SERIOUS ECONOMY
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EDITOR’S NOTE
Serious About Relocating? Welcome to the second edition! Through fasting, prayer and useful information, we intend to keep you engaged in reading about the economy!
We predicted that we may not have ministers by the next edition…we predicted right. However, you'll be pleased to know that despite the hold-up, we are able to survive. We're all hopeful that we will be living and thriving by the next edition.
Montreal, Canada
We therefore urge you in this edition to consume local…watch Nollywood, eat and live local and if you're tech talented, dollar earning may be a possibility for you…without relocating!
from Nigeria with love.
Yours,
Lady Khaf INSIDE
Tech-Know Trends
Pirates of the Narribean ChiChi O.
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Sheltered in Our Homelessness
From Nigeria with Love 2 TobiTosin O.
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TobiTosin O
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Lush Lash O.
NOT SO SERIOUS
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from www.dilbert.com
Pirates Naribbean of the
mobile devices makes it a real winner! However, it is not enough. Nigeria requires both digital and traditional distributions channels for any industry to be successful at this time.
Money is Coming Since our "Ogas at the top" in CBN have initiated a Creative Industry Financing Fund, the opportunity has arisen for the future RMD's & Omotola's to begin to emerge and give us dope movies back to back. However, to ensure that the aim of the fund is achieved and that our unemployed youths can get more Nollywood jobs, it is imperative to solve the problem of piracy. We found an interesting project on our wavelength and we're curious to see how far it
We Recommend 10/10
can go with tackling the problem. It views piracy
Put some respeck on Nollywood! We're sure Yemi's boys at the NBS will be able to capture the full benefits of the film industry in our GDP, if Alaba boys did not exist. But they do. So, o dikwa a very tricky situation.
as a distribution model to collaborate with and reform. The Nollywood Upgrade Project seeks to combat the impact of piracy by improving the
The World Bank (how they find their own info in this “No Data Nigeria” is amazing sha, but you guys love
production quality and formalizing the
when we throw in these according to *insert a renowned data source* - apologies for the digression)
distribution of movies. "We're building institutions
says the domestic film industry, known as Nollywood, produces at least 40 new movies every week
to make the industry sustainable," says Moji
which creates up to a million indirect jobs. Also don't mind all these people who complain about their
Rhodes, Coordinator of Innovate Lagos.
poor quality and content – we love it. EbonyLife Films' Chief Daddy closed 2018 with a record breaking run of about N235 million. Kemi Adetiba's King of Boys, the second biggest movie of 2018, scored over N220 million. Obviously, someone must be watching these things. We the people (including Netflix of America gangan) are enthralled by the gripping narratives of
The first phase involves the training of film-makers. I know! It just sounds like a broken record.
forbidden love, the power of good over evil, and rags to riches. Nollywood has been identified as a major industry which boosted West Africa's GDP to $510 billion.
However, the second phase is aimed at promoting widespread distribution using
Movie production also contributes significantly to the commercial activities in the area in which a movie is produced through its patronage of local businesses in the course of production. In short, Nollywood has fantastic potential but destiny destroyers, in form of pirates, are after it.
traditional and digital channels. It will employ innovative channels to bring pirates into the fold legitimately. This would be very
The Badt Guys
useful owing to the deep market knowledge
Despite the humongous breakthroughs recorded by the Nigerian entertainment industry, piracy
these pirates possess.
remains one of its greatest challenges, resulting in a colossal loss of revenue running into billions of
Why will these solutions work? The pirates keep
Naira every year. Piracy is an infringement on the rights to reproduce, distribute or perform protected
their jobs, security is assured and a competitive
works. Roughly 8 out of 10 movies present in the market are pirated (Alaba boys, weh done). Essentially,
market emerges. We all know competition drives
artistes get back only 20% of the revenue generated from the sale of their work.
innovation in businesses.
Can Everyone Really Be Happy? This problem got us thinking about how to turn the negative of piracy into a positive for both the movie industry and the employment situation in Nigeria. We like to think of pirates as 'low-cost distributors'
At the same time, the producers will reach more customers, lose less money and sleep better.
because they provide easy access to the movies, creating huge popularity for them. The first solution to piracy involves companies like IrokoTV (The Netflix of Africa) who have digitized Nollywood content for cheap — N3,000 a year. Even DSTV isn't competing with this. More so the ease of access through
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From Nigeria with Love 2
.No
Oil Times
Since the beginning of the year, oil production in the country has been below the budgeted benchmark of 2.1mbpd (million barrels per day- dear readers, we must be intelligent, so we abbreviate) due to OPEC global cutbacks on production. This has caused a reduction in expected revenue despite increased oil prices.
The non-oil sector of the Nigerian economy has been the winner so far, contributing more than 90% of the total GDP in the economy. With four major drivers ICT, Agriculture, Transportation and storage, trade & construction, it is obvious who or what the driver of the economy really is. We told you farming was NxtLvl!! Also now would be the time to send your kids to coding school- ICT is NxterLevel…
The Price Of Spaghetti Did Not Change But Ramadan Increased Tomato Prices Inflation remained at the 11% margin as expected at this time of the year. The effect is that spaghetti will still be N220 in Lagos and that favorite beef sausage roll will not leave N50 anytime soon. Experts have attributed this consistency to fixed oil pump prices and persistent food price increase across the country. The good news is that values are expected to be better in the second half of the year but the bad news is that this. improvement may have little effect on the cost of household goods.
Let’s Ask Netflix To Collect Naira Coz Dollar Na Die Since the beginning of the year, CBN has reportedly invested $2.7 billion as an intervention into the foreign exchange market to create currency stability. We are enjoying now o, but our problems (poor tax collection, low revenue and oil dependency) have not reduced, so in the long run, this intervention is unsustainable. The NxtLvl government is also increasing its expenditure with new minimum wage (expected to increase expenditure by 18%) and an unsustainable oil subsidy payment of N10Trn. Experts are predicting FX impact in H2 meaning our Netflix and chill expenses might go up. Our advice - better get used to local content.
You Snooze, You Lose May 29 has passed and…nothing. There is an urgent need for the government to hit the ground running and resurrect this dozing economy. Our brethren in South Africa also carried out elections in the same period but unlike us they already have a cabinet (might we add that just like Rwanda, it is gender balanced 50-50; Nigeria which way for your girls o). The delay in appointment might also affect the nation's growth in H2 as it did in 2015.
Would we be Serious if we did not give you gist about the Economy? Since the last publication, Nigeria has moved on from the elections and the economy has gradually adjusted to the stagnancy earlier recorded; somebody shout Hallelujah. The results looked positive as our economy grew by 2.01%, its strongest Q1 performance since 2015. Our big brothers IMF and the World Bank had predicted that it would grow at 1.9% but look at that, we performed beyond their expectations. There is however, ample cause to worry: rising unemployment level, low economic growth rate for one of the fastest growing populations, poor standard of living among others, but maybe we can relax a bit, there is rice in Kano. Despite the risky environment and uneven growth across industries, the economy remained resilient. Let us just say things did not get as bad as some people expected; Ope oh!
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More importantly, the economy will get the needed boost if the formation of a new executive and legislature takes place early enough to aid the implementation of the 2019 budget. Specifically, sectors like health (with negative GDP of 0.18%), transportation (growth of 19.18% but extremely working below its efficiency), education (contributing only 2% to the total production) and sub-sectors like construction (growth of 3.18%), which rely heavily on government spending for growth, will experience a material lift in productivity in the second half of the year. In essence, baba God help us help our government to help us live well.
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Ttechknow Ttrends
For the last 100 years, oil has been the best selling commodity in the world, it is the reason why countries like Saudi Arabia, Qatar and even Nigeria have all had their fair share of prosperity; some more prosperous than others. In 2006, five of the top 10 companies by market capitalization were energy companies that made their billions from oil revenue. However, according to The Economist, by 2018 ExxonMobil was the only oil company listed in the top 10. Even though the oil producers are still prosperous, most of them are investing heavily in the oil of the future. The oil of the future is data and there is really no successful data ride without technology as the driver. It is no wonder everybody wants to be up to date with technology, we all want to have the latest gadget, post selfies with the latest Snapchat filter and read the latest gossip first thing in the morning. Organizations are restructuring to accommodate technology, social media is creating new celebrities every day and everybody is convinced that the digital sphere economy is worth billions - it is. It is therefore imperative to be up to date with terms, colloquialisms and trends occurring in the technology space so that when your child mentions API, you would be sure it's not a political party or the name of an anime. You have probably heard these terms and concepts used at meetings, gatherings or have used them yourself. In that case, this article brings it back to memory; otherwise, here's a quick lesson for you:
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You might not be so familiar with this term but at the mention of Bitcoin/cryptocurrency I am sure you would be able to relate. A block chain is system of distributed ledgers that can be used to store transaction information on a network. A block is a data structure that holds many transactions and other information necessary to validate the block, it is used to record a new transaction with the corresponding timestamp. In English, a block chain is a chain of blocks(information).
A block usually contains three components: data, unique ID and ID history. So imagine we have Mr Abubakar with N10,000 in his account, this is the data. The system assigns a unique code to Mr. Abubakar so everybody on the network knows that he has N10,000, information which is recorded in his ID history. If Mr Abubakar buys something and his balance drops to N9,000, his ID history is updated across the network so everyone receives the information. The previous state of his account is also stored. This is the basics of one of the most innovative technological trends of the last decade.
data is the new oil
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Block Chain Technology
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Satoshi Nakomoto — an alias for all we know — is said to have conceptualized the idea of the first block chain in 2008 which was then followed by implementation of Bitcoin , a cryptocurrency (really a story for another day). The block chain serves as a public ledger for all transactions on the Bitcoin network and is fast becoming a popular technology in Africa and Nigeria. A very sweet example is the Binkabi product which is using this technology to solve food crisis across Nigeria. Apart from agriculture, it is also applicable in supply chain, tax regulation, medical records, security, real estate among others.
Artificial Intelligence In 2004, Jeff Vintar released IRobot, one of the successful movies of that year, my personal favorite though was The Matrix where Neo had super powers (fun times). The caption on the world poster of i-Robot read “One man saw it coming” but the irony is that no one could have seen how the integration of AI into our lives would be so rapid as it is today. When we hear about AI, most people assume it's the apocalypse where robots will run the world; disclaimer alert though, machines already do. Artificial intelligence (AI) is the simulation of human intelligence processes by computer systems. The ability to simulate these intelligent processes is what makes them useful in the world today. These processes include learning (the acquisition of information and rules for using the information), reasoning (using rules to reach approximate or definite conclusions) and selfcorrection. Most of the systems we are familiar with already have some sort of AI presence which improves operations and ease of doing business. On popular streaming platform Netflix, AI is used to design customer experience using predictive analysis whereby from watching Lionheart, the system suggests other Nigerian movies with similar qualities for you to watch. When you
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Tech-Know Trends
search Amazon for a Bluetooth headset and every other page you visit is fitted with an advert for that product, AI is responsible. It gets even better when you visit a place and Facebook sends you friend suggestion of people you just met. The possibilities are endless as several companies are beginning to use this technology to create unique customer experience since it is able to analyze information.
Gig Economy The largest network of taxis in the world does not own a single taxi, one of the largest hospitality services in the world, Airbnb, does not own one house or bed space and all of that is possible due to digitalization. In times past, success used to be measured by the number of physical structures a company owned and used to provide its services. The gig economy has changed that. A gig economy is simply a free labor market system which is characterized by short term contracts and remote activities. The most unique feature of a gig economy is the presence of temporary, flexible jobs done by freelancers instead of full-time employees.
Speaking of, if you’re open to exploring this future of work style, Sterling Bank is accepting requests for jobs. If you’re a Tech person or you know a Tech person, please visit our careers site and reach out.
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A gig economy undermines the traditional economy of full-time workers who rarely change positions and instead focus on a lifetime careers. This trend was created due to the skill gap in areas with high barriers to immigration. For instance, a certain Tobi wants to design an algorithm for a company in China, he can work with the Chinese firm without having to relocate to China while working for his favorite financial institution.
This model reduces redundancy and the operating cost of business. The gig economy is supported by technology and an agile culture which is becoming increasingly popular as more businesses are beginning to adopt this model. When you reduce physical presence and increase online expansion, you reach your customers without having to interact physically. It is essentially the future of work
Several trends are changing the way we view the world which is now a global village. In this village data is king, technology is its driver and the internet is the town crier. The synergy among the parties has created unlimited opportunities which will keep changing with new advances and discoveries.
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SHELTERED IN OUR HOMELESSNESS
In Lagos, of the numerous problems we face, overcrowding and accommodation wahala are the biggest. The ratio of people to amenities results in endless struggles. From power supply to water supply to the roads (don't get us started on the famous Lasgidi traffic - it's our own Anthony Joshua vs Ruiz fight and unfortunately poor infrastructure is the winner beating the rest of us black and blue.)
Many health problems can be directly attributed to the overcrowding, which generally affects waste management, drainage (pollution) systems and general environment friendliness. The affordability of quality housing in the state especially is questionable as construction experts substitute quality for quantity in a bid to reduce costs eventually resulting in many cases of collapsed or sunken buildings; one of the most recent being the Ita-Faji, Lagos Island collapse which happened on March 13th and claimed over 20 lives. By 2050, the population of Lagos is expected to double once more, which will make it the 3rd largest city in the world. With less infrastructure than any of the other megacities, our struggles may well continue like Arsenal's trophyless European activities. With people on the streets and many others spending a larger part of their income on rent, the result is simple - a loss of productivity and economic hardship.
Relative Affordability Affordability is a largely relative concept determined by various factors but most importantly by ego. As of February 2019, the annual minimum wage stood at N216,000. Since experts have told us that, we spend about 60% of our income on food, it means only about N84,000 is available for housing among minimum wage earners. Meanwhile, the annual cost of a low service apartment in Lagos is estimated at N150,000. If you're a family man or woman with dependents, you would still need to cover clothing or pay school fees(although Sterling Edu-finance has got you covered).
There is also the factor of location- the costs of a threebedroom flat in Yaba and Ipaja would differ greatly. A person who desires to pay the premium of living in a central, developed commercial hub like Yaba would pay much more than someone in Ikorodu would.
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Lasgidi Efforts Between 2011 and 2018, Lagos State government reportedly allocated N390bn to the Housing and Community services for different housing projects in the state. Major strategies were implemented to achieve higher housing inclusion such as direct construction of houses on a massive scale, which reduced the perennial shortage of housing particularly for lowincome groups. While there have been different special reforms and housing schemes orchestrated by the government, the root causes of the housing problem have not been addressed.
Affordable housing is really a global problem so much that Nelson Mandela once said, “When a man is denied the right to live the life he believes in, he has no choice but to become an outlaw.” The mismatch of housing to people in Lagos has led to an increase in price because of the high demand to supply ratio which has caused an availability crisis. There is also the increasing case of fraudulent people who pose as house owners to rip desperate individuals of their hard-earned money for house rents, brethren say God forbid! There has been an increase in the violation of property laws and thanks to our “agile” judicial system; it might just continue to worsen. Way forward Dear government, let the private sector help. While the onus is on you to get sustainable funding and also to maintain the policy environment required to make building easier – (e.g. the 19 different payment points for building is a bit ridiculous!), involving the private sector will allow the solutions scale quicker.
Dear private sector real estate developers, re-think housing design to accommodate more Lagosians at affordable prices. Dear Lagosians, good luck! We will overcome our homelessness.
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Imagine a Nigeria, where
The lights never go off.
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Thank you! I hope you enjoyed being Serious!
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