It was Black Friday in Lagos. Hordes of shoppers trooped into the Apapa Mall to buy cheap, over-the-counter products. Shoprite was not the only store offering discounts but it was indeed the most physically visited. Shoppers ignored cash crunch in the economy and traffic logjam that dogged Apapa to move in and out of the retail store, looking carefully at prices to ascertain which attracted higher cuts.
Deep-pocket shoppers gave the cashiers a tough time. Shoppers with fewer items were made to stand for longer than usual to make payment. Shoprite did not disappoint. Staff bakers, as usual, were closer to their ovens than ever before. Managers of different sections were in and out of their offices to be sure that no customer was maltreated or un-served. This was not the first time Shoprite in Apapa was having a sizeable number of shoppers. They had had at least a Black Friday before. So by dint of experience, the retailer did not disappoint expectant buyers.
There were, as usual, many shoppers waiting for freshly-baked bread. “Shoprite is making a lot of money from Nigeria,” said a dark-complexioned young man, who could be in his early thirties, while waiting to buy three loaves of bread for his family. “Yes, their prices are reasonable and you can get all you need here. This is why people come here often,” another responded. “I don’t know why Nigerian billionaires failed to see an opportunity like this before Shoprite,” said a fair-complexioned man who stood nearby. Shoppers patiently waited for 43 minutes before a new set of bread loaves was brought to the counter. Those who needed three or four loaves were given one or two as pushing to grab bread meals turned into shoving.
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“I hardly buy bread elsewhere,” said one of the shoppers who moved from one counter to another in search of discounted products. Shoprite is an example of how the Nigerian market is creating growth opportunities for South African businesses. It is also a typical case of how South African entrepreneurs are meeting the needs of Nigeria’s spot and dynamic buyers. Like Shoprite in the retail sector, MTN, another South African business, has dominated Nigeria’s telecoms industry with over 60 million subscribers. MTN Nigeria reported N870 billion (R31.97 billion) revenue for the period ended June 2017, representing a 10.8 per cent increase from the N786 billion recorded in the same period of 2016.
MTN made this huge revenue despite heavy fines paid by the telecoms firm last year over violations of the Nigerian Communications Commission (NCC)’s directive on subscriber registration. Amid complaints around rates, Multichoice’s DSTV and GOtv are still the favourites of most Nigerians. Nigeria is the biggest market for the pay-TV, accounting for 40 per cent of its 11 million subscribers on the continent. South African firms are bullish about the opportunity provided by the Nigerian economy with 186 million population and young demography. For instance, as xenophobic attacks in South Africa raged on this year, Pepkor, a South African clothing retailer, announced plans to double its presence in Nigeria with 10 store openings per year through 2018.
Similarly, Resilient, one of South Africa’s largest owners of platteland malls, entered into a joint venture with Whitey Basson’s Shoprite to build 10 shopping centres in Nigeria in a deal worth over $85 million. The deal also involved two other South Africa’s big finance and investment organisations, Standard Bank and Group Five. South African firms such as Truworths and Clover left Nigeria in 2016 but not because of social hostility but President Muhammadu Buhari’s tight grip on the foreign exchange market. As South Africans find huge opportunities in Nigeria, Nigerians in Nelson Mandela’s country are also tapping into opportunities there. Emmanuel Okeke, who runs a supermarket at Nugget Street near Royal Park Hotel in Johannesburg, told BDSunday that he is making more money in South Africa than when he was in Nigeria.
When asked whether he has a plan to return to Nigeria permanently, he said he is already settled down there, with his business expanding to Pretoria North. Chikaodili Nwanedo, chairman of Nigeria Union, North West Province of South Africa, said Nigerians own over 30 thriving business outlets in Rustenburg located in the province. “Nigerians in the province are doing well. In Rustenburg, we have more than 30 thriving businesses in different sectors which have employed a lot of people,” Nwanedo said. “Some other Nigerians are also in the universities, government-owned hospitals and providing diverse services to the mines. Nigerians are selling cars and food, while some are engaged in upholstery making, car repairs and barbing, among other vocations,” he said.
No big business like Shoprite
Despite sprawling businesses set up by Nigerians in South Africa, BDSunday found that there was no big Nigerian business in the country. Unlike in Nigeria where you find big South African businesses, such as Shoprite, MTN and Protea, most of the Nigerian-owned businesses are small- and medium-scale in nature. Emeka Collins Ezinteje, secretary of the Nigerian Union in South Africa, told BDSunday that the biggest reason for this remains South Africa’s tough laws that tend to repel investments. “We are pushing but the stringent laws in South Africa are not encouraging investments. The conditions for getting permits here are very difficult,” Ezinteje said.
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A Nigerian trade expert said that South Africa has assumed predatory behaviour, tapping into opportunities in Nigeria while closing its own market. A Nigerian businesswoman told BDSunday in South Africa that investment and labour laws in the country are not favourable to investors. “For example, if you own a manufacturing company, you must pay your workers a minimum wage, which is equivalent to 2 euros per day. The government protects workers more than businesses and you must employ a certain very large percentage of South Africans,” she said. “So, if you plan to produce here and export to Nigeria and other countries, your price may not be cheaper than those that produce in Nigeria,” she added.
Trade relations
Nigeria and South Africa do business together. The volume of trade between Nigeria and South Africa rose to N1.3 trillion about (R.62 billion) in 2015, according to the South African High Commissioner to Nigeria, Louis Mnguni. “Nigeria presents a huge market with a population of over 170 million people and vast resources, while South Africa presents the technical know-how in developing industries,” said Mnguni.
South Africa’s Minister of Trade and Industry, Rob Davies, said last year that Nigeria’s exports to South Africa hit N552.2 billion (R23 billion) in 2016. Conversely, Davies said South Africa’s exports to Nigeria slightly declined to about N153.7 billion (R6.4 billion) in 2016, according to a statement from the country’s Department of Trade and Industry. He said the two countries “continuously traded goods at high capacity and Nigeria maintained the trade surplus of R23 billion (N552.2 billion) in 2016”.
Battle for supremacy
Nigeria and South Africa have often seen each other as competitors. South African press went wild in 2014 after Nigeria rebased its GDP showing it was the largest economy in Africa. South Africa has a solid infrastructure base and an organised economy, but Nigeria’s infrastructure is decrepit. However, Nigeria’s population provides more opportunity for investors than South Africa.
Wikipedia recalls that Nigeria acted against South Africa to replace the incumbent Jean Ping, who Nigeria supports, with South African Home Affairs Minister Nkosazana Dlamini-Zuma for the powerful position of the African Union Commission chairperson. Relations further deteriorated when South Africa backed incumbent President Laurent Gbagbo for control of Côte d’Ivoire in 2011.
However, after Dlamini-Zuma won the election, Olugbenga Ashiru, Nigeria’s then Minister of Foreign Affairs, stated that Nigeria supported Ping for the position of AU chairperson in “a position which was principled along with our ECOWAS members and we stood by it”, adding, “But as usual, people can insinuate that once Nigeria was not in the camp of South Africa, it means that Nigeria is against South Africa. We are not against South Africa.”
READ ALSO: In South Africa, Shoprite’s exit returns focus on Nigeria’s tough business environment
Nigeria and apartheid South Africa
Many young South Africans do not know Nigeria’s positive role towards ending apartheid in the country. During the apartheid era, for which Mandela spent 27 years in prison, the Nigerian government issued more than 300 passports to South Africans seeking to come in. Apart from setting up the National Committee Against Apartheid (NACAP) in 1960, Nigeria gave material and financial support to the freedom fighters in South Africa.
Nigeria provided $5 million to the ANC and the Pan Africanist Congress (PAC) annually during the period, setting up the Southern Africa Relief Fund (SAFR) in 1976 to bring relief materials to the victims of the apartheid. The then head of state, General Olusegun Obasanjo, contributed $3.7 million to the fund and personally donated $3,000 to the fund. Moreover, all Nigeria’s civil servants and public officers were mandated to make a 2 per cent donation from their monthly salary to the SAFR. Nigerian students skipped their lunch to make donations, which eventually hit $10.5 million for South Africans. Sonny Okosun, a Nigerian musician, wrote the hit song “Fire in Soweto” in 1977 as his contribution to the anti-apartheid struggle.
Xenophobic attacks
Black South Africans have attacked and killed many Nigerians in the country, with authorities and the police as accomplices. In October this year, a 25-year-old Nigerian, Ibrahim Badmus, a native of Lagos State, was killed by the South African police at Vaal Vreneging, near Johannesburg. This occurred less than a week after Jelili Omoyele, a 35-year-old cellular phone technician, was shot dead at Doornfontein, near Johannesburg. These are two of many tales of killings and maiming perpetrated by South Africans. A group is known as Economic Freedom Fighters ( EFF), a South African revolutionary socialist political party, invaded the home of a Nigerian missionary and took over his house.
The sins of Nigerians in SA
At the Wonderboom Train Station located at Pretoria North on November 13, a young man of less than thirty was descending an overhead bridge. He seemed uneasy. On sighting the South African police, he took to his heels and ran across the road to Erich Street, connecting to Vaandrager Street. “He is running. He is a Nigerian, a criminal,” said some police officers who were waiting for a train.
Unscrupulous Nigerians have built drug cartels in South Africa, bringing disrepute and uneasiness to genuine Nigerian migrants. South Africans accuse Nigerians of using their country as a base for drug dealing. “They seem to have some ingenuity in that,” a marketing director in a manufacturing firm told BDSunday. “People see Nigerians as people who do drugs,” Carrier du Plessis, a freelance journalist for Mail & Guardian, said.
Xulu Masike, a South African factory worker, said Nigerians are not only involved in drugs but also other crimes. “If you lose your credit card, go look for it in the Nigerian community. They will identify the PIN and collect all your money,” Masike said. Ntuthuko Zwelini said what annoys him is that Nigerians use their ill-gotten money to deceive South African women. “They are often rich and flaunt their wealth on our women. Our women fall easily for them,” Zwelini said.
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Positive side
Carrien du Plessis pointed out that many Nigerians are into criminal activities in South Africa, it was wrong to paint all Nigerians with the same brush. “I know a lot of Nigerians that don’t sell drugs,” she said. “The perception here is also that Nigerian men are very good husbands. They stand by their families, unlike South Africans,” she added. According to Ezinteje earlier cited, most of the xenophobic attacks on Nigerians in South Africa have a political undertone.
“Crime has no nationality. Nigerians are involved in crimes but not just them. The problem here is that most black people claim to be Nigerians. That’s why the Nigerian Union issues ID cards. South Africans are involved in crimes too,” he stated. He, however, blamed the sins of some Nigerians in South Africa on societal pressure.
“The problem is the kind of orientation people have when they arrive in this country. There is much pressure at home. But what some people do not know is that there are lots of opportunities here and you can survive if you do genuine things,” he said. “But I blame mostly the leaders at home. Our leaders should come to terms with the reality that something has to be done to make sure that basic things are in place. People just don’t do things right in our country which is why people leave Nigeria for South Africa. These are young people who are not happy and are desperate. What Nigerians do here is a reflection of what we do at home,” he added.
Chinese strategy
China often faces xenophobic slurs and attacks in South Africa. Erwin Pon, chairman of Chinese Association Guateng, told BDSunday that what they did after facing xenophobic attacks on the social media in January this year, which Nigeria could emulate, was to prosecute those involved. “We had to take the people to court. Some of our people have their third and fourth generations here, so we felt we needed to do something against it,” Pon said.
ODINAKA ANUDU, just back from South Africa
