“Welcome back to Nigeria” – the energetic handshake and warm smile of Adedayo*, one of the security guards in my Lagosian hotel, are truly catching. Though Nigeria is characterized by multifaceted conflicts, the country stands for so much more than a flourishing private security service industry.
Here are three things I have learned since starting to issue long-term loans to Nigerian banks in my capacity as Investment Manager at the German Finance Corporation “DEG”.
I was ready to jump in the deep end when I started my current job two years ago. My knowledge about Nigeria was like the coverage of this West African country in German media – sparse. And yet, Nigeria makes up for many headlines. It is home to more than 230 million people from more than 250 ethnic groups, speaking more than 500 languages. Did you know Google is available in Igbo and Yoruba? Currently the most populous country in Africa, Nigeria is said to become the third biggest country by 2050, following only India and China. Meanwhile, Nigeria’s economic hub Lagos is projected to become the biggest city in the world by 2100 with around 88 million inhabitants. Along with the country’s size, Nigeria’s cultural footprint is constantly expanding beyond its country borders. Have you heard about Wizkid performing with Beyonce? Nollywood joining Hollywood and Bollywood in the top three largest film industries? Jollof Rice being served in Michelin-star restaurants in London?
Nigeria is big and vibrant. Still, life is tough for many Nigerians. One reason has been soaring inflation. Last summer, on social media Amarachi showed how to keep a popular stew affordable by swapping expensive tomatoes with lower-priced watermelon. Our company driver William* told me that gasoline prices have tripled during the last year. I let economists do their job in drawing a more complete picture of the macroeconomic situation in Nigeria. However, it has always been challenging. Due to macroeconomic imbalances huge financing gaps exist in nearly every sector: from health to education to adaptation to climate change to the private economy covering agriculture, manufacturing and services.
In my work, I focus on the financing gap for micro, small & medium-sized enterprises (MSMEs). They play a big role in economic development and job creation. Admittedly though, not every MSME has its origin merely in the Nigerian entrepreneurial spirit, but also the shortage of employment opportunities at large firms may serve as an explanation for the prevalence of MSMEs in the country. A lack in access to finance is one of the most widespread obstacles for MSMEs. By issuing ringfenced loans to Nigerian banks for on-lending to MSMEs, development banks like DEG may be one part of the puzzle to solve the MSME financing gap. In any case, considering the various and complex economic challenges, Nigeria can absorb a bouquet of financial products. Funds may and must come from domestic and international investors and donors alike, priced at concessional and commercial rates, depending on whether they target private or public goods provision.
Every day I witness two worlds colliding right on my desk. The world of German banking regulation and the world of Nigerian agility, energy, and boldness. A touch of humor is undoubtedly a valuable ingredient for making the journey more enjoyable. Equally important are the ability to cut through complexity in a short period of time, as well as being results-oriented and relationship-focused.
My Bachelor of Science at Frankfurt School certainly provided a very good foundation to acquire and practice those very skills. It was also at Frankfurt School where I developed my passion for international working environments. Both my exchange semester in New Zealand and my internship in Chile have shown me that for me a multicultural working environment provides the most immediate opportunity to make sense of our world. As such, I apply discipline and intellectual curiosity to understand the complex economic, political, social and cultural challenges that shape my working environment, day by day.
“’O dabọ ,Yvonne’, it means ’goodbye, Yvonne’” says the security guard Adedayo, teaching me my first vocabulary in Yoruba upon my checkout from the hotel. “What does ’see you soon’ mean?” I ask him, knowing I will be back soon to visit this vivid city with its resilient, adaptable and therefore future-proof people. “ma a ri e laipe Nigeria”.
*names changed
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