Investment Plan: As Nigeria slides into worst recession in over 30 years….Elempe Deleadmin
Investment Plan: As Nigeria slides into worst recession in over 30 years….Elempe Dele
Nigeria has officially slid into its worst economic recession in over 30 years. Gross Domestic Products (GDP) figures released by the National Bureau of Statistics on Saturday, show that the country recorded a contraction of 3.62 percent in the third quarter of 2020.
This is not unexpected as we had already been foretold by pundits that this will be our fate under Buhari. Was this not what happened when he was the Head of State in the 80s? So it’s all about history repeating itself. It is just unfortunate that historics failed to adhere to the warnings.
I know we are yet to see a large population of Nigerians thumping food from waste-bins to convince us beyond their rethorics that things are getting worse than they were ever.
Now, we must not fret or whimper over this expected or unexpected situation of things. We must be sane enough to think on a ways forward.
As an investor, or aspiring one, since most people will now depend largely on other sources of income to complement what they used to earn, we must start looking at the best ways to invest or the best sectors to invest.
The areas of investment this moment of reccesion with high yielding returns are food production( basically the Added Value Chain), Pharmaceuticals, Education, Information and Communication Technology, ICT and Alternative Energy Production. (This list is not necessary in this order for investment, but for me, I favour food production because it is placed in the highest priority among others in the list)
No matter how bad this economy will become, the citizens must eat food, and if there is enough left, they will be exported. So there will always be demand for food. From my own projection, food will be very very expensive next year. The reason for my projection is based on the weather change this year. The rains did not fall as much as farmers that depend on it would have expected. So most crops did not do well. (And it has since stopped raining. The sun is high and if it continues like this, a lot of late crops will die in farms without irrigation) So the production of food was basically scanty before the rains stopped. As we speak, the cost of food is almost going to the outer space – from ‘ordinary’ onions, red oil, Garri, yams, to rice…So it is pertinent to think of a section in the Food Added Value Chain to invest because the growing population must eat. Yes, they can forfeit other things like high end ostetenous goods – shoes, accessories, clothes, perfumes, cars…but they can’t discount food from the list in their expenses – for everyone; rich or poor, it is a priority. It is a constant that must be purchased at whatever cost. As I write now, rice is climbing to #40,000 per bag, onions is #100 for the smallest ones while red oil goes for #17,000(25kg) as against #7,500(25kg) it was four months ago. Even Garri that used to be food for commoners is legally pursuing rice in price.
So I think a smart investor or intended investor will explore this opportunity to see which particular area he can put his money to get back optimum profit or good return on investment.