‘Nigerian businesses need better strategies to survive in S/Africa’

Inability to cope with the sophisticated nature of the South African economy, stringent regulatory frameworks and rigid labour laws are listed as probable reasons many Nigerian companies, which attempted to open in the former apartheid country could not survive, a South African business strategist has observed.

Hence, he called on the country to improve its business strategies as a matter of necessity to survive in competitive and strongly regulated markets in the continent.

While South African companies are doing well in Nigeria, there is no reciprocation leading to what many have described as imbalance.

Speaking with Nigerian journalists, who are on a media tour to South Africa through the second cohort of MTN Innovation Programme (MIP), in collaboration with the School of Media and Communications, Pan Atlantic University, the Programme Head, African Governance and Diplomacy, South African Institute of International Affairs, Steven Gruzd, noted that despite the readiness of the South African economy, it is worrisome that Nigerian firms are not evenly represented in the country.

Gruzd said owing to the sophistication of the South African coupled with stringent policies, some companies are not able to cope.

He said: “I think generally, it is not easy for anybody to do business in the country. I think there is a need to streamline some processes of issuing licences to businesses, having a one-stop shop where people get the information needed. South Africa is quite a sophisticated economy. So, the barriers to entry are more huge and difficult. I don’t think these are targeted against Nigeria alone; all foreigners face this challenge.

“South Africa does want massive investments, but labour laws are quite restrictive and there are reasons for that. Apartheid was a lot about controlling the labour market and abuse of workers. So, many actions need to be taken to block lapses in that regard. There is no anyhow firing and hiring of workers, the labour unions are very strong, where there are times for frequent strikes for better pay and the rest.”

He disclosed that MTN, Stanbic Bank, MultiChoice and the like are very big and important companies that have dedicated strong African strategies and expanded from South Africa having done well in the country of origin to other parts of the world.

“I think those companies are doing well because of hard work, tenacity, competition and generally, South Africa has to be more investor-friendly. Maybe, Nigeria and Nigerians would be well advised to have robust business strategies, taking into consideration local dynamics and conditions,” he stated.

While urging for a greater and more cordial relationship between the two leading economies of Africa, Grudz said it appears that lately, the relationship between South Africa and Nigeria has not been cordial the way it used to be.

He recalled that the last time Nigeria and South Africa enjoyed a very cordial relationship was when President Olusegun Obasanjo and President Thabo Mbeki were in power.

“These two people were friends before becoming presidents. That rubbed off on their leadership skills and styles, which paid off for both countries’ economies. But that cannot be said of now because of weak leadership. Nigeria, rather now focuses more internally than solving African problems,” he stated.

According to him, the continent hopes for a better working relationship between President Bola Tinubu of Nigeria and President Cyril Ramaphosa of South Africa, stressing that understanding between the two countries would do well for the continent.