20 July 2014

Zimbabwe: Are Nigerians More Entrepreneurial Than Zimbabweans?

analysis

You don't learn to walk by following rules. You learn by doing and falling over. --Richard Branson.

In 2003, a friend and former schoolmate of mine, Tonde, decided to go to the United Kingdom. He managed to pass through the dreaded immigration screening process, which those days was seeing dozens of Zimbabweans deported daily without even setting foot outside the airport perimeter. Fortunately for Tonde, a cousin helped him to secure a job in a medical facility and today he is still there and is doing alright with his small family.

At that time, I was staying in a flat in Bulawayo. There was one neighbour whom I rarely saw except on Sundays. The gentleman was Nigerian and rumour had it that he was into some shady dealings and that is why he was rarely seen in the neighbourhood.

One day, though, we met and started talking. It was when the conversation turned to cars when he told me that he actually owned a motor vehicle spares shop in town. That is where he spent most of his time because business was brisk.

When I picked up a recent copy of the Economist magazine these two guys came to mind. The article that intrigued me was entitled, How Nigeria overtook South Africa to become Africa's biggest economy.

Apparently Nigeria had been overlooking some rapidly growing

contributors to its economy, such as telecommunications, banking and the popular Nollywood film industry. After rebasing its GDP to take the contributions of these sectors into account, something which most countries do every five to 10 years, Nigeria grew its GDP by 89% to become the largest economy in Africa and the 26th largest in the world.

Although Nigeria is rich in oil and natural gas, these resources apparently play no more than a small role in the country's development. Manufacturing, industry and banking are fast growing, fuelled by foreign direct investments by Nigerians abroad.

US$21billon was remitted by Nigerians in the Diaspora in 2013, most of which went into building new businesses and expanding existing ones.

Apart from these industries, Nigeria has the largest agricultural output in Africa, and it is ranked sixth in the world. After some years of neglect as the country focused on the income from oil and gas, agriculture now contributes 26,8% to Nigerian GDP, employing two thirds of the population.

In 2011, Nigeria was included in the 3G, a group of eleven countries that has been identified as sources of growth potential and investment opportunities, according to a Citigroup report.

The 3G, which stands for Growth Generator Group, is widely seen as replacing the BRICS (Brazil, Russia, India, China and South Africa) that are seen as having outlived their usefulness as emerging markets and growth drivers. (China and India remain in the new group, joined by Egypt, Bangladesh, Indonesia, Iraq, Mongolia, Philippines, Vietnam and Sri Lanka).

What is fuelling Nigeria's growth? Is it because its citizens, when forced by economic difficulties to go abroad, do not seek jobs but start their own businesses? As business builders, I am sure there can afford to send more money home than average paid Zimbabweans in the Diaspora.

The thought came to my mind that maybe Nigerians remit more money back home because they are generally more of them, in terms of numbers, than Zimbabweans abroad. Well, let the figures speak for themselves.

Yes Nigeria has a much bigger population, 174 million compared to Zimbabwe's 13,1 million in 2013: a ratio of 1:13. Populations in the Diaspora are estimated at 3,3 million of Zimbabweans and 17 million Nigerians, a ratio of one Zimbabwean for every five Nigerians.

However, the remittances in 2013 were US$764 million to Zimbabwe, US$21 billion to Nigeria, a massive difference of 27,5 to one in favour of Nigeria. In individual terms on average, a Zimbabwean abroad remitted home US$231 in 2013, while a Nigerian sent US$1 235.

Just look at the Nigerians living in Zimbabwe. How many are working for a Zimbabwean company? How many are running their own businesses and employing Zimbabweans?

When defining entrepreneurship, economist Robert Cantillon (1680-1734) considered the entrepreneur to be a risk taker who deliberately allocates resources to exploit opportunities in order to maximise the financial return. The entrepreneur is therefore not satisfied with ordinary, low return activities.

When we talk of entrepreneurs we are not talking of those people forced into informal business activities because of lack of jobs. Instead, we are talking of innovators, people who create new things and who use their imagination to find opportunities, which are there everywhere.

Entrepreneurs tend to be risk takers; not careless or irresponsible daredevils, but takers of calculated and manageable risks.

Their success lies in caution, learning, flexibility and being able to change at short notice. Successful entrepreneurs have dared to leave their comfort zones to build something, without any guarantee except their belief that they will make it.

So what do you think: Are we less entrepreneurial than Nigerians?

Phillip Chichoni is a business development consultant who works with SMEs and entrepreneurs. You may contact him by email, chichonip@smebusinesslink.com. You can also visit http://smebusinesslink.com

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