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Why Twitter, other investors prefer Ghana to Nigeria

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LAST week, the Internet was agog following an announcement by Twitter that it had concluded plans to site its Africa headquarters in Ghana.

Twitter Founder Jack Dorsey, who announced this in a statement, said the company chose Ghana because the country was a supporter of free speech, online freedom, and the open internet, which the platform was also an advocate for.

It further cited that Ghana’s recent appointment as host of the Secretariat of the African Continental Free Trade Area(AfCFTA) aligned with Twitter’s overarching goal to establish a presence in the African region.

Twitter also said it had already laid foundations through partnerships with Amref Health Africa in Kenya, Afrochella in Ghana, Mentally Aware Nigeria Initiative (MANI) in Nigeria, and The HackLab Foundation in Ghana.

Although the news was received with mixed feelings by Nigerians who accounted for the larger percentage of its usage in Africa, the Nigerian government has blamed ‘unpatriotic, judgemental Nigerians’ for the move.

Minister of Information Lai Mohammed claimed those demarketing Nigeria and projecting her negatively were to blame for Twitter’s decision.

The minister, who has a penchant for trading blames, noted that this decision would teach Nigerians to be fair and patriotic while criticising the country on social media platforms.

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According to him, Nigeria had lost job opportunities and the visibility that would have been got if Twitter had chosen the country.

Why won’t it be Ghana?

The country’s social space, which should operate on the principle of freedom of speech, is currently being gagged by the Muhammadu Buhari-led administration through various proposed legislations and unfair sanctions on media houses.  There is an Anti-Social Media Bill, including  the Hate Speech Bill which appropriates death sentence to individuals abusing their freedom of speech.

Apart from that, the World Bank Group, in its 2020 Doing Business Report, ranked Nigeria 131 out of 190 countries on the ease of doing business index, an upward movement by 15 places from 2019 ranking of 146. Ghana was ranked at 118.  The index shows how much nations make progress in key areas that aid investments. In the index, 118 is better than 131.

Nigeria improved in eight indicators, with the greatest overall positive movement being on dealing with construction permits. Africa’s biggest economy moved from 149 to 55 within a year, indicating that it is now easier to obtain necessary licenses and permits in Nigeria than in 135 countries. The significantly improved ranking in dealing with construction permits might be attributed to the elimination of the Infrastructure Development Charge (IDC – the fee for construction permits) for warehouses and factories.

However, Ghana bettered Nigeria on many indicators. The West African country was ranked at 79 in terms of access to electricity and power supply, while its populous neighbour,  characterised with constant epileptic supply of power, ranked 169.

Niyi Adebayo, Minister of Industry, Trade and Investment
Niyi Adebayo, Minister of Industry, Trade and Investment
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Nigeria generates around 12,522 megawatts (MW) of electricity but distributes about 4,000MW.  This means one megawatt is to 50,000 population. On the other hand, Ghana generates 4,000MW and distributes 2,400MW, according to the USAID. This is one MW to 12,675 population. However,  while “Nigeria’s new gas-fired capacity is unused because of gas supply problems, Ghana has not been able to absorb all of its new installed capacity,” according to Neil Ford of African Business.

Manufacturers and businesses in Nigeria are hard hit with energy problems. Many manufacturers generate their own power, ignoring electricity distribution companies (DisCos).  They self-generate 13,233 MW, according to a survey undertaken by  Economics Professor  at the University of Ibadan Adeola Adenikinju, which was funded by the European Union and the government of Germany.

“Average daily power outage has constantly averaged four times per day,” the Manufacturers Association of Nigeria (MAN) said on its 2020 Second Half Economic Review.

READ ALSOWhy Twitter established African office in Ghana and not Nigeria   

Nigeria moved to 183 in terms of business and property registrations as against 111 of Ghana.

Nigeria recorded downward movements on the ease of paying taxes to 159 as against Ghana’s 152. This is despite the introduction and implementation of the Integrated Tax Administration System (ITAS) which was and is still expected to simplify the process of filing and paying taxes.  Multiple taxation is still common in Nigeria, said Lagos Chamber of Commerce and Industry (LCCI).

Nigeria also  experiences security crisis ranging from herder-farmer clashes, kidnappings, to abductions and terrorism.

“Rising spate of insecurity portrays the economy as an unsafe investment destination, and if unaddressed, would continue to undermine government’s efforts in encouraging private investment inflows into the economy,” LCCI President Toki Mabogunje said in a statement sent to The ICIR on April 14.

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“We cannot afford to continue this way as a country. We need to fix this security problem urgently and at all costs,” she further said.

Ghana recorded total foreign direct investments (FDI) value of $785.62 million in the first half of 2020. On the other hand, Nigeria attracted $362.84 million in FDI within the same period.

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