African Business 2020 edition

PROFILE Region: West

PROFILE Region: West Africa The United Nations population estimate for West Africa is 381-million (2018). crops are groundnuts, sorghum and millet. Further south is the Sub-Humid Zone which includes Guinea-Bissau, Benin and the central parts of Nigeria where grass and shrubland predominate. The Humid Zone comprises the Guinea Zone (annual rainfall up to 1 800mm) and the Forest Zone. Both areas have tsetse fly, so livestock are less common. Multiple crops are cultivated and when dense tropical forests are cleared in the south, the land can carry oil palms, coconuts, rubber and cocoa (FAO). Economy The member states of the Economic Community of West African States (ECOWAS) are Benin, Burkina Faso, Cape Verde, Ivory Coast, the Gambia, Ghana, Guinea, Guinea Bissau, Liberia, Mali, Niger, Nigeria, Senegal, Sierra Leone and Togo. The languages in which ECOWAS conducts its business reflect the varied colonial history of the region: French, English and Portuguese. The main body of ECOWAS is the Authority of Heads of States and Government. Other institutions include the Council of Ministers, the Commission and the ECOWAS Bank for Investment and Development (EBID). The peacekeeping force of ECOWAS has deployed joint military forces in times of instability, most recently in the Gambia. Climate The region’s climate varies from very dry in the north to humid in the south. In the Sahelian Zone the dry season can extend to 10 months and cattle, sheep and goats graze on grassland. Cotton is the main cash crop and food The Nigerian economy contributes about 70% of regional GDP, so when that large oil producer experiences a recession, growth figures for the region are disproportionally affected. Low oil prices led to such a recession in 2016. After several good years of growth, average GDP growth in West Africa was down to just 0.5% in 2016. In 2017 it recovered to 2.5% and three of the six African countries in the World Bank’s top 10 in terms of growth predictions in 2018 were in West Africa: Ghana (8.3%), Ivory Coast (7.2%) and Senegal (6.9%). Nigeria has also done better with improved commodity prices and the completion of successful presidential elections in 2019. The African Development Bank’s West Africa Economic Outlook 2018 notes that most of the region’s economies are dominated by the service sector and that manufacturing is the smallest contributor to GDP in all of them. AfDB predicts that gross capital formation will grow quickly as the region moves away from reliance on demand from private consumption (70%). Several of the region’s economies are dependent on single commodities which makes them vulnerable to price shocks. More than one country is looking to join the existing producers of oil and gas, but the creation of stronger manufacturing bases is the key to more stable economies and more formal jobs. Resources Oil, gold, phosphate, iron ore, bauxite, diamonds. AFRICAN BUSINESS 2020 74

PROFILE Nigeria Africa’s most populous state is also rich in resources. Capital: Abuja Other towns/cities: Lagos, Port Harcourt, Ibadan, Kano, Benin City, Jos, Ilorin Population: 203.4-million GDP: 7-billion (2018) GDP per capita (PPP): 990 (2018) Currency: Naira Regional Economic Communities: Economic Community of West African States (ECOWAS), Community of Sahel-Saharan States (CEN-SAD) Landmass: 910 768km² Coastline: 853km Resources: Natural gas, petroleum, tin, iron ore, coal, limestone, niobium, lead, zinc. Main economic sectors: Services, agriculture, industry, crude oil. Other sectors: Fertiliser, food products, chemicals, ceramics, rubber, textiles, wood, hides and skins. New sectors for investment: Agri-processing is boosted by processing zones for staple crops. Services sector is growing fast and mining, quarrying and manufacturing are showing promise (African Development Bank). Key projects: Economic Recovery and Growth Plan (industrialisation), Power Sector Reform Programme. Secured Transactions in Movable Assets Act 2017 has stimulated lending to small, medium and microenterprises (SMMEs). Chief exports: Petroleum and petroleum products, cocoa, rubber. Top export destinations: India, US, Spain, China, France. Top import sources: China, Belgium, US, South Korea, UK. Main imports: Machinery, chemicals, transport equipment, manufactured goods, food. Infrastructure: 40 paved airports; railways 3 798km (2014); highways 195 000km, of which 60 000km paved (2017); waterways 8 600km (Niger and Benue Rivers and other waterways); pipelines for oil, refined products, gas, LPG and condensate; seaports at Calabar, Lagos and Bonny Inshore Terminal; LNG export terminal, Bonny Island. ICT: Internet percent of population: 25.7% (2016). Mobile subscriptions per 100 inhabitants: 76 (2017). Ranked 143 in world, ICT Development Index 2017 (ITU). Climate: Coastal areas experience equatorial conditions and mountainous south-east is cooler. Central plateau is tropical while northern areas are dry and arid. Religion: Muslim about 51%, Christian about 47%. Modern history: Africa’s most populous country comprises more than 250 ethnic groups. Nigeria is a federal state with 36 states and one territory (to govern the capital city). The 2007 elections were the first where a civilian government handed over to a civilian government. In 2015, Muhammadu Buhari won as an opposition candidate, another electoral first for Nigeria. Buhari, who himself had previously led the country as a major-general, also won the 2019 election. Depressed oil prices have constrained economic growth, but there are plans to improve electricity generation and to diversify the economy. Security concerns include religious clashes in the central districts, attacks by Boko Haram in the northeast and activists campaigning for a greater share of oil revenues. Despite these challenges, Nigeria accounts for about 70% of regional GDP. 75 WESTERN AFRICAN CAPE BUSINESS 2020