Business Groups in Nigeria
Learning from the evolution of Nigeria’s diversified private sector conglomerates
Nigeria suffers from low levels of industrialization and remains confounded by the dominance of extractives (oil and gas) and high levels of corruption. Only a few private companies, mainly commodity-based, diversified conglomerates, have reached a level close to their sector’s productivity and competitiveness frontier. This research aims to investigate how regime proximity and rent-seeking by the major diversified business groups has helped in their productivity dynamics.
This project in Nigeria maps the historical evolution, contemporary structure and productivity levels of key conglomerates. Based on the political settlements framework the project identifies the specific nature of state-business relations which allowed conglomerates to expand, diversify and maintain dominant positions in certain sectors. The overall contribution of the project is a detailed analysis of Nigeria’s key conglomerates based in the extractive and non-extractive sectors and the evaluation of how regime proximity was utilised by certain conglomerates to become productive. While some conglomerates have increased their industrial efficiency and continue to contribute to the overall goals of Nigerian industrial policy, others have stagnated over the years.
The delineation between productive and non-productive rents as used by the business sector in relation to different eras of Nigeria’s governance is therefore a key contribution of this project.
Pallavi Roy (SOAS) and Dr Farwa Sial (independent consultant).