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Nigeria’s smartphone sales grow despite naira fall — IDC

Nigeria’s smartphone sales grow despite naira fall — IDC

Smartphone sales in Nigeria grew in the fourth quarter of 2023 despite the naira’s steep decline, the International Data Corporation has disclosed.

The data insight firm revealed this in its IDC’s Worldwide Quarterly Mobile Phone Tracker, which showed that Africa’s smartphone market recorded shipments growth of 12.5 percent year-on-year (YoY) in Q4 2023 to 19.8 million units.

The performance of the smartphone market on the continent was due to customers’ focus on Chinese brands amid high inflation, local currency devaluations, and forex shortages. While smartphone sales grew, the African feature phone market saw a shipment decline of 7.8 percent to 20.9 million units.

“Nigeria overcame market volatility and a significant currency devaluation to record Africa’s second-highest growth rate thanks to a strong push by Chinese brands. South Africa recorded a YoY decline due to the challenging economic environment and partly due to delays in shipments at the country’s ports,” the firm said.

Due to their affordability, Transsion brands (Tecno, Itel, Infinix) continued to dominate Africa’s smartphone market. Samsung and Xiaomi followed in second and third place, respectively, IDC noted.

Other markets on the continent also fared well, and Kenya’s smartphone market recorded the highest YoY growth rate.

George Mbuthia, a senior research analyst at IDC, explained, “Kenya recorded the region’s highest YoY growth rate in terms of smartphone shipments in Q4 2023, coming from a low base when the market’s dominant brands reduced their shipments in Q4 2022 in an effort to manage high inventory levels.

“Local assembly initiatives for low-end smartphones (below $200) also contributed to the strong growth seen in Kenya. In addition, mobile phone financing schemes have enabled consumers to acquire new smartphones by enabling payment instalments over a long time period.”

IDC predicted that smartphone shipments in Africa would grow by 2.8 percent YoY in 2024, with the transition from feature phones supporting this.

Ramazan Yavuz, a senior research manager at IDC, added, “However, in Africa, the transition from feature phones will support smartphone growth in the short and medium term, while AI phones and 5G adoption will fuel Africa’s smartphone growth in the long term.”

A recent Canalys report revealed that demand for cheaper phones in Nigeria increased in the third quarter of 2023 as Infinix, Tecno, and Itel brands retained their position in the market. The naira has dipped by more than 40 percent since the Central Bank of Nigeria allowed its free float in the official market, which has spiked the cost of importing phones and other products.

Mr Ojikutu Adeniyi, the President of the Computer and Allied Products Dealers Association of Nigeria, told BusinessDay, “It has affected how distributors can import because people are not buying, as phones that were about N50,000 a while ago are now about N150,000.”