Business opportunities in Nigeria may seem hard to uncover at first, but when taking a closer look, the country has a high business potential. Whether you are an entrepreneur looking to setup/expand in Nigeria or simply an investor, the country has the potential to provide significant return on investment.
Nigeria business overview
Population: 188.7 million
National currency: Nigerian Naira (₦)
Economic freedom score: 57.3 (ranked 111th worldwide)
GDP (PPP): $1.1 trillion
Growth (2018): +0.8%
Nigeria is one of the major players on the international trade scene. The West African country is the 49th largest exporter in the world, with a positive annual trade balance of $8.26 billion after deducting imports of $39.5 billion from its total exports of $47.8 billion (2018).
Nigeria’s top 5 commodity exports
- Crude petroleum – $36.9 billion
- Petroleum gas – $7.39 billion
- Refined petroleum – $603 million
- Cocoa beans – $504 million
- Rough wood – $333 million
Nigeria’s top 5 commodity imports
- Refined petroleum – $6 billion
- Wheat – $1.09 billion
- Raw sugar – $406 million
- Rice – $302 million
- Palm oil – $199 million
Top 5 business opportunities in Nigeria
We have compiled a list of the 5 best business opportunities in Nigeria. All these business opportunities are fast moving in Nigeria, and considered the ‘safest’ investments, with more than decent ROI.
1. Livestock farming and agriculture
Simply put – Africa holds around 65% of the whole world’s unused land. Added to the suitable climate of Nigeria, farming and agriculture is definitely a lucrative business. Africa’s agriculture business will be worth $1 trillion in less than a decade (un.org). It is good to note that currently, most of Nigeria’s livestock farming and agriculture business are based in rural areas, with low level of automation. With a proper investment in equipment and professional production line, getting in the farming and agriculture sector is a sure ‘win’.
2. Alternative power installation
Sadly, Nigeria is often considered as a ‘superpower with no power’. According to data from the WorldBank, only 54.4% of Nigerians have access to electricity. Power cuts are widespread across the country and the population relies heavily on diesel generators. Electricity supply per Nigerian has barely changed since 2005, while the population has rapidly by over 57 million meanwhile. Getting into the alternative power business in Nigeria would not only help the country, but also drive reliable revenue to whoever is investing. Moreover, since the current power cuts vastly hinder growth, the Nigerian authorities encourage projects aimed at providing reliable power to the country.
3. Logistics/haulage business
With the ever-growing number of business in Nigeria, the delivery business could be one of the most lucrative opportunities with low-end investment. Everyday, thousands of business haul their goods from one location to another. One way to get into this sector is by targeting big companies that need regular haulage of perishable goods, such as farms, breweries and agriproducts. This is a booming business in Nigeria, with more and more investors recognizing the need to fill the increasing demand for logistics and haulage.
For many years now, waste management has become a significant problem in Nigeria. The World Bank states that approximately 70% of waste produced in Africa ends up in a landfill or in water. As the population grows, waste management becomes even more problematic. Savvy organizations, such as Visionscape, are already banking on this sector – they offer a range of services aimed directly at tackling the waste management issue, such as waste collection, disposal and recycling.
5. Private schools
According to Caerus Capital, around 60 million African students will be enrolled in private schools by 2021. It is well known that the current educational system in Nigeria is facing a tough time providing quality education to its rapidly growing population. Low-cost private education is certainly one of the most profitable ventures one can set up in Nigeria. With more and more private schools emerging, the competition has improved the quality of education and school fees. Nigerian authorities also encourage foreign investment in the education sector, as they look to improve the literacy rate in the country.
3 Reasons to invest in Nigeria
- Nigeria is the largest economy in Africa. The country is the number one destination for Foreign Direct Investment in Africa.
- The population of Nigeria is set to overtake that of the United States by 2050. This means there is a huge potential market for almost any product.
- The Nigerian economy is growing at its fastest pace since a recession two years earlier. The local authorities have been heavily trying to attract and retain foreign investment.
How to get a head start in Nigeria
Let’s face it: running a business on the African continent is very challenging. With local laws getting amended frequently, it may look daunting to many entrepreneurs and investors to set foot in Nigeria.
However, Africa HR Solutions offers a full range of business services dedicated to organizations looking to get a footprint in Africa.
You can get a definite advantage over the competition by using our services.
- Simplest and fastest way in Nigeria to hire people without having a registered entity
- We manage the payroll and employment duties
- Single solution for all your HR requirements in Africa & a central point of contact for all your queries
- Always available for your queries and reports
- Full compliance with local legislation’s – expert across Africa
- Centralizing of payroll functions
- Team dedicated to quality and flexibility to meet your requirements
- Up to date statutory changes through multiple sources
- Professional indemnity and employer liability
As always, Africa HR Solutions guarantees 100% compliance for your business operations in Africa.