A survey conducted by the American Business Council in collaboration with Accenture, KPMG, and PwC to assess the overall economic impact of US firms in Nigeria, has shown that the contribution of 74 US companies reinforce the role of the US play in Nigeria’s economy, in areas of job creation, investments training and development, tax, corporate social responsibility (CSR), agriculture, amongst others. The survey sampled over 100 US companies operating in Nigeria.
The survey result made available to Nairametrics, suggests that though ease of doing business in Nigeria has improved, businesses still face dire challenges. Inspite of the challenges, US companies operating in Nigeria have showed renewed focus, committed in human capacity as well as financial investment.
The survey shows:
- The surveyed US companies generated revenue of over N2 trillion in 2017.
- The total tax contribution of the surveyed companies is over N111 billion.
- Approximately 11,200 indirect jobs and over 9,000 full time jobs were created by the survey participants in Nigeria in 2017. This represents a 72% and 70% growth respectively from 2016.
- FDI inflows in 2017 from the US into Nigeria is estimated to $1 billion.
- The surveyed companies spent over N1.6 billion on training and development in 2017 from N340 million in 2016. This shows US companies commitment in capacity building in order to correct the deficit in labour skills.
- Corporate social responsibility (CSR) is a key area of focus for US companies in Nigeria. In 2017, the surveyed companies spent over N1.5 Billion on CSR from N217 million in 2016. The focus areas are Education, Health, Infrastructure and Social intervention.
- About 52% of these companies identified Nigeria as a regional hub for their operations in West Africa.
- The survey showed that 64% of US companies have a local content target reflecting an inclination towards localisation in areas such as products, people and supply chain.
- The critical issues that impact the business operations of surveyed US companies in Nigeria today include: Labour – training of university graduates and union issues less likely but prevalent in few sectors; specific industry regulations; local content – local players in various sectors may not reach the quality and compliance standards of these companies; and crime and security – Security of lives as well as Intellectual Property has been a crucial issue for US companies as this impacts investment and derails trust.
The council said alot of US companies are in the field of agriculture and in the next 10 years they want to focus more on agriculture and hope Nigeria becomes an agricultural champion.
On the private sector, the council hope to deepen the economy through private sector partnership. ABC is currently having private sector conversation; the is promoting the SheTrade initiative.
The SheTrade initiative was launched by the International Trade Centre (ITC) to create an ecosystem of integrated solutions that empower women economically through trade.
This is a clear indication that US businesses are committed to contributing to the Nigerian economy by uplifting its people, increasing investment in Nigeria and facilitating trade.
About the survey
The 2018 survey highlights “the numbers of US companies that are currently operating in Nigeria, the cumulative direct investment committed by this companies, revenue generated through tax paid to the Government, trainings provided to staff, local content initiatives and how they have provided employment opportunities to Nigeria, and boost the macro and micro economics dynamics of the country.
About American Business Council (ABC)
The American Business Council is the voice of American business in Nigeria and has become a powerful advocacy instrument with the Nigerian public and private sectors.
Incorporated in February 2007 and a key vehicle for expanding trade investment opportunities between Nigeria and the US in the interest of its member – companies and both countries.
The Council is the American Chamber of Commerce in Nigeria and supports sustainable socio-economic reforms through collaborative engagements with the government and other stakeholders including the Nigerian Economic Summit Group and the Nigerian – American Chamber of Commerce.
The American Business Council Ltd/Gte, is an affiliate of the US Chamber of Commerce. The Board of Directors include CEOs of Blue -Chip US Companies, US Ambassador as well as representatives of the Commercial and Economic Division of the US Mission.
The American Business Council is an integral stakeholder in the Commercial Investment Dialogue which is intended to deepen trade investment ties between the U.S. and Nigeria as well as designed to foster sustained engagement between governments on concrete issues of importance to the private sector.
Among other recent activities, the Council has organized strategic discussions with Nigeria’s Economic Team, all of whom have sought ABC’s feedback and input on major policy decisions. One of which is the Ease of Doing Business report presented to the Minister for Industry Trade and Investment, Dr Okechukwu Enelemah. The report is an outcome of a Business Workshop an open forum with technical experts from the Manufacturing, SME, ICT, Energy, Agriculture, Real Estate, Courier and HealthCare.
The Council has also mobilized multi-stakeholder groups to engage regulatory agencies and resolve critical challenges for member companies.
The US is a natural business partner for Nigeria and one with a long- standing commitment to the country. Some American Companies have been in existence, partnered and invested in Nigeria since Independence.