Monday, September 17, 2012

NIGERIA: The newest destination for luxury goods including private jets.

Director-General, Nigeria Civil Aviation Authority, Dr. Segun Demuren and Minister of Aviation, Mrs. Stella Oduah

Private jet ownership in Nigeria has grown by 650 per cent, from 20 jets in 2007 to over 150 jets in 2012. According to documents sighted in aviation agencies, the development means that wealthy Nigerians acquired, at least, 130 private jets with a sum of N1.02tn ($6.5bn) within the last five years. This put the private jets aviation market in Nigeria (the monetary value of all private jets in the country) at N1.18tn ($7.5bn), using $50m as the average cost of each brand new private jet. A private jet goes for between $40m and $65m, according to the websites of major private jets manufacturers, like Bombardier of Canada; GulfStream and Hawker Siddley of United States; and Embraer of Brazil.

According to findings, the common brands of private jets in Nigeria are Gulfstream 450, 550 and 650; Bombardier Challenger 604, 605; Global Express; Embraer Legacy and Falcons; and Hawker Siddley 125-800 and 900XP. Top aviation officials told our correspondent on Friday that Nigeria currently rivalled China as one of the two fastest growing private jet markets in the world. An official with in-depth knowledge of the situation, who spoke under condition of anonymity because he was not authorised to comment on the matter, said most of the jets were bought by top politicians, oil magnates and other business moguls in Nigeria.

He explained that the economic downturn in Europe and the United States had made Nigeria and China to become two of the fastest growing private jet markets in the world. He said, “Two countries buying private jets now are China and Nigeria. Europe and America are going through turmoil; so, their people are no more buying. This accounts for the trend that whenever some of the private jet manufacturers develop any new jet, they take them to Nigeria and China.”

“The private jets in Nigeria are owned by top politicians, oil magnates and business moguls. It is difficult to get the real identities of owners of some of the private jets in Nigeria because they buy them through some foreign companies in North America, especially the US. The foreign company then leases it to another company in Nigeria.” 

Investigation by our correspondent also revealed that there were still several private jets on order by wealthy Nigerians. Some of the jets, it was learnt, would be delivered this year, while others would be delivered in 2013 and 2014. A top official of the Nigerian Civil Aviation Authority, who asked not to be named, said representatives of the owners of the private jets on order had already notified the agency about the order. This, he said, was necessary for the purpose of registering the aircraft in Nigeria. According to him, some of the private jets also come with foreign registration credentials.

The Managing Director of Aero Airlines, Captain Akin George, had recently commented on the increasing number of private jets being parked at the Nnamdi Azikiwe International Airport, Abuja. He particularly lamented the fact that most of the private jets carried foreign registration credentials. He had subsequently called on the authorities concerned in the country to make registration processes in Nigeria friendly and attractive. During a recent visit to Abuja, our correspondent observed that over 40 private jets were parked at the terminal.

The CEO of another airline also said that during political meetings or big functions in Abuja, over 50 private jets were usually seen parked at the Abuja airport. These, he said, were different from the ones parked at the Lagos and other major airports across the country. “If you go to the old local wing at the Abuja airport, there is virtually no place to park private jets again,” he said. Just recently, a team of officials from the headquarters of Bombardier in Canada arrived at the Executjets Private Hangar at the Murtala Muhammed Airport, Lagos, to showcase one of their latest private jets, Global 6000.

The team was led by the Sales Director, Africa, Bombardier Business Aircraft, Mr. Robert Habjanic, who said that the team was on a tour of 12 cities in Africa, including Lagos. Habjanic, who spoke with a few aviation journalists, told our correspondent that Nigeria was the company’s largest market in Africa, with about 35 Bombardier-made business aircraft currently flying its airspace. He said the team had also showcased the relatively new business jet in other parts of the world.
He confirmed that “private business in Nigeria has been growing tremendously in the last five years.” He attributed this to the fact that “Nigeria is an emerging market.”
The growth in the purchase of private jets in Nigeria has also led to the development of multimillion dollars private jets hangars, where repairs and maintenance could be done in the country. Some of these include Execujets Nigeria Hangar, Caverton Hangar and EverGreen Hangar, all located at the Lagos airport.

Speaking on the development, industry expert, Mr. Olumide Ohunayo, said, “The economy is expanding, with increasing investments within the country and the region. This will invariably necessitate instantaneous travel that scheduled airlines cannot provide.

Can we add also that Nigeria has become a major market destination for high end smart phones especially the Black Berry brand, luxury cars including Bentley, Lamborghini and other luxury goods. Beauty spas are springing up in every city just as franchise clothing chains are opening shops in malls dotting several cities in the country. Food and beverage companies are also jostling to find a niche in this emerging market of 168 million people with a lifestyle that is not in sync with the nation's economic growth and prosperity. Nevertheless, it is a market worth a try for the business savvy.






Email us on inquiry@ibgnigeria.com if you need local assistance with market entry.

Culled from the Nigerian Punch Newspapers.

Africa's super-rich put their foot down...as Nigeria's mini-elite in Lagos and Abuja enjoy charmed lives.

  • of the Guardian in Lagos
  • Porsche in Lafgos
    Porsche has opened a new car dealership in the heart of Lagos' wealthiest district, Victoria Island. Photograph: Reuters
    On an otherwise ordinary-looking, potholed street in the district of Victoria Island in Lagos, Nigeria, is a stone encrusted gate with personalised initials. In the garage beyond, draped in protective covering, is a fleet of eight sports cars that include Lamborghinis, Ferraris and Porsches.

    "On a typical weekend these guys head to the boat club to board a private speedboat or jetboat to Ilhasa," said Michael (not his real name), a regular at the house of the Nigerian high-society figure, referring to an exclusive beach known as Millionaires' Playground, an hour away from the polluted lagoons of the commercial hub. "There'll be girls in bikinis playing volleyball, barbecues and parties all night.

    "On the right Saturday, you can bump into [Africa's richest billionaire, commodities trader Aliko] Dangote having a beach party at Ilhasa. If you're a so-called big boy in Lagos and you don't have a beachhouse, you're kind of whack," Michael concluded, sipping a Hennessey on the rocks inside an exclusive Lagos club.

    Welcome to the charmed lives of a tiny elite that make up the super-rich across Africa. While millions live in crushing poverty, breakneck growth across the continent has expanded wealth beyond the traditional circle of government workers – for a lucky minority. This is the market the makers of Porsche hope to tap into, choosing to open its latest showroom on the continent – the first was in South Africa – in Nigeria. In an ultra-modern glass and steel building, the auto maker unveiled its latest Carrera and 911 models. "It's the sports car that can still be used everyday," Africa Porsche director George Willis said.

    About 200 Nigerians own the luxury cars, each costing up to $180,000, brand manager Michael Wagner said. Porsche's 4x4 Cayenne is by far the most popular model imported into Africa, suitable for still poor roads. In Nigeria, there are plans for a Porsche racetrack and a Porsche club "where people get together and compare, and go out on drives together", Wagner said, shortly after officials revved the latest Carrera model for reporters and thrilled onlookers, some posing for photographs in front of the gleaming black car. In the sticky heat outside, an employee said owning one of the personalised Porsches he was washing would be "a dream. But I only earn $120 a month," he shrugged.

    While Victoria Island is home to some of the planet's most expensive real estate, most of Nigeria's Porsche sales will come from Abuja, the makers believe. In the moneyed capital city, where wedding-cake mansions overlook smooth cloverleaf highways, wealth is a more conspicuous status symbol.

    "There's a big market here. For example, I have a Bentley, a Porsche and a Ferrari, so I can easily buy another brand-new one," said one businessman from Abuja who sponsors golf tournaments as a hobby. But he added: "People don't travel by road anymore, they go by air. So the Ferrari in the garage hasn't done 500 miles in three years."

    Others brands are also clawing out a slice of the super-rich pie in Abuja. Government fat cats and a new breed of young entrepreneurs flock to the boutique of the designer Chris Aire, a Nigerian who is based in the US. The "king of bling" designs for the likes of Oprah Winfrey and Angelina Jolie, and opened his first boutique in Africa in December.

    Expensive spas compete to offer facials that smother pure gold leaf on customers' faces, and gleaming malls are popular with affluent shoppers. There are other signs of the super-rich, even as Africa's inequality gap yawns. Porsche is already planning a showroom in the Angolan capital, Luanda, similarly awash with petrodollars and ranked the world's most expensive city 10 years after coming out of a 27-year civil conflict.

    "Young guys with money need cars they can drive every day to show them off. There are cars that can survive potholes and there are cars that can survive potholes in Lagos," said a Nigerian oil worker. "Porsche are going to have to adapt to Nigerian terrain, the same way as Mercedes did [by marketing more off-road vehicles]."

    Shopping abroad remains the ultimate social status badge for many. Maddie, 33, from Abuja, who runs a boutique in between having gold-leaf facial treatments, said Dubai was fast edging out European capitals as the destination of choice. "I travel every two months but I couldn't cope with going to London with my two children alone when both their nannies' visas run out. They don't need visas to go to Dubai, so it's easier," she said.

    Still, luxury brand retailers are likely to flourish in a country where wealth is traditionally seen as a benefit to the community. "If we didn't have such terrible leaders only concerned with buying themselves things, everyone in Africa would be rich enough to buy designer clothes for themselves and all their friends," said Christina Akinjola, an unemployed secretary, as she stocked up on fake Chanel bags in the car park of a Lagos mall.

Lagos International Trade Fair beckons.

OVER 15 foreign countries have already signified interest to participate in this year’s edition of Lagos International Trade Fair, against 14 that took part last year.

According to the chamber in a media statement signed by the Public Relations Manager of Lagos Chamber of Commerce and Industry (LCCI), organizers of the fair, Tope Oluwaleye, the Chamber has concluded plans for Business-to-Business (B2B) meetings between indigenous and foreign exhibitors seeking trade opportunities and partnerships at this year’s Lagos International Trade Fair, which runs from November 2nd to 11th at the Tafawa Balewa Square (TBS) in the heart of Lagos.

This, he said, was in line with the theme of the 2012 Fair: “Promoting Trade for Sustainable Economic Transformation” and renewed drive by the government as well as sundry interest groups to showcase and promote potentials in the Nigerian economy. He explained: “LCCI decided to shift the venue of the fair, tagged ‘The Biggest and the Best’, from the Lagos Trade Fair Complex this year because of the ongoing construction work on the Lagos Badagry Expressway. The expansion of the road had posed huge challenges to commuters and   participants at the Fair last year.

“Already, feedback from already registered and potential exhibitors, especially from abroad, indicates satisfaction with the shift of the Fair grounds to Tafawa Balewa Square, which is easily accessible from most parts of Lagos. It is envisaged that this year will witness an increase in participation of exhibitors and visitors”.
He noted that this year’s venue offers a three-in-one interconnected fair grounds through the main bowl of the TBS, the adjourning cricket pitch and the Club Arcade car park. Combined, these three locations have a total exhibition space of over 40,000 square metres, more than the required 35,000 to host the Lagos International Trade Fair.

"The Lagos International Trade Fair is the flagship of the Lagos Chamber of Commerce and Industry, the oldest chamber in the West African sub-region. LCCI has organised the Lagos International Trade Fair for 26 consecutive years", he said.

PS: Email inquiry@ibgnigeria.com for local support if required.

Culled from the Nigerian Guardian Newspapers.

Wednesday, June 13, 2012

Nigerian Government approves new visa regime to attract investors

The Federal Executive Council has approved a new visa policy for the country designed to boost tourism, attract foreign investment and create employment opportunities. Minister of Information Labaran Maku said this while briefing State House correspondents after the weekly Federal Executive Council meeting presided over by President Goodluck Jonathan at the State House, Abuja. Maku said the council’s approval was sequel to a memorandum presented by the Minister of Interior, Comrade Abba Moro, for the harmonisation of Nigeria’s new visa policy.




Explaining the policy, Moro who was also at the briefing, said the new visa regime contained new innovations and elements that would promote Nigeria’s strategic interests. The minister said the new policy would facilitate easier provision of visa to foreign investors, strategic visitors and tourists. He said that the policy would allow for a visa term of up to 10 years for strategic investors, while strategic visitors and government officials coming to Nigeria could have access to visas at the point of entry.

“Today we have a visa policy in place now that is targeted at boosting tourism, attracting foreign direct investment, opening up the economy for employment opportunities and above all, a policy that seek to secure our borders".
“If a business man or a tourist or a trade delegation or for that matter a government delegation even headed by the Presidents or Heads of State of these countries have reasons to visit Nigeria at short notice to do business with Nigeria and if by any coincidence, we don’t have embassies in such countries, such delegation or group can come to Nigeria and obtain their visas at point of entry.

“We have other categories, we have short term visas, we have temporary resident visas, we have permanent resident visas and of course, a new introduction now is that we have investment or skill transfer visa category in which case if you have a particular level of investment that you want to make in Nigeria that can add value to the economy of the country, you can be given certain categories of visa.

Source: www.vanguardngr.com

Thursday, May 24, 2012

Taking Notes from the Thais.

Thailand is a well known business and leisure destination located in the prosperous region of South East Asia. The country conjures different meanings to different people. Among many Nigerians, Thailand is known for its parboiled rice for which the country spends $US700million every year in rice import to feed its 160 million people. It is also known as a popular route in the hard drug business. To some others especially in Europe, it is a leisure destination popular for its 'gogo bars', massage parlors and romantic beaches. No matter how you look at it, Thailand has grown to become one of the Asian Tigers, with well developed infrastructure, massive foreign direct investment and one of the lowest unemployment rates in the world.
  
Could it be said that the country was lucky? I dont think so! Could it then have been by dint of hard work, focussed leadership and a government determined to get its people out of poverty? It may not be eldorado yet but I see the country getting there! As a matter of fact, it is the 4th richest country by GDP per capita in South East Asia after Singapore, Brunei and Malaysia.

The country's industry and agriculture sectors were traditionally intertwined. Today, however, industry has eclipsed agriculture in terms of contribution to GDP. The rapid growth of this sector can be attributed to free market forces, limited government assistance, and the private sector's quick response to shifting market demands.The increasing cost of labor has also led to a departure from labor-intensive ventures. To date, only the manufacturing industry contributes substantially to national income, particularly in food processing, automobiles, electronics, and petrochemicals. I am sure you are aware that it also serves as an 'anchor economy' for the neighboring developing countries of Laos, Burma and Cambodia.

The initial move into industrialization in the 1960s was characterized by import substitution, which mainly involved the processing of its bountiful agricultural produce. In 1972, a new Industrial Promotion Act signaled the shift in government policy to an export-oriented economy. This new emphasis began the rapid diversification of the industry sector which saw the rise of several industries, including petrochemicals, textiles, transportation equipment, electronics, iron and steel, and minerals. Experts predict that by the year 2015, Thailand would be one of the ten motor vehicle producing countries in the whole world! Do you know that Thailand is also home to medical tourism? Treatments for medical tourists in Thailand range from cosmetic, organ transplants, cardiac, and orthopaedic treatments to dental, cardiac surgeries and various therapies.

The manufacturing sector constitutes Thailand's main industry, producing a wide variety of goods such as textiles and garments, plastics, footwear, electronics, integrated circuits, computers and components, automobiles and parts, and cement. Manufacturing facilities are mostly located in Bangkok and on the Eastern Seaboard, which was launched in 1977 as the long-term site for large-scale small, medium, and heavy industries. In 1993, the manufacturing sector employed 10 percent of the entire labor force . By 1998, however, the sector already employed approximately 20 percent of the Thai workforce, who are among the highest paid workers in the country along with those working in the service industry. The manufacturing sector expanded its contribution to GDP, paving way for its position as one of the fastest growing economies in South East Asia, the second largest economy in South East Asia and the 24th largest economy in the World.

Given that manufactured goods are produced largely for export purposes, its share of export earnings grew steadily from 32 percent in 1980 to 74.7 percent in 1990 to 84.5 percent in 1999. Presently, its top export markets are the United States, Japan, the European Union, Singapore, Malaysia, Hong Kong, Taiwan, and China, with the United States and Japan jointly absorbing 36 percent of the country's exports. 

In sub Saharan Africa, Nigeria is its major trading partner importing well over  one million tonnes of Thai rice, valued at $700m every year. Meanwhile, the trade imbalance sees Nigeria exporting a measly S10million worth of petroleum and $20million worth of gas to this country that has since departed from monoculture.

As if to teach Nigerians some lessons in economic diversification especially in the manufacturing sector, a team of Thailand business people was in the country to explore investment opportunities. Did we take notes?

Saturday, April 21, 2012

Americans and others urged to invest in Nigeria.

Leading a large delegation of Nigerians to the US ExIm Bank's 2012 Conference, Vice President Namadi Sambo says investment in Nigeria's non-oil sector is the next big thing after the exponential success in information technology as he spoke during the session on Global Competitiveness through Exports in Washington, USA.

He stated that 'there is room for improvement in our economic relations if the US could encourage their private companies to partner with Nigerian private sector, particularly in the area of power generation, transmission and distribution'. Sambo further revealed that the federal government had built 10 thermal plants that would be managed by the General Electric of the USA,  the Mambila hydro project, the construction of 200 dams to enhance power generation and agriculture, as well as facilities for solar energy.

He also said that institutions that would protect investment in the country, such as the National Electricity Regulatory Commission (NERC), Bulk Trader, Gas Aggregator, National Asset Management of Nigeria and others, have been established to add value to the power sector.

He noted that the partnership would give room for improvement in the transportation and agricultural sectors and fast track the Federal Government's transformation objectives of making agriculture a serious business. (As a matter of fact, at least 50 agricultural firms and companies in the agro allied industry have indicated interest in an Agric Forum tagged Transforming Agribusiness through Investment holding in Washington D.C).

He added that the ExIm Bank's special initiatives especially in the area of support for small businesses exporting goods and services to create jobs for the country's teeming youths are much welcomed by Nigeria. The Transformation Agenda of the Federal Government also address the need for human capital development and infrastructure. According to him, there is an initial confirmation of about $1.5 billion by the ExIm Bank to support the growth of the economy of Nigeria and the World Bank is also supporting with partial risk guarantee to ensure that investors are properly protected.

He concluded by assuring the ExIm Bank that foreign investors would not regret putting their resources in the Nigerian economy.

Source: This Day and Business World Newspapers.

PS: For rapid access to US Ex-Im facility, contact Infoplus/IBG Nigeria, representatives of TCG Finance, agents to the US Ex-Im Bank on inquiry@ibgnigeria.com  or call +234 1 878 2864.

Wednesday, January 18, 2012

Business Opportunities in Nigeria's Subsidy Reinvestment and Empowerment Program (SURE P)

The Office of the Coordinating Minister of the Economy recently released a breakdown of Potential Benefits from Budget 2012 and the SURE Program.

Below in tangible terms are some of the significant allocations that have been made to essential sectors of the economy, both in the 2012 budget as well as the recently-launched Subsidy Reinvestment and Empowerment Programme (SURE-P).

This programme is a 3—4 year programme designed to mitigate the immediate impact of the removal of fuel subsidy and accelerate economic growth through investments in critically-needed infrastructure.

It is noteworthy that, while the 2012 budget allocated the best possible amounts to these critical projects, additional resources are allocated to the same projects in the SURE programme to ensure that they are completed at faster rates than envisioned in the 2012 budget. Some of the projects and allocations are as follows:

Works

N11bn is allocated to the Abuja-Lokoja road in the 2012 Budget, with an additional N14bn from the SURE-P.

N6bn is allocated to Benin-Ore-Shagamu, with an additional N16.5bn to be financed through SURE-P.

N3bn is allocated to Port-Harcourt–Onitsha road, with an additional N5bn from the SURE-P.

Similarly, N18.5bn is allocated to Kano-Maiduguri road, with an additional N1.5bn from SURE-P.

Provision is made in the 2012 budget for construction of the Second Niger Bridge (N2bn) and Oweto Bridge (N3.5bn). An additional N5.5bn and N4bn would be spent on both bridges respectively from the SURE-P.

Provision of N23.5bn is made for maintenance of roads and bridges across the country through Federal Road Maintenance Agency (FERMA).

Agriculture & Rural Development

The total allocation to the sector is N78.98bn
N4bn is allocated to research and mechanisation
Provision of N1.22bn is made for the construction of access roads to each of the 6 Staple Crop Processing Zones.
Value Chain: N720 million is allocated to the development of value chains in cocoa, rice, maize, livestock, cotton and others sectors.
N1bn is allocated to the Price stabilisation scheme.
N610 million to facilitate for the access to credit, fertilizers and seeds.
An additional sum of US$500m is expected from Development Finance Institute to support the sector.

Transport

Rail lines: The 2012 budget allocates N3.95bn, N3.15bn and N3.35bn to the construction and completion of Abuja-Kaduna, Lagos-Ibadan and Ajaokuta-Warri rail lines respectively. In addition, the SURE-P allocates N11.6bn to the Abuja-Kaduna line and N9.3bn to the Lagos-Ibadan line.
Provision of N800mn is made for the procurement of wagons, coaches and locomotives.
Dredging project: N1.2bn is allocated to the dredging of Lower River Niger (Warri-Baro).

Education

The total allocation to the sector is N400bn
N11.6bn is allocated for existing universities.
N7.7bn is allocated for the restructuring to Unity Schools.
National Teachers Institute: The 2012 budget allocates N3.5bn to the retraining of teachers for basic education and training in innovative teaching.
Moreover, an additional N24.6bn will be spent on vocational training centres from the SURE-P.

Health

N4.6bn is allocated to the Polio eradication programme
N3.5bn is allocated to the procurement of HIV/AIDS Drugs
The sum of N174 million is allocated to Integrated maternal, newborn and child health strategy, including capacity building, and promoting school health initiatives.

N8.42bn is allocated to Federal University Teaching Hospitals.

N6bn and N3.6bn are allocated to the procurement of vaccines and midwifery service scheme respectively.

An additional N73.8bn will be spent on Maternal and Child heath from SURE-P.

Aviation

Various Airports: N22.2bn is allocated for the modernization of airport terminals and upgrading of facilities in the six geopolitical zones of the country.

Federal Capital Territory Administration

N3.1bn is allocated to the construction of a 20,000m3/hr lower Usuma dam Water Treatment Plants.

N2.5bn is allocated to the construction of Cultural and Millennium Tower.

N1.25bn is allocated to the Development of Idu Industrial Area (1b Engineering Infrastructure).

Various road projects including the completion of roads B6, B12 and circle road (N4bn), rehabilitation and expansion of airport Expressway (N7.53bn).

Niger Delta
East-West Road (Section I—V): The 2012 budget allocated N22.2bn to this road. In order to accelerate its completion, an additional N21.7bn is allocated in 2012 from the SURE programme.

Water Resources
N1.2bn is allocated to the construction of Central Ogbia Regional Water Project.
A total of N4bn are allocated to the construction of dams.
Other provision for water facilities (i.e. regional water supply scheme) of N8bn.
Rehabilitation of river Basin authorities (12 nos) of N13.91bn.

Moreover, over the period 2012-2015 an additional N205.5bn will be invested in rural water scheme, water supply scheme, irrigation scheme and other water related projects from SURE-P.

Let us talk: Email us on inquiry@ibgnigeria.com or call our office on +234 1 878 2864.