• Sunday, February 25, 2024
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BusinessDay

‘Japa’ wave hits Nigeria’s investment banking industry

In recent years, Nigeria has witnessed a surge in a phenomenon colloquially known as “Japa Syndrome.” The term “Japa” derives from Nigerian slang, meaning to escape or flee, often to seek a perceived better life abroad. While migration is a natural part of human history, the scale and i

A disturbing development fast becoming a major concern for most companies in Nigeria has taken its toll on the investment banking and financial advisory industries as SBG Securities Research, a member of Standard Bank Group, issued a statement in its investor note that it will no longer be providing coverage on the analysis of sub-Saharan African food producers and beverages.

The financial advisory company’s statement is interpreted by some as indicating that the ‘Japa’ wave, depicting the significant emigration of Nigerians, has severely impacted their operations.

This impact could potentially harm not just their reputation but also their sustained presence within the country.

On the company’s X page (formerly known as Twitter), SBG Securities issued a disclaimer warning existing and prospective investors about its “termination of coverage” of certain companies in the sub-Saharan African food and beverage industry.

In essence, it said that as a result of staff movement out of the company, which seems significant, it will no longer be able to provide forecasts for some companies.

These companies are Dangote Sugar Refinery, Nestle Nigeria, Flour Mills Nigeria Plc, and Nascon Allied Industries. Others are Unilever Nigeria, International Breweries, Guinness Nigeria, Nigerian Breweries, East African Breweries, and Tanzania Breweries.

SBG Securities, however, added that all “forecasts should now be considered redundant.”

In a recent BusinessDay publication titled, “’Japa’ wave empties construction sites,” it was reported that the Nigerian construction industry faces a labour shortage due to skilled workers leaving the country.

Read also:‘Japa’ wave empties construction sites

In the report, BusinessDay said that the departure of skilled workers, which had been influenced by the current economic challenges in the country, impacts project timelines and costs, demanding government support and access to resources for the industry’s sustainability.

This public confession from SBG Securities exposes not only the mass exodus of Nigerians out of the country but also the dangers that it portends for the financial industry if highly skilled professionals continue this mass exodus out of the country.

Read also: From japa to sapa: Nigerians in a fix, struggle with life abroad

It also pushes the question of how the government can arrest brain drain in the country and, most importantly, try everything possible to improve the living conditions of Nigerians, which are at an all-time low.

There has been a substantial reaction on X regarding SBG Securities’ disclaimer, with some expressing concern over the mass emigration of Nigerians. Meanwhile, others have suggested that the company could use this situation as an opportunity to hire individuals with the necessary skill sets.

Rufybaba, an investment management and finance expert, expressed his surprise: “I didn’t understand how much of a problem the recent wave of brain drain was until I saw this some days ago. Like I knew it was existent, but after seeing this, I sighed.”

Shocked by this revelation, he added in a tweet, “I mean, if a whole Stanbic (a really premium employer in the Nigerian financial space and particularly the Nigerian capital market) is making this kind of decision, then I can imagine how terrible the situation is.”

However, Chenemi Abraham queried the financial company’s notice, tweeting, “Staff movement from where to where? Can’t they hire new staff? How many Nigerians are ever leaving the country? Do we have the stats?”

Others chimed in, underscoring the urgency for a solution to the perceived serious situation.