Institute for Security Studies executive director Dr Jakkie Cilliers says Nigeria is an “interesting” State characterised by its position as a top African investment destination.
“Nigeria’s investment appeal appears to be divorced from the threats posed by Boko Haram and other developmental challenges. [Nigeria’s capital] Lagos seems to be irresistible to investment flows [as a result of its] market size,” he said during a keynote address at a Frontier Advisory Africa Risk and Investment Forum on Wednesday.
Describing Nigeria as an “incredibly” corrupt State with “incredible” potential, Cilliers added that the country offered the ambitious investor a high-risk high-return proposition, despite being a dysfunctional country in many ways.
In a recent opinion piece, Frontier Advisory senior analyst Simon Schaefer and director Hannah Edinger, argued that
Nigeria’s rise was inevitable; the only surprise being how long it took to do so.
This followed a rebasing of Nigeria’s economy earlier this year, which showed that it had surpassed South Africa as the continent’s largest economy, boasting a gross domestic product (GDP) of $510-billion.
But the report warned that “no number-crunching exercise” could conceal the fact that Nigeria’s economy still had a long way to go to reach the structural, institutional and business sophistication of South Africa.
The report further noted that security challenges would continue to scupper the real growth potential of the country.
It added that, to create a viable and vibrant economy and to tackle poverty, unemployment and inequality, government needed to focus on the quality of growth and not necessarily the speed and quantity thereof.
Despite Nigeria’s investor popularity, Schaefer and Edinger said South Africa remained the continent’s largest recipient of portfolio flows and ranked as the largest holder of inward foreign direct investment stock in Africa.