Written evidence submitted by British African Business Alliance Ltd. (IRN0026)
Terms of Reference.
Introduction to British African Business Alliance Ltd.
British African Business Alliance (BABA) is a network of Africa-facing business leaders in the UK; coming together to stimulate innovative investment, business partnerships, development projects and the creation of jobs. Developed by business leaders from Uganda Nigeria and UK, BABA started in 2009 and formalised in 2015 as a limited company. It has created networks across the UK and in London to serve the needs of its members.
In 2020, our members signed contracts and agreements worth over $250m and put in place funding to the tune of $230m creating new solutions, organisations, services and jobs across Africa.
In the UK, our work covers 4 core services:
We have developed Business Networks with African High Commissions and Embassies and we aim to bring together Diaspora Business Leaders, the UK Businesses working in those countries and International Investment and Finance.
Contribution to the Request for Evidence on Development in Nigeria
In the last 20 years, the Nigerian Economy grew 640% from $69.4bn (2000) to $448.1bn (2020), peaking at $568bn in 2014. The impact of the oil price crisis over the last 7 years has had a profound effect on the country and has stimulated a much belated diversification into other sectors. Although relatively slow, and constrained by lack of investment, it is also stimulated by the anti-corruption programmes that have been put in place by the current government. Yet, large amounts of cash remain uninvested in the economy and are largely held in low value savings and cash boxes.
The UK and its Relationships with Nigeria
The UK has a unique advantage and could develop an even more constructive relationship with Nigeria by applying its financial and commercial muscle to the development of Nigeria in a manner and style that not only impacts the destination country, but it also brings direct benefits to UK businesses and industries. Once applied to Nigeria this holds potential for application to development programmes in other countries.
The UK enjoys a multitude of relationships with Nigeria, most especially through the 2m (approx.) Nigerians living in the UK, many of whom are naturalised British, as well as those Nigerians here on visas. These qualified and proven relationships could be recognised as an asset to both countries and used as a foundation for an innovative programme of investment and development activities that will reach the grass roots of the Nigerian Economy and not just be allowed to filter down through the wealthy and the Government.
Diaspora Investment Potential
BABA estimates that around 500,000 of the Nigerians in UK have built up available assets through their work and life in UK of around £50,000. From our informal discussion and limited research, we believe that this collection of “rainy day” savings accounts, equity in UK Property and other low value investment activities, add up to around £25 billion, which could be invested into Nigeria, if the appropriate vehicles were to be found.
The history between the two countries is seen at an individual level as generally benevolent. Although, there are factions amongst Nigerians who recognise and react negatively to British activities during the formation of Nigeria and colonial period. The extractive nature of the original relationship is a particular focus. Alongside this, the recognised current need is to develop indigenous businesses and to retain processing profits, in country.
There is yearning for the practical benefits of “things that worked” in colonial times, so it is widely recognised that UK/British Engineering is done well and “worth it” – even if it is a little more expensive. Wise Nigerians also recognise that 60 years on, little blame can be placed at the UK’s door for projects, services and infrastructure that are now fallen into disrepair.
Trust and Confidence amongst Nigerians
One of the major issues in commercial development is a pervasive lack of trust between Nigerians, generally. A fear of being ripped off constrains commercial development and investment and there is recognition that the Government, Banks and even Best Friends can be relied on to exploit ideas brought forward to the detriment of the initiator of the business or the idea. The UK is uniquely place to help entrepreneurial Nigerians based here to access funding to be applied to the Nigerian Economy through schemes like a “Diaspora Enterprise Investment Scheme” that can sit alongside the UK’s existing EIS and SEIS schemes, used to stimulate investment in UK SMEs.
There is also a need for Nigeria to reduce imported ‘everyday’ goods and replace them with locally produced goods of similar quantity, saving “food and goods miles” and contributing to local job and wealth development.
The future, where Nigeria’s 200m population is set to double, overtaking the United States in size, in just 28 years, looks bleak. Unless growth can be stimulated in such a way that sustainable jobs are created, undeveloped land is put into good use for agriculture, processing and accommodation the pressures on the economy will increase significantly resulting in increased individual migration for economic survival.
The median age in Nigeria is currently around 18.2 years, less than half that of the UK, and is set to fall further as the population grows, making the need for knowledge, technology and skills transfers immediate and essential, if the well-being of the masses is not to deteriorate further.
British African Business Alliance recommends that the UK Government and its agencies leverage on the connections and capabilities of the Nigerian Diaspora based in the UK. By engaging this well-educated, well-positioned and well-connected community as guides, the UK can stimulate investment activities into viable businesses and development projects at multiple levels, especially the grass roots.
By working with Nigerians in the UK and empowering them to take steps themselves to invest in, develop and grow their own businesses in Nigeria, the UK Government would take the opportunity to optimise its investment into Nigeria. It would focus some of its resource into doing things that people want, but in a manner that adds value to what they are trying to do, already. The economy in Nigeria would see a growth in the SME sector, which is much needed. This is also likely to be the fastest way to create the largest number of jobs.
A by-product of this strategy is that the 0.5% of GDP invested by the UK in development will be supplemented by the co-funding individuals and companies bring to such activity.
At the same time, larger infrastructure projects, identified and brought forward with the Nigerian Government, could provide UK businesses with exceptional opportunities for growth. The private sector must come to the fore, leading such projects with world financial institutes standing behind them, to deliver services in Public Private Partnerships, but where the public engagement is through the Nigerian Government’s Provision of Land, Permits Licenses and a benevolent Legal Structure.
The critical point comes in recognising that it is not only in the developed world where Black Lives Matter, but it is also across the Continent of Africa, where better management, appropriate technology and appropriate funding could make a major difference to the well-being of the population of the continent.
It is a continent that requires a model development and the application of the best brains in the world.
British African Business Alliance Ltd, its members, networks and partners stand ready to work with the UK Government to bring forward such projects and opportunities as may be relevant.
British African Business Alliance Ltd
+44 7957 871 470