The story is told of when in the early 2000s, Vodafone, then the world’s largest telecoms company, commissioned one of the top five global consulting firms to do a report on the viability of coming into the Nigerian market to provide its services. The firm reported back to Vodafone, declaring magisterially – as they are wont to – that the entire market size for phones in Nigeria could not exceed five million mobile phones. The people were so poor, disorganised, and hungry, they opined. And so, Vodafone decided that Nigeria was ‘bad market’. This is reminiscent about two shoe salesmen who left England for India in the early days of colonisation. One declared back to his bosses that there was no market, as people wore no shoes. The other was ecstatic as all he could see were millions of potential clients. But I digress.
It took MTN, a company from South Africa, and Econet from Zimbabwe, followed by Globacom – a Nigerian company – to discover what a gem Nigeria was. A diamond in the rough. Since MTN especially moved into Nigeria, it has generated most of its turnover and profit from this country – out of the 16 countries in Africa and the Middle East where it operates. Averagely 30 per cent of its global turnover comes from Nigeria, ditto its profitability. For 2025, the company declared a profit after tax of ₦750 billion, on the back of a turnover of ₦3.94 trillion or $2.63 billion! The company projects at least a ₦5 trillion turnover in Nigeria for the year 2025. Its customer base surpasses 84 million Nigerians, from the total of 174 million mobile lines in Nigeria. Talk about a country where people are so poor and hungry and dying in droves as a result of poverty! Imagine the gap between five million and 174 million. We have to reinterrogate these narratives that serve the objectives of some fifth columnist. All I am interested in is the truth…that elusive truth. If this company has made its best profits in Nigeria for over 25 years now, consistently, and its products are still affordable by many, this data looks like a good proxy, and I wager that many of these pundits seem not to have the tools to determine the economy of this country.
I am writing this article on the back of PriceWaterHouse Cooper’s (PwC)’s recent report where they project another 10 million people to drop into poverty in Nigeria in the year 2026. That is in spite of an economic growth rate powering ahead of projections, several interventions like the student loan and stipends, falling food prices and inflation in general, strengthening naira, a growing social capital system powered by telecommunications and improvements in payment systems (whereby millions of poor people reach out daily to their benefactors and thereby reduce incidences of poverty and hunger), improving trade balances and balance of payment surpluses, and even empirical documentaries in rural areas where farmers are having much better financial situations. I think many Nigerians who have platforms to vent their opinions are stuck in a negative mode; where their immediate instinct is that life cannot get better for Nigerians.
Mine is to try and prise into the realities of Nigerians, beyond engaging with preset models used by some of these powerful bodies. We saw how such models misled the world into a Global Recession between 2008-2011. Ratings agencies whom the financial markets swore by tumbled over. The smartest banks bet wrongly because that was what the algorithm recommended. Consulting firms followed in tow. What these smart guys didn’t do was actually get the human side of the story. They didn’t bother to understand human nature. They burnt their fingers.
I will come back to that aspect momentarily, but it is pertinent to state that I am not basing my position – that Nigeria may not be defined by the narrative of incurable poverty and want – on the MTN story alone. I recently chatted with a friend who runs an investment arm of a bank. You know there are now these many spin-offs in the financial sector, and you wonder how they are thriving. They call it the HoldCo system. So, the Holdco supervises everything from the ivory tower, then there is a bank, and under the Holdco, there are investment companies, asset management companies, stockbroking firms, insurance firms, Fintechs and what have you. So, I asked her whether the business was thriving. She answered in the affirmative but also said that there are so many investment companies lately, and that all are making money. Many are even standalones! Nigerian financial institutions are the only ones trying to colonise Africa!
Now, these businesses thrive because they get monies from Nigerians for investment in different financial structures. It could be in the money or capital market. It could be in other arrangements. But the bottom line is that they are thriving. So, where are these endless monies coming out from? Let nobody be deceived, there is money in Nigeria. Maybe what we have is an income inequality problem. Still, it is more complicated than that and we will see this shortly.
Then Nigeria also features as the second biggest country in the world when it comes to Cryptocurrency transactions. Trust Nigerians to be there anywhere money can be kept secret. Maybe our problem is our appetite for wealth. As I type, the case of a former minister currently being prosecuted comes to mind. As the list of his acquisitions were reeled out I wondered whether any man needed that much. But that is whom we are. Since cryptocurrency offers a level of secrecy, Nigerians happily stash money there while we all complain about scarcity.
Then we can look at this subject from a behavioralism angle. Nigeria is the largest African country by population. Africa is the last frontier where we have the youngest countries in the world. This means that we are largely more experimental and evolving in government than many other countries elsewhere. This means that many countries in Africa are yet to understand how the world works, how the global hegemons want the world to work, and how to navigate the incredibly tough global financial environment. In fact, many countries in Africa, especially Nigeria and Nigerians, just choose to ignore how things are supposed to work, and we go around trying to impose our own idiosyncrasies on the rest of the world.
So, Nigeria is where we fundamentally want to have endless cash to spend on things that catch our fancy. It is there in our tradition, in our music, and our religion. Our God is supposed to supply every of our needs, with us making the least efforts. We don’t have that sense of scarcity that they have in western countries. I have thus met many Nigerians who believe that once one is born in a country, that country should step up and take care of their citizens. I recently took the Blue Line Metro in Lagos from Marina to Mile 2 to see some of my folks. A few people could have recognised me and wondered what this ‘big man’ is doing inside the Metro. Train services have been abandoned to the poor in Nigeria. Hardly do so-called middle-class Nigerians get into those trains, even for experimental reasons. I ride Bolt/InDrive in Lagos and elsewhere. Being in government appointment does not have to translate to being chauffeured everywhere in government vehicles. Elsewhere, these things are normal. But there is a Nigerian mentality deeply ingrained. Even those complaining today are merely waiting for their own opportunity to largesse and display. But that is not my most important observation from using the metro recently. My main observation was the very ceremonially slow manner Nigerians walked out of the train and down the stairs. Unlike elsewhere, Nigerians are not in a hurry. There is no sense of urgency. A Briton or American will find it odd. Nigerians walk like they are brides and grooms going for ceremonies.
From my background, I see things differently. I believe that it is left to you to make whatever you wish of yourself. I am not used to loitering government offices looking for governmental favours. With this kind of mentality, a Nigeria who makes good fortune, rather than consolidate on their exalted position, simply changes gear and asks for the next big thing. Imagine building your own house from the scratch up to roofing, painting and stocking with accessories. This is a fantabulous achievement that most people in the countries that sit atop the wealth scale cannot even imagine. Imagine buying a car with cash. Out there even your phone, television, and clothes are bought on credit. So, what is known as achievement here is different from what is known as achievement there. What about our spending on ceremonies; birthdays, weddings, burials and so on? It’s just mind-blowing. The way we waste food and drinks in those occasions!
Imagine our behaviours around entertainment. Most ‘middle class’ people in Nigeria spent untold amounts in lounges, clubs, with musicians, ‘spraying money’, buying expensive drinks and whatnot. Especially the men. That is why more and more, women are becoming wealthier than men – not only in Nigeria but everywhere, because they keep wealth more. What about spending in religious cycles. Many believers are not content with the usual ‘tithes and offerings’, but many build houses for their religion, or do something crazy! Their shepherds are there to encourage them and to sometimes take inordinate amounts from these adherents, leading to a situation where many religious leaders have become embarrassingly cocky and corrupt. Free money in the name of the lord. On the flip side, religious adherents in Nigeria have become addicted to the annual pilgrimage which could be quite expensive. There is now a competition – perhaps it is an indicator of your financial health. I was on TV recently discussing a similar subject and it occurred to me that the number of latest Rolls Royce cars may be more in Nigeria than in the UK where they are produced. I just did a search on AI now and it told me that Nigeria had more Rolls Royce Cars than any other country in Africa with the market share having doubled in the last two to three years! The same story goes for private jets, and why Aliko Dangote – the world’s richest black man – appealed to billionaires like him to put money in industries than these fancy acquisitions lately.
An Inequality Problem?
Maybe what Nigeria has is an inequality problem then; a scenario where a few hundred thousand people have so much but the wealth is not trickling down as promised by economic orthodoxy. But even that argument is flawed for some reasons:
- There are many opportunities where poor Nigerians get lifted lately. Online, many rich Nigerians do what they call ‘giveaways’, with thousands of Nigerians supplying account details.
- The advent of fintechs with easy-to-open accounts, and improvements in telecoms and payment systems means that a student can be broke in school, wake up and text 20 uncles, and two of them may just send tokens. We all receive dozens of distress messages daily, and we often attend to a number of them.
- Perhaps the problem is that people have become insatiable. Indeed, the fact that many receive gifts does not mean they are really grateful to the donor. Acts of kindness – which is one thing that distinguishes Africans from Europeans – has always been with us but is it solving problems in the long term? Some people have also become addicted to these freebies such that they no longer have the desire to seek jobs, or they believe some jobs are beneath them. This is always a problem. Abroad where government sends free money to the unemployed, they have found that many no longer want to work.
- Evidently, Nigeria’s informal economy is where the concern is. And this is to be expected. Nigeria may have the largest proportionate informal sector as a percentage of the national economy, in the world. Places like India still have this problem, but several actions over the years – including the demonetisation started in 2016 has reduced the informality of that economy even though it was fought tooth and nail and unfortunately demonised by global press and some top economists.
- If the problem is pinned down to inequality of income, then the ongoing tax reforms is very timely towards redistributing income or at least generating more revenue for government from among the well-to-do, in order to create large public spending and to build infrastructure. The ongoing attempts to scuttle the reforms which has already gone into action are therefore suspect. Tax compliance is somewhere between 10 per cent and 20 per cent in Nigeria. Only government organisations and some private sector entities comply. Many organisations deduct tax from staff or even VAT from customers, and they refuse to remit. Company income tax manipulation is the order of the day and only companies wishing to obtain government contract bother to remit whatever it is they concoct with their auditors. This means that tax and revenue collections can quadruple easily in our country with these new reforms.
Somehow, Nigeria must change for the better and the time is now.
‘Tope Fasua is the special adviser to the President on Economic Matters.
