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West African Investment Landscape: Opportunities for Private Capital

RMBN held the fourth and final webinar in its Business and Economic conference. The session, moderated by Kemi Owonubi, Head Corporate Finance, RMBN, focused on the opportunities in the West African Investment Landscape and the opportunities available for private capital.
Michael Larbie CEO and MD, RMB Nigeria and West Africa stated that the RMBN Webinar sessions on the theme “Agility: Adapting in an Ever-Evolving Business World had provided insight, frameworks and toolkits that can be used to successfully navigate the post COVID-19 economic environment and beyond.

Neville Mandimika, Senior Research Analyst, RMB provided a macro-economic context to the discussion, leading with the unprecedented impact the COVID-19 pandemic has had on the global economy. He noted that the state in which businesses and economies entered the crisis would determine how they managed the crisis and emerged from it. In his review of West Africa, upcoming elections and ensuing political uncertainly was factor of concern including the contraction in economic growth brought upon by pandemic on economies that had previously shown promising growth trajectories such Ghana and Ivory Coast. He analyzed Ghana, Ivory Coast and Nigeria according to the factors of growth, fiscal strength and monetary room.

Read also: COVID-19: FCT minister tasks health professionals on synergy

Danladi Verheijen, Managing Director of Verod Capital Management spoke about Verod Capital’s investment focus which included financial services, consumer products & services and education in the region and how each market has been redefined to focus on the essentials. For example, with consumer products the focus was on non-discretionary products, and in financial services they were prioritising companies with digitized operations. Across board, there was a key focus on evaluating business performance and management teams to ensure investments are successful. He rounded off by saying that despite the difficult environment, the Nigerian consumer remained an attractive business opportunity for private capital.

Ben Dabrah, Chief Transformation Officer and Value Creation Partner, ACA, emphasized that pockets of opportunities remained across all sectors in the region some more affected by COVID-19 others less so. Their diversified portfolio balanced the winners in post COVID-19 environment such as healthcare, TMT, manufacturing, agribusiness (import substitution), TMT and FMCG with the more adversely impacted sectors such as entertainment, distribution and retail. He noted that COVID-19 had dramatically altered the West African landscape and concurred that growth drivers(consumer consumption growth, recovery in commodities prices and currency stability) had been impaired. However, the disruption of global supply chain provided a window of opportunity for import substitution companies (agribusiness) in which to position themselves to compete effectively when global trade re-opens. Private capital would invest in those companies who had advantage to build scale and to develop products. As such businesses needed to continuously innovate to outperform their peers and to be sustainable.

Fola Aiyesimoju, Group Managing Director, UAC Nigeria elaborated on the opportunities in the consumer sectors, emphasising that non-discretionary businesses such as animal feeds have performed better during COVID-19.
As a business, their focus was to survive and how to grow in spite of COVID-19 As such, critical strategy included inventory planning and supply chain development. On strategic decisions, where an investor feels there is a long-term advantage to develop a product in Nigeria, private capital should be deployed. He also noted that value addition in products, partnership between businesses and the government was central to markets regeneration post COVID-19

In closing, Ngover Ihyembe-Nwankwo, Head of Client Coverage, RMB Nigeria summarized the key themes discussed in the RMBN Webinar series by articulating the salient takeaways from the series. This being:
• The critical role technology plays as an enabler and differentiator, (Series 1);
• The opportunities to develop domestic markets on the back of the disruption in global supply chains in economies for example beneficiation in agriculture or in commodities (Series 2);
• The importance of risk management strategies to not only protect current capital invested but to attract new investors into Nigeria (Series 3); and
• The optimistic outlook for private capital in times of crisis having all risks considered (Series

In conclusion, Ngover reiterated the Bank’s DNA as Solutionists and that RMBN’s value proposition was to partner with its clients and stakeholders in enhancing their agility to adapt to the ever-evolving business environment.

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