I was in Brussels recently on a panel organized by the Konrad Adenauer Stiftung. Here are a few things I learned about the Nigerian economy:
Young people, not oil, are Nigeria´s main resource
It is a common misperception that Nigeria is an “oil economy”. In fact, oil accounts for less than 10% of GDP directly. Services and agriculture are the largest sectors. Nigeria is Africa´s largest economy, and my colleagues always come back from Lagos excited about the potential of the projects they see, across diverse sectors, to promote employment and inclusive growth.
Most of this enthusiasm is down to Nigeria´s biggest resource – its large, youthful and dynamic population. Challenges in the education system need to be addressed urgently, of course— between 8 and 10 million primary-aged Nigerians may be out of school. But Nigeria is also home to millions of highly skilled people. In addition, overseas Nigerians could be tempted back from high-flying careers abroad by the right opportunities. Some sources claim that 17 million Nigerians live abroad, while the UN estimates the size of the diaspora at over 1.2 million. The OECD estimates that 35% of Nigeria’s emigrants are highly skilled.
How can you make a small fortune in Nigeria? Start with a big one!
A colleague shared this joke when he heard I was making a presentation. Many people have unfair perceptions about Nigeria. In reality, many people have made a lot of money there – the most recent Forbes List contains four Nigerian billionaires, including Africa’s richest man, Aliko Dangote.
But investors cannot afford to be naïve about the risks. The underlying challenges include inadequate infrastructure, particularly the power supply; corruption; policy and political instability; macro volatility; and highly complex societal divisions across geographic, cultural and ethnic lines.
Nigeria’s economy needs youth disruptors, not damsels in distress
The complex challenges facing Nigeria can seem overwhelming, but the strong underlying resources also give grounds for optimism. If one could reset the system and change the expectations, there are high chances of the massive take-off we are all waiting for.
What will provide that disruptive impulse?
Technology will be part of the story, but much of the impetus will have to come from Nigeria´s youth. Young people need to take leadership roles, turn things on their heads, and demand more and better opportunities. As Nkemdilim Begho, a female entrepreneur in Nigeria, put it, women and young people cannot hang back and wait for help “like a damsel in distress”. They need to get out there and seize the chance for themselves. In doing so, they will be the ones to drive change.
“It is time for leaders and youth to shape the Africa they want, together”, said another young participant at the event in her blog.