The nature of the current crisis is not new for Nigeria. It has been caught out before by crashing oil prices, writes DIANNA GAMES
Published in Finweek, 12 March 2015
Nigeria’s finance minister Ngozi Okonjo-Iweala has tried to put a brave face on the multiple challenges that Africa’s biggest economy now faces in the wake of a plunge in the price of crude oil – the source of 80% of the nation’s revenues.
Late last year, when the damage became apparent, she told the nation not to panic. “Panic is not a strategy. We are managing the situation to keep the economy on a stable sustainable course and we will not listen to those who want us to throw up our hands in despair and give up.” But the indomitable Okonjo-Iweala is shouldering the burden of trying to make ends meet with rapidly dwindling funds.
A degraded new normal happens over time, incident by incident, until you forget what you have lost, writes DIANNA GAMES
Published in Business Day Sa, 16 February 2015
THE destruction of value in a country is seldom a single event. It is a slow erosion, an incremental shift in perceptions and expectations, year by year, incident by incident, until one day what has been destroyed is largely forgotten and there is a new normal. People no longer complain or protest about what they have lost because they have found a way to adapt to a degraded situation.
An example of this is easily found in the power sector in Africa.
On a trip to Lagos in Nigeria many years ago I couldn’t help but notice the thumping sound of generators around every corner. SA’s lights were on 24 hours a day, barring calamities like lightning strikes, and back-up generators were a novelty.
I commented frequently on this striking contrast between the two great economies of Africa.
It wasn’t always like this, a Nigerian friend said. In the 1960s the Lagos grid functioned properly. But decades of underinvestment in the power sector by successive governments with other priorities had brought Nigeria to a situation where installed capacity of just 4,000MW was all that was available to serve a country of 160-million people.
Political expediency is what drives the government of Zimbabwe, not the economy, not the interests of investors and certainly not the interests of its citizens, writes DIANNA GAMES
Published in Business Day SA, 5 January 2015
AS 2000 dawned I was at an event where the subject of Zimbabwe came up. Many people in the discussion were adamant that President Robert Mugabe would be out of power within a few years. Then, they said, Zimbabwe would re-emerge as an economic power — Mugabe’s removal was seen as a necessary condition for economic revival.
At the time the economy was in trouble. Zimbabwe’s currency had plunged as a result of huge unbudgeted payouts to war veterans and it was burning money it did not have to prop up the president in the war in the Democratic Republic of Congo.
The year 2000 was seen as a watershed year. For the first time since 1980 the population voted against a Zanu (PF) plan — the new constitution — in a referendum at about the same time that a new political opposition emerged, which nearly won the election that year.
It seemed just possible then that Mugabe was on shaky ground.
Nigeria is Africa's most populous country with 150-million plus people. With an economy growing at an annual 7%, the country is one of the continent's hottest investment destinations. This week we unpack some of the investment challenges and opportunities that this West African powerhouse faces. Joining ABN's Godfrey Mutizwa in-studio to give their views on Nigeria as a business & investment destination is: Dianna Games, CEO of Africa at Work; Joel Chimhanda, Principal at JC Capital; Suresh Chaytoo, Sector Director of Banks and DFIs for Africa and Latin America at RMB.