The vastly reported news of Wal-Mart’s
plan to branch into Nigeria -Africa’s largest economy -through the
country’s commercial hub of Lagos is a game changer for all actors in
Nigeria’s retail landscape. But beyond the obvious, the reception
accorded to Wal-Mart and the support that has been pledged to it are
typical of Africa’s race to the bottom in the search for foreign direct
investments. Wal-Mart would naturally revel in the over-advertised trump
card of the transnational corporate establishment as a mega employment
generator. African governments have been known to not interrogate or
scrutinise these assurances, which they habitually over-compensate often
to the detriment of the national interest. And foreign direct investors
expectedly play the script well since they are regularly courted across
the continent in a zero sum competition game. It is simple: “If you do
not make it ‘conducive’ for us to invest in your country, we will go
elsewhere. After all, we are in a globalised economy.”
But
a more constructive engagement is necessary for Nigeria and
particularly Lagos in this case. If not for anything, for the very
obvious – Nigeria has a distinctive factor endowment as Africa’s largest
economy and its significant market with arguably the continent’s
largest skilled middle class. Wal-Mart comes with a reputation, negative
and not-so-negative. On the face of it, the Wal-Mart brand has
incredible value chain development potential in the context of Lagos and
Nigeria. But Wal-Mart does not have an enviable profile with regard to
its dealings with desk-end employees it habitually confines to minimum
wage, with the unwritten argument that such jobs are not for life. That
is the reason Wal-Mart remains the contemporary global face of the
historic tension between capital and labour.
In a country where the labour laws exist
mainly on the books, could Wal-Mart exploit Nigeria’s situation or rise
to the challenge of corporate responsibility and international best
practices? The argument of job creation reminds one of the same case by
transnational agricultural corporations that grab vast agricultural land
across the African continent. As soon as they displace subsistent
farmers from their ancestral lands, the only jobs created are those for a
handful uniform-wearing, walkie-talkie-clutching security men, a few
tractor drivers and hordes of cleaners, chauffeurs and domestic aides.
The ceding governments often have no plan for absorbing the displaced
informal agricultural communities, especially women.
Yet, it is possible to engage Wal-Mart
and similar travellers on the FDI highway. In specific regard to
Wal-Mart, Nigeria’s nook and cranny can serve as viable supply chain for
its wares in contrast to the retail giant’s excessive dependence on
China-made goods. Looking inwards is a win-win that will ultimately, if
indirectly, support qualitative employment and local entrepreneurship.
Beyond allotting Wal-Mart privileged real estate in Lagos and other
urban centres, in addition to extrajuicy inducements of the FDI,
governments should insist upon qualitative quid pro quo through creative
expatriate quota laws and indigenous-friendly regulatory regime. They
should demand from Wal-Mart and its ilk their strategy for developing
and grounding their supply chain within the host country. From Oron,
Amazano, Elele, Ntigha, Umunede, Ijebu Igbo, Ota, Ikire, Effon-Alaiye,
Iseyin, Kafanchan and Malunfasi to all parts of Nigeria’s hinterlands,
there is youthful energy for agriculture and various aspects of local
entrepreneurship to key into Wal-Mart’s supply and value chain. Those
have greater economic ramification for Nigeria than Wal-Mart’s addiction
to China as the supplier of its wares. With its global network and
expertise, Wal-Mart would be in the position to bridge the stubborn gap
in packaging, movement and preservation of goods from Nigeria’s
hinterlands to its cosmopolitan centres.
Within that confluence of manufacturing,
distribution and retail, Wal-Mart can creatively be a catalyst for
authentic and empowering job creation in Nigeria. But that will not be
the case if all it has to offer are T-shirts from Indonesia or India,
belts and handbags from China, apples from Annapolis Valley, bananas
from Dominican Republic, pistachios from California, coconuts from
Jamaica, etc. Let the Wal-Mart in Nigeria be a Nigerian Wal-Mart. That
desire neither belies the reality of globalised retail market nor does
it underestimate Nigerians’ taste for all things foreign. Rather, it
reinforces Nigeria’s comparative advantage in the manufacture and supply
of specific items for integration into the global retailer’s supply
chain with opportunity for blending Nigerian branded products and even
services into Wal-Mart’s global reach.
Another peculiarity of a Nigerian
Wal-Mart is that it will inevitably diverge from the brand’s low price
and egalitarian customer appeal. In Nigeria, Wal-Mart will be for the
urban middle and upper class. Perhaps, rightly so; in the light of the
incredible gulf between the rich and poor in Nigeria for which
Wal-Mart’s wares and services will be priced out of the reach of the
poorest of the poor. Add to that, the inaccessibility of slum dwellers
to the retailer’s predictably choice locations in increasingly
segregated Nigerian mega urban centres. Like other game changers,
Wal-Mart will be a disruptive influence on Nigeria’s informal retail
landscape and the country’s informal economic hinterlands. For as long
as our governments are incapable of providing solution to mitigate such
disruptions, let Wal-Mart remain in Lagos, Port Harcourt, Abuja and
Kano.
Nigerian governments and regulators
should ensure to not allow Wal-Mart and its ilk to play into the
long-held but skewed philosophy of American monopolists: “that strength
gives the strong in the market the right to destroy its neighbour” -the
weaker others. Wal-Mart in Africa must be prepared to operate with a
commitment to balance wealth with the commonwealth, a lesson long lost
to corporate America but which must form the foundations of new
corporate-driven commercial and economic transformation happening across
Africa
.
No comments:
Post a Comment