Nigeria’s Most Important Export | by Nkiruka Chiemelu

“Nigeria has inadvertently landed itself a new title – it has become the largest manufacturer and exporter of culture in Africa.”

Director Bond Emeruwa and crew shoot a scene in 2007 documentary 'This is Nollywood'
Director Bond Emeruwa and crew shoot a scene in 2007 documentary ‘This is Nollywood’

There has, in recent times, been plenty of focus on the increased diversification of the Nigerian economy led by its growing consumer class. Yet, the macroeconomic shocks to the country as a result of low oil prices are a clear indicator that Nigeria is nowhere near as diversified as it would have seemed even a few years ago. Despite the spotlight that is kept on more traditional forms of economic diversification, it is possible that the Nigerian government is missing a trick by its neglect of the country’s entertainment industries.

Through its cultural dominance in Africa, Nigeria has not only become the largest exporter of culture in Africa but one of the largest exporters of ‘black culture’ to the world.

There is no question that Nigeria is in urgent need of increased overall investment and specifically, investment into the non-extractive industries. The hope is that a rising consumer class can help buoy the struggling economy as it attempts to find its place in what appears to be the new normal of a less oil-dependent world.  However, the conventional forms of economic development need no longer apply.

In an age of the World Trade Organization and supranational corporations, the old ways of development through strong state-directed industrial policy are no longer possible. That is, of course, unless you are China. Furthermore, Nigeria is already transitioning from a commodity-based economy to a service-based economy, and appears to have entirely skipped over the traditional stage of industrialised manufacturing. Add to that, the flow of low-cost Chinese goods into the country, which cannot be beaten on price and scale by local manufacturers. The result is an affordable cost of living for Nigeria’s growing consumer class alongside diminished opportunities for local employment. Competition, as well the growth of small and medium enterprises (SMEs) are also stifled in the process; setting Nigeria up for economic stagnation.

Nigeria must find a new and innovative way to employ the millions of young people that enter into its labour force every year.  According to the United Nations Population Fund (UNFPA), Nigeria’s population is expected to reach 400 million by 2050.  As Africa’s most populous country, with its largest consumer market, Nigeria serves as a prime market for consumer growth. Importantly, the new consumer class is not just spending money but it is increasingly spending money in Nigeria on Nigerian products and services.  Instead of following the old route and simply leaving for Europe and North America, many middle-class Nigerians are bringing their ideas to Nigeria and promoting modern African culture in a way that is uniquely Nigerian.

the combined revenue from motion pictures, sound recording and music production from 2010 to 2013 stood at more than N2.3 billion

Nigeria has inadvertently landed itself a new title – it has become the largest manufacturer and exporter of culture in Africa. The market for Nigerian music, film and other forms of entertainment is widespread across the continent. This offers unique opportunities as well as the challenge to see if it is possible for Nigeria to consciously commodify its culture as a form of profitable export.

The key word is ‘conscious’. Presently, it would be a gross falsehood to imply that the rise of the Nigerian cultural entertainment industry as a distinct part of the country’s economy has been anything but accidental. On the part of the government, there has been no strategy or design. This state of affairs is troubling because targeted investment in Nigeria’s entertainment sector would not only bolster the industry but would be of great benefit to country’s economy as a whole.

The explosive rise of the Nollywood industry and its takeover and absorption across Africa, as well as in the diaspora, has shown that there is a large market for a broad Nigerian culture. Economically beneficial is the fact that entertainment is recession proof and has the ability to thrive during periods of economic turbulence. Unlike many industries, consumers are willing to spend on entertainment even when there is little cash in their pockets.

According to the United Nations Population Fund (UNFPA), Nigeria’s population is expected to reach 400 million by 2050.

Through its cultural dominance in Africa, Nigeria has not only become the largest exporter of culture in Africa but one of the largest exporters of ‘black culture’ to the world. The vision of Africa that Nigeria exports through its television, film, and music offers a contrast to the version of ‘black culture’ presented by the United States – arguably the world’s largest exporter of that substance.

As Africa has grown, so has the appetite for Nigerian culture. Following the World Bank’s 2014 rebasing of the Nigerian economy, the combined revenue from motion pictures, sound recording and music production from 2010 to 2013 stood at more than N2.3 billion; with the film industry becoming the second largest employer in Nigeria. The music industry alone, which includes revenues from mobile ringtone sales, song downloads, live performances and album recordings is expected to reach close to half a billion naira this year.

the new consumer class is not just spending money but it is increasingly spending money in Nigeria on Nigerian products and services.

The numbers speak for themselves: Nigerian culture can make Nigerians money. The only question that remains is what role can the government play in commodifying a broad Nigerian culture as a path to economic development? The private sector will be crucial. The implications of government-funded music, television, or film may tend to deter honest innovation.

Although, there have been examples of government support for the entertainment industry – President Goodluck Jonathan’s Entertainment Industry Intervention Fund springs to mind – these were poorly executed failures. Yet, there are key areas where it makes sense for the government to help; especially if policy interventions can be effectively implemented. The area of intellectual property rights is a prime example.

Copyright and anti-piracy laws in Nigeria are weakly enforced, and as the popularity for Nigerian films and music grows, so also does piracy. A briefing by the United States International Trade Commission noted that piracy has, so far, resulted in a loss of more than $1 billion annually in potential revenue.  Weak property protections also deter higher rates of investment into film and music due to higher risks of return.

The Nigerian Copyright Commission (NCC), the main government agency responsible for all issues of copyright in Nigeria, functions within a byzantine network of other agencies and offshoots that have overlapping responsibilities and unclear priorities. In response to the outcry about the lack of protections from creators of content, producers, and distributors within the entertainment sector, the NCC has increased its effort to combat piracy by going after illegal distributors and through the use of awareness raising programmes about piracy.

Perhaps the most important role the government can play is to provide the sector with basic protections and then get out of the way.

Additionally in 2013, the Copyright Society of Nigeria (COSON), in collaboration with the Nigerian music industry, organized the first ever summit focused on digital music licensing and adapting to digital trends.  In April 2016, COSON took another step in making Nigeria’s music industry more professional by moving to increase protections on public performances and other sound recordings in Nigeria to ensure proper compensation for recording artists and their companies.

The growing use of formalised legal practices and enforcement mechanisms for revenue collection and intellectual property rights protection suggests that government agencies are beginning to recognise the need for further intervention to safeguard the progress made by the Nigerian entertainment industry. This can only help to ensure that private enterprise can continue to flourish and remain profitable.

However, current efforts must be intensified in order to see the entertainment industry reach its full potential. An increase of a mere 10% in captured revenue that would otherwise have been lost to piracy would bring in another N115 billion for the industry annually. The government must take the lead in creating stronger enforcement mechanisms to combat piracy through the prosecution of illegal distributors and by empowering the judicial system to bring more intellectual property rights infringement cases to trial and resolution.

For the past 20 years, Nigeria has led the way as the cultural vanguard for black Africa through a self-reliant and innovative industry that has grown into a major revenue generator for the country. As a result, brand ‘Nigeria’ has become a strong one on the continent and it is shaping social cultural norms and views for, and of, Africans in Africa as well as those in the diaspora.

The success of Nigerian music and film has inspired similar movements across Africa. Whether the Nigerian industries are able to maintain their cultural relevance and market share will depend on if the government is willing to formalise its own systems of enforcement in order to bring cohesion and order to the industry and start taking entertainment more seriously.  Perhaps the most important role the government can play is to provide the sector with basic protections and then get out of the way.

Nkiruka Chiemelu is the Programme Manager for Africa at the United Nations Global Compact, a corporate sustainability initiative that advocates guidance and policies for the private sector to respect and support human rights, labour, the environment, and anti-corruption. She is from Enugu State, Nigeria.

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