with expanding services and infrastructure development boosting demand and improving business environments,” says Jacques Nel, Chief Economist Southern & East Africa of Oxford Economics.

The comprehensive paper also tackles common misinterpretations of the external influences affecting African economies. Africa is no longer an even battlefield for US and Chinese players as commonly thought. Current US-Africa totals USD 39bn, while China-Africa represents more than USD 200bn, and EU-Africa trade is now over USD 300bn according to data revealed in the paper. The research also notes a surge of interest in Africa from smaller geopolitical players such as Russia, the Gulf states, Turkey, and India.

“The standard narrative of US-China rivalry in Africa had always looked like an over-simplification, but is certainly outdated now. China’s engagement with Africa is undergoing a fundamental shift, the US is playing catch-up, and a host of other countries are seeking to expand their influence in an increasingly multipolar landscape,” explains Barnaby Fletcher, Associate Director at Control Risks. “Geopolitical objectives are being supported by a flood of development finance, creating both opportunity and competition for private-sector players.”

Africa remains a desirable investment destination with a young and increasingly urban demographic, a wealth of natural resources, and a proven ability to leapfrog technologies in areas such as telecommunications or finance. The growing competition for investment across the continent is helping to promote reform, which in turn encourages greater investment. In Africa, diversification increasingly equals success and economies can no longer rely on merely holding the most mineral resources.

“Especially at a time of a trade war, which threatens to further depress Chinese demand for commodities and global demand for oil and gas, dependence on raw commodities exports is a serious weakness for an economy. It is for this reason that governments are competing to attract investment capital and firms in order to grow their manufacturing and services sectors, to supply goods and services to the many millions of Africans moving to the continent’s cities,” says François Conradie, Head of Africa Research at Oxford Economics.

For the less experienced investor in Africa, the index offers a comparative snapshot of market opportunities and risks across the continent – offering critical information for market entry strategies. For the more seasoned Africa investor, the index provides a grounded, longer-term outlook of key trends shaping the investment landscape in major African economies. The Africa Risk-Reward Index goes beyond the headline-grabbing news and noise surrounding the topic to provide an informed view on investment into Africa.

What Motivates Me On Nigeria

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Across sectors and regions in Nigeria, let me remind you that we are still at infancy in nearly all of them. In other words, the opportunities are still there in our largely inventive societies. From my simple calculation, the capability parity value, after considering the resources in the nation, points to a GDP of at least $3 trillion. But we are less than $500 billion right now. You know the implication? Every value and opportunity can be multiplied by a factor of 6. That is how I see our nation – and that motivates me.

The best companies for Nigeria have not been started. If you look at Dangote Group and you think it is big, just note that it remains a company within a $500 billion economy. There are opportunity-moments for $2.5 trillion space available. If you look at banking and you think we have max’d all opportunities, I will remind you that Nigeria’s largest bank by market cap, GTBank, at less than $3 billion, is a huge testament that our banking sector is still at infancy. The big buildings should not fool you – the Nigerian banking sector has not reached up to 10% of its natural value even though First Bank may have clocked a century! Yes, in those years, no one has pioneered a credit system which is a legal money multiplier in an economy.

Why must you have 100% of cash before you can buy a car, build a house, go on vacation, send kids to school? Nigerian banks have not received the memos. Sure, no credit system is in place for them to build – and you cannot blame the banks; banking remains the most innovative sector nonetheless. But the fact that the credit system has not been done makes my point: opportunities abound ahead and the future is one of abundance.

We have no electricity, we have no roads, and we have an educational system that needs redesigns. If less than 8% of measurable adults in Yobe state can read and write, it means in Yobe state alone, there is a huge market on education. More than 37% of farm produce are wasted yearly, reminding everyone that preserving the little we produce could have real impacts on our agriculture sector and the wellbeing of our citizens. In aviation, the airports are so few that you wonder what we have been doing for decades. Yes, you fly from Lagos to Owerri, and you have to drive five hours to get to Ohafia. You fly from Abuja to Lagos, and you have to drive hours to northern Ekiti state.

Simply, Nigeria is an opportunity because we have not even started. Do not allow any human being to confuse you: every market opportunity in Nigeria is a fair game to compete right in and win. We are still at infancy and the best companies in this nation have not been started. Yes, tons of free range chicken opportunities that can come with no disruption.

Yet, it is not always necessary for a company to disrupt for it to grow. To explain that disruption is not always required for growth, I will use free-range chickens, found in most African villages, to create an analogy. A free-range chicken “is a bird that is allowed constant access to the outdoors, with plenty of fresh vegetation, sunshine and room to exercise”. As a teenager, I grew some and it was a very good business.

[..]

I want us to consider the need of creating new markets in Africa even when we are not disrupting any firm or sector. It is not always that one has to disrupt, but it is mandatory that one has to create, in order to find growth. My free-range chicken blossomed by finding its own paths and at the same time did not participate in any competition for my time. It used its creativity to survive and grow without disrupting (yes, disturbing) any person.

In the past, I have listed the business opportunities in this nation – they remain.

All The Business Opportunities In Nigeria

 

Reasons Why People Easily Settle For Less

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This may not go down so well with some people, but it is the truth – Nigerians settle for less. They do this because they have programmed themselves to suffer. In fact, Nigerians enjoy suffering. In Nigeria, you can hear people bragging about how they suffer most. You can hear statements like, “See this one that’s ‘making mouth’ about how he suffered as if he can compare his own to mine”, as if there’s an award for suffering.

I know readers will be fast to judge that things are not easy in the country. I am not against that, but we shouldn’t use it as excuse to settle for less. Honestly, Nigerians make it look as if someone has to suffer first before being successful. This is why someone whose father paved way for is looked down on because he didn’t ‘suffer’.

I once told someone that what most people do these days is struggling, and not hustling. The person didn’t understand me because to him, struggling and hustling are one and same thing. Anyway, let me clear the air a little bit. When you hustle or struggle, you get to leave your comfort zone which will make you uncomfortable for sometime. But then, if you are smart, you’ll find a way to control and manipulate your environment to give you what you want – this is hustling. But when you allow the environment to control and manipulate you and keep you where it likes, you are struggling (and that’s when suffering sets in). So in summary, a hustler uses his brain while a struggler uses just his body (lol).

Ok, let’s get back to where we were. The ‘you-need-to-suffer-to-make-it’ syndrome is affecting a lot of things in this country. To be honest, I believe things are the way they are in this country because of our mindset. Because we believe nothing good must come easy we swallow up a lot of trash dished out to us.

Ok, let me point out some ways this affects us:

a. Most Nigerians are uncomfortable with embracing modern day technology because they don’t want to be called lazy. Ok, let me ask. How many of us have vacuum cleaners in our houses? Don’t worry, I haven’t even seen it (lol). What about other home appliances like dish washers, rice cookers, foo-foo pounders and the rest? Ok, coming to our offices, how many offices are conducive for people to stay and be productive to their maximum point? What about office equipment and machines that could make works easier and more efficient? Of course if you complain, your colleagues will tell you to ‘manage’ because this is ‘Naija’, where ‘things are hard’. And if your boss hears it, he will tell you to either make do with what you have or procure them with your salary.

b. Our public office holders actually treat us the way they do because they know we will just sigh and decide to ‘manage’. They know Nigerians easily adapt to difficult situations and whatever is dished out to them won’t really bother them. Honestly, if we haven’t embraced suffering the way we do, there is no way we will be plying bad roads that break our bones and send us to hospitals. It’s because of our mindset that a lot of communities in the country do not have portable water, which has been provided for. What about civil servants that have not been paid for months at a stretch? Of course they will survive; they have been surviving since so what’s the difference? Our ‘suffering’ mindset is denying us good governance; we need to do something about that.

c. Our utility companies misbehave as well. It is because of the way we see life that ‘NEPA’ will give us power for only 8 hours and we will say, “they have tried o. If they are giving it to us like this everyday we won’t be complaining” (as if we don’t pay them). And because we have decided to settle for less, these people are not planning to improve.

d. Our education system is also witnessing this suffering syndrome. I always say that the coming of private schools to Nigeria has changed the outlook of Nigerian education system (though a lot of works still need to be done). Those of us that went to public schools do not cherish going to school, especially in our primary schools. We always look for reasons why we should skip classes, all because of the hardship experienced at school. But today, children look forward to going to school (especially private primary and nursery school children) because they go there to study and play in good environment that has all the necessary facilities. As for our public schools, well, a look at their students while going to school will tell you where they will rather be.

e. A lot of Nigerians are unemployed or underemployed right now because they believe they must suffer first before ‘making it’. So they look at themselves as passing through the ‘suffering’ stage, which will usher in the ‘success’ stage. I don’t know how this ideology came into our country because it is not in our culture. Yes, what our culture preaches is diligence and hard work. In fact, in Igbo tradition, when people suffer, it is seen as temptation, ill luck or repercussion. Our tradition doesn’t preach that you suffer first before you land your dream job. So, if you know someone that tied himself down with this mindset, kindly let him know that he can aim higher and achieve.

f. We don’t direct the career path of our young ones because we believe that when they grow up they ‘will suffer like every other person’ until they find their footing. But then, what about those that continue to suffer without finding their footings? Shouldn’t we have helped them at the right time? Must we allow them to pass through the same pain we experienced because we believe that’s the only way they will be ‘wise’?

A lot of people have developed this ideology that they must suffer before they find their right path. If you ask me, I will say that it was passed onto them by their parents. So we have been passing on this suffering syndrome unto the next generation and that means that the old story will continue.

We need to understand that there is nothing wrong with coming out of school and landing your dream job, or going into the career you have passion for. Let’s stop preaching about ‘suffering’ and ‘struggling’ and start preaching about ‘fun’ and ‘hustling’