By Jeph Ajobaju, Chief Copy Editor
Lagos with its business acumen has eight times the wealth of Abuja the civil service town, yet Lagos has lost 1,800 millionaires in dollars and its wealth shrunk 27 per cent in the past four years, according to Africa Wealth Report (AWR).
There are currently two billionaires in dollars living in Lagos. None in Abuja.
However, Nigeria’s centre of excellence ranks the fourth wealthiest city on the continent, trailing behind Johannesburg, Cape Town, and Cairo.
The 2021 AWR released by the AfrAsia Bank and the New World Wealth (NWW) estimates the wealth of Johannesburg at $226 billion and that of Lagos at $88 billion.
Meaning, the wealth gap between Johannesburg and Lagos is a huge $138 billion.
According to the AWR, quoted by TheCable, Lagos lost two billionaires in dollars, 100 multi-millionaires, and 1,800 millionaires between 2017 and early 2021.
The report, produced by a global market research group in Johannesburg, defines total wealth as the private wealth held by individuals living in a city.
This includes all assets – property, cash, equities, business interests – less any liabilities, and excluding government funds.
Lagos has maintained the fourth position from 2017 to date, with Johannesburg keeping its rank as the wealthiest city in Africa.
In the 2017 report, the total wealth of Lagos stood at $120 billion. It reduced to $108 billion in 2018 and went lower in 2019 to $96 billion.
By 2020, Lagos was still ranked fourth in Africa, but its wealth dropped to $88 billion.
2021 Africa’s top 10 richest cities
Johannesburg ($226 billion)
Cape Town ($123 billion)
Cairo ($118 billion)
Lagos ($88 billion)
Durban ($55 billion)
Nairobi ($47 billion)
Paarl, Franschhoek & Stellenbosch ($47 billion)
Pretoria ($42 billion)
Casablanca ($39 billion)
Accra ($34 billion)
Abuja has no billionaires
According to the report, Abuja is the 19th richest city in Africa with an estimated wealth of $10 billion. This means Lagos has more than eight times the wealth of Nigeria’s capital.
Abuja has 40 multi-millionaires in dollars and 600 millionaires with no billionaires.
There was a reduction in the number of billionaires, multi-millionaires and millionaires in Lagos.
In 2017, four billionaires in dollars lived in Lagos, along with 360 multi-millionaires and 6,800 millionaires.
In 2021, the city has only two billionaires in dollars, 260 multi-millionaires, and 5,000 millionaires, the report said.
Lagos attracts $27b investment
In Nigeria, however, Lagos remains preeminent in wealth and prestige, disclosing in May that it garnered $26.07 billion investment in the past two years alone, flaunting its ability to attract, retain, and leverage growth that makes it the fifth largest economy in Africa.
Lagos received 74 per cent of total foreign investment in Nigeria in 2019 and 86 per cent in 2020, said Solape Hammond, Sustainable Development Goals and Investment Adviser to Governor Babajide Sanwo-Olu.
However, data released by the Nigerian Investment Promotion Commission (NIPC) for Q1 2021 shows that Bayelsa received the largest share of investment with $3.6 billion in mining and quarrying.
Delta came second with $2.94 billion in seaport construction and power transmission, followed by Akwa Ibom with $1.4 billion announced in mining and quarrying.
Lagos ranked fourth with $0.26 billion in finance, insurance, and manufacturing.
The leading four destinations accounted for 97 per cent of total investments announced in Q1 2021 against 56 per cent in Q1 2020.
Lagos to improve business climate
A breakdown of the $26.07 billion investment Lagos attracted shows that $17.75 billion landed in 2019, which represented 74 per cent of total capital inflows into the country, and $8.32 billion in 2020 (86 per cent).
Hammond said the economic policy of the state government is designed to improve the business climate of Lagos and promote socio-economic prosperity.
Alausa, through the Office of Sustainable Development Goals and Investment (OSDGI), has in the past two years participated in several global campaigns to attract investments and partnerships for projects related to the Sustainable Development Goals of the United Nations, she added.
Hammond confirmed that Lagos is engaging local and international organisations for investment possibilities and has supported more than 12 private sector investors interested in the state.
Her words: “Other strategies and efforts undertaken to promote sustainable investment in Lagos include the strategic partnerships with development agencies comprising the International Finance Corporation (IFC), Africa Development Bank (AfDB), World Bank and the French Development Agency (AFD).’’
The OSDGI plans a “One-Stop-Shop” to improve the ease of doing business for investors and also facilitate the process of granting approval for lands, buildings, and taxes by all agencies involved in business startups.
Hammond disclosed that the OSDGI, in collaboration with the UN Development Programme (UNDP), launched the Conditional Cash Transfer Project in vulnerable communities to provide resilience, livelihood, and short term employment.
More than 2,103 Medium-Sized and Small-Scale Enterprise (MSME) owners have received ‘Unconditional Cash Transfer’ and 951 people were paid ‘Cash for Work’ to carry out environmental sanitation and hygiene for three months, according to her.
Investments nationwide
Overall investments in Nigeria’s economy rose 75 per cent from $4.81 billion in Q1 2020 to $8.41 billion in Q1 2021, according to the NIPC.
This shows an increase of 8.38 per cent compared to investments in Q4 2020 which stood at $7.76 billion.
Top four sectors
The top four investment sectors in Q1 2021 were real estate, power, manufacturing, and agriculture which received a total $8.35 billion worth of investments.
Back in Q1 2020, transportation had topped the list with 42 per cent of total investments, followed by information and communication (33 per cent), mining and quarrying (21 per cent), and agriculture (4 per cent).
But in Q1 2021, manufacturing received 60 per cent of total investments ($5.08 billion), trailed by construction ($2.90 billion), electricity ($0.26 billion), and agriculture ($0.11 billion).
Major investors
The federal government was the major source of investments in Q1 2021, accounting for 35 per cent ($2.95 billion), unlike Q1 2020 when the United States led with 42 per cent of investment announcements in Nigeria.
In Q1 2021, South Africa accounted for 33 per cent, domestic investors (16 per cent), Morocco ($1.40 billion), the United Kingdom ($0.24 billion), and the US ($0.08 billion).
In Q1 2020, Nigeria received 15 projects across eight states but in Q1 2021 the number rose to 19 projects in 14 states including the Federal Capital Territory (FCT).
The NIPC had disclosed in February that total collated investment announcements for 2020 amounted to $16.74 billion, down from $29.91 billion in 2019.
Total announcements for 2020 involved 63 projects in 21 states and the FCT. Lagos led the pack with 24 projects, the NIPC said.
It attributed the surge in investments in Q1 2021 to the gradual return of investors’ confidence globally after a decline forced by the pandemic.