Supply Management goes globe trotting to evaluate the procurement potential of countries around the world…
AREA 923,768 km²
THE HELICOPTER VIEW As well as an abundance of natural resources, Nigeria has one of the largest, and most youthful populations in the world. But as Africa’s largest oil exporter it has been hit by plunging oil prices.
ECONOMIC OUTLOOK Nigeria is currently in a recession. When oil prices collapsed its economy went from growing 6.3% in 2014 to contracting 1.5% in 2016. The World Bank thinks the worst is over, and predicts a return to growth next year, albeit only by 1%.
BIGGEST FOREIGN INVESTORS Last year Chinese companies invested around $1.79bn in Nigeria. Main investors include China National Offshore Oil Corporation and China Railway Construction Corporation.
SUPPLY CHAIN ISSUES The country has just completed its first standard gauge railway, and the government pledged to spend 30% of next year’s budget on infrastructure. Shipping giant DP World is also reportedly in talks to invest $1bn in Lagos’ port.
STRENGTHS Nigeria’s strengths are also its weaknesses – natural resources that its economy is dependent on, and a young population restless with economic inactivity.
CHALLENGES There are still serious security challenges across Nigeria, including Boko Haram in the northeast and insurgency in the oil-rich Delta region. Poverty, joblessness and climate change are among the causes. Corruption, poor infrastructure, an inefficient judiciary and unreliable dispute settlement systems also hamper business.
BOTTOM LINE Despite its problems, Nigeria is Africa’s largest economy. It is geographically well positioned and the government has plans to get the economy back in shape. But falling oil prices mean the road to recovery is long.