When in 2004 President Olusegun Obasanjo muted the idea of a state- backed Nigerian company that can compete favourably with multinational companies, Nigerians partially bought into the idea.
This led to the setting up of Transnational Company of Nigeria otherwise called Transcorp.
It was meant to be private sector-driven but has the stamp and backing of the state.
As soon as the company started, insinuations and condemnation trailed its take off and not too long after, what was a noble idea fizzled out. The dream was stillborn.
Japan, unlike Nigeria, when it started its post-war economic reconstruction, put in place appropriate economic policies to support the development of the private sector.
Over the years, it was the dynamism of the Japanese private sector that saw a country without natural endowment emerging in the late 70s as world economic power house.
Looking at the example of the economy of South Korea, it is the same dynamism of private sector companies that has brought the country to its present status as one of the Asian tigers.
You can easily count the companies making wave in South Korea — Kia Motors, Daewoo, LG Electronics, Hyundai etc.
Nigeria today prides itself as the leading economy in Africa by gross domestic product measure. That is all there is to it.
The question to ask is who are those making it happen in the Africa continent? How many Nigeria-owned companies of note are global players in Africa’s economic scenario?
The fact on ground has reduced the Nigeria euphoria to mere cheap talk, fantasy and day-dreaming. Apart from Dangote Cement, perhaps UBA, Zenith, GTbank and few others which have presence in some African countries, though not in South Africa and North Africa there is no visible presence of Nigerian businesses elsewhere.
But South Africa which Nigeria with fanfare celebrated it took over from as the leading economy in Africa, is everywhere in Nigeria and other African countries.
A global bank ranking by The Banker in 2014 has shown that South Africa dominates banking industry by assets in Africa.
The assets of Standard Bank alone is more than that of the five leading banks in Nigeria despite the 2004 banking consolidation. Financial industry report also showed that ETI is the largest bank in Africa by spread and majority of its staff are Nigerians.
Indications are that South Africa’s fourthlargest bank, Nedbank will by the end of 2014 own 20 per centof ETI. Simply put, a South African bank will be the largest bank in Africa by assets and one of its other bank is about to own 20 per cent of Africa’s largest bank by spread.
Funny enough, ETI is not even headquartered in Nigeria but is depending on Nigeria to drive its earnings. So who is the leader? Nigerians should please think and answer the simple question.
Another South African bank, Standard Bank, bought over IBTCChartered Bank which, for purpose of identity, is called StanbicIBTC. This Nigerian arm of the South Africa bank is the largest equity trader by value in Nigeria, largest portfolio manager and is represented on the council of the Nigerian Stock Exchange.
It has also been selected as the sole broker for the Federal Government of Nigeria and was picked by the government to be the settlement bank for the electronic warehouse receipt system introduced by the Nigerian Commodity Exchange.
Its founder and board chairman of the Nigerian arm of Standard Bank, Mr. Atedo Peterside is on Nigeria’s Economic Management Team.
The poser to this government is: which Nigerian bank has made any inroads worth mentioning into South Africa? How many Nigerian corporate entities are operating in South Africa profitably? No thanks to haphazard economic policies of government.
According to Jude Fejokwu, Principal Analyst, Thaddeus Africa Research, Templeton has its African investments office in South Africa but its emerging market star manager is more excited about Nigeria than South Africa.
Renaissance Asset Management, he disclosed, has a pure Nigerianfund and so does Sustainable Capital. Both companies run the funds out of South Africa. It is now obvious MTN Nigeria generated 37 per centof total revenue for the MTN Group worldwide as at first half of 2014.
The Nigerian arm’s revenue was 41.5 per centhigher than that of the home country, South Africa. The Nigerian arm increased revenue by 21.5 per cent while the South African arm had a decline in revenue of 7 per cent. MTN has been in Nigeria for 13 years and Nigeria contributes more than a third of the revenue for the whole MTN Group worldwide.
Meanwhile, MTN Nigeria is not listed here, where it rides the wave of profitability and repatriates the funds back home.
DSTV will be no different from MTN in terms of where majority of its revenue comes from. It increases its subscription fees every 15 months on average.
It is also not listed in Nigeria. China’s National Development amp Reform Commission handles issues of pricing in China in conjunction with two others.
The organisation recently forced automakers like Mercedes to reduce their prices which the Chinese said were selling in excess of their home markets.
The same thing that the Chinese authorities kicked against is happening here in Nigeria, Africa’s most populous nation and no one is talking of doing anything about it.
The people who are in position to do something about this are busy discussing how to embezzle more money to afford these exorbitant prices instead of protecting the populace.
Tiger Brands, a South African company has bought a majority stake in UAC Foods and Dangote Flour in its quest to drive earnings which have stagnated in its home country. Shoprite, another South African firm is working on its 10th shop in Nigeria presently.
It does not disclose its profit margins and is listed in its home country and not in Nigeria where it is making a lot more money than it envisaged and continues to have increases in headline earnings.
I cannot but agree with Jude Fajokwu, Principal analyst Thaddeus Africa Research that Nigeria may be the largest economy overnight but it is definitely not seen as the wife of African financial services industry.
It remains a bachelorette that no one is interested in marrying because they are getting so much milk and honey piewithout commitment, so why proceed further.
Source : Vanguard