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The evolution of Nigeria movie industry: Nollywood

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The video-film industry of Nigeria has been described as one of the greatest explosions of popular culture that Africa has ever seen. It is the first economically self-sustainable film industry in Africa.

Last year, the Nigerian government released data showing tha t Nollywood is a $3.3 billion industry. After the release of that data, Nigeria’s National Bureau of Statistics also collated data that highlighted Nollywood’s greatest shortcoming: ‘severe revenue bleed’.

Of the industry’s $3.3 billion valuation less than 1 percent was tracked from official ticket sales and royalties.

The rest came from pirated reproductions sold by unauthorized vendors for roughly $2 each. As a result, producers and financiers see only a fraction of the movie industry’s economic value. Initially through the use of video technology, and now affordable digital technology, Nigeria produces more than 2000 films per year.

The industry, popularly called Nollywood, is currently ranked as the second-largest in the world in terms of output after India’s Bollywood.

Nollywood’s popularity has spread across the African continent, to the African diaspora in Europe, North America and Australia. It has even gone as far as the Caribbean and Pacific Islands.

OVERCOMING THE CHALLENGE

The first seeds for the emergence of the industry were planted in the late 1980s. Nigeria was experiencing difficulties as a result of political unrest and measures imposed by the International Monetary Fund and World Bank.

This economic climate made film-making on celluloid prohibitively expensive, and created a fertile ground for other, more affordable methods to emerge. In 1992, in Nigeria, electronics salesman Kenneth Nnebue shot a straight-to-video movie in one month, on a budget of just $12,000.

Living in Bondage sold more than a million copies, mostly by street vendors, and Nollywood – Nigeria’s movie industry – was born.

“The film follows the tale of a man who joins a secret cult and murders his wife in a ritual sacrifice to gain wealth. It is set within the thematic and stylistic characteristics of superstition, witchcraft, religion, the quest for upward mobility and melodrama in Lagos’s urban landscape.

It explores corruption, love triangles and domestic dispute.” All themes have since been replicated in many Nollywood narratives.

THE TRANSITION FROM VHS TO DIGITAL

Since the VHS industry of the 1990s, Nollywood has embraced digital technology. The industry captures the entrepreneurial spirit of Nigeria through the use of affordable and accessible technology.

These are small-scale digital cameras, desktop editing software, and distribution primarily on DVD and video compact disc. These sell for around $2 per copy in Nigeria, and are watched at home, on street corners, in cineclubs or in video parlors.

While the term Nollywood is generally used to refer to the entire industry, it is important to note that it is not unified. There is a great deal of diversity and many different variations.

Different genres exist, including horror, melodrama, comedy and action, as well as language divisions. It also includes films in English, Yoruba, Igbo and Hausa. Despite its enormous output, financing was low, with the average budget for a Nollywood film being around $20,000 to $75,000.

The industry was often criticized for low production values. It was characterized by rapid turnaround times, the lack of script development, bad lighting and sound, low-budget effects and amateur editing. Directors were mostly self-taught, and were often less important and lower down the Nollywood food chain than stars, producers and distributors. Distributors often act as producers.

Despite all of this, the popularity of Nollywood demanded film aficionados, scholars, festivals and cinema programmers to take it serious. Currently, a growing body of Nollywood scholars have emerged over the past 15 years.

THE NEW FACE OF NIGERIA MOVIE INDUSTRY: ‘NEW NOLLYWOOD’

A number of Nollywood directors have started to make higher quality films. These are sometimes referred to as “New Nollywood”, New Nigerian Cinema, or the New Wave.

These films are seen more widely than standard Nollywood fare and are accessible to non-African audiences. New Nollywood includes the work of directors such as Kunle Afolayan, Obi Emelonye, Jeta Amata, Stephanie Okereke and Mahmood Ali-Balogun.

The budgets raised for the production of films have also increased considerably, ranging from $250,000 to $750,000.

The production cycles are also much longer. The New Nollywood films are therefore recognized as very different from the low budget video format films of old.

By 2009, Nollywood had surpassed Hollywood as the world’s second largest movie industry by volume, right behind India’s Bollywood. Critics note that while Nollywood has volume, it lacks production value, and African actors have yet to breakout globally.

“The truth is key players in the global movie industry still have little idea what Nollywood is about,” said Nigerian producer Kunle Afolayan.

“The volume won’t matter until we can connect the art to the money with better content and profits.” Red-carpet premieres attracting huge audiences now take place regularly across the world from Nigeria to other African cities and urban centres with a big African diaspora.

Film festivals internationally have also picked up on its huge popularity. Special programs with a Nollywood focus have taken place in Paris, London and New York, among others.

Many observers believe that the global reach of African films could take off, led by video on demand (VOD) platforms and productions of Nigeria — the continent’s largest economy and most populous nation. Such examples include pay-TV networks and free-to-air broadcasts across the continent and beyond. South Africa’s M-Net, which broadcasts across Africa, has channels dedicated to Nollywood.

Intrepid distributors, mostly from the African diaspora, have created such platforms, video-on-demand, for Nollywood. One example is the huge iROKO tv. This has increased accessibility to African diaspora audiences.

Even Netflix has acquired a number of Nigerian films, indicative of the platform’s realization of Nollywood’s popularity and commercial potential across the world. . Earlier this year, Nollywood Producer Kunle Afolyan reached an exclusive Netflix distribution arrangement for his latest film, October 1. This adds to the 10 Nollywood related titles already on Netflix and the U.S. media company’s recent $12 million movie rights purchase of Nigerian novel Beasts of No Nation, to star Idris Elba.

THE APPEAL OF HOMEGROWN STORIES AND CHARACTERS

But it is in Africa that Nollywood has had the greatest impact. For African audiences who have for decades been fed imported films, the development of a local, homegrown film industry was hugely significant and important.

Nollywood’s popularity has spread across the continent and Nollywood films are watched all over Africa, from Kenya and Tanzania to Cameroon, Guinea and Togo. They are sometimes dubbed or translated through live interpretation at public screenings.

The model has also been exported and adapted across the continent. Videofilm industries have been emerging in many countries, including Riverwood in Kenya, Ugawood in Uganda, Bongowood in Tanzania and Ghollywood in Ghana.

There are also similar industries in the Democratic Republic of the Congo, Cameroon, Ethiopia, Eritrea, Zambia, South Africa and Zimbabwe. The most obvious explanation is that the films display familiar and recognizable cultural beliefs, lifestyles, traditions, societal and sociocultural structures, histories, settings and locations.

Their themes and narratives tap into the fears, dreams and aspirations of audiences. Nollywood seems set to expand, grow and diversify along with audience tastes, viewing habits and the industry’s technological advancements.

This is also evident in the hugely popular Tanzanian video-film industry, Bongowood. Tanzanian audiences initially watched imported Nollywood films, but from the early 2000s aspiring local filmmakers started to produce their own video-films.

The popularity of local Bongo films now outweighs Nollywood films in their country. As Africa’s VOD platforms improve prospects for the continent’s films by formalizing revenue and distribution streams, Nollywood may not be the only industry to profit. U.S. digital content purveyors could benefit too.

“If we can solve these monetization challenges for African creative content, it can apply to any creative content,” said Jason Njoku.

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Nigeria

Nigeria’s economy in 2019: Woes or fortune?

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As 2019 begins with hopes and aspirations, there are expectations from the federal government to better the economy with a view to making it have more meaningful impact on Nigerians. Here are the looks at the key indicators that will characterize the economy and determine its fortunes this year.

The economy appears to have lost its sparkle; its growth has dwindled. And there are palpable fears that the effect of political activities in the lead-up to the general elections, scheduled to commence on February 16, could overshadow whatever gains the economy may muster during this period, thus, compounding its woes. As it stands, the federal government has abandoned the economy for politics and the economy is already bearing the brunt.

After five quarters of recession, which the economy entered in the second quarter of 2016, having plummeted to a gross domestic product (GDP) growth rate of -2.06 per cent, the economy exited the quagmire in the second quarter of 2017 with a GDP growth rate of 0.55 per cent, which was revised upward to 0.72 per cent, according to data from the National Bureau of Statistics.

Then, the economy turned the corner as it grew at 1.40 per cent in the next quarter- that is, the third quarter of the year, and sustained the improvement recording a GDP growth rate of 2.11 per cent in the fourth quarter of the year 2017. However, in the first quarter and second quarter of 2018, the economy reversed the rising streak as evidenced in the slowed growth rates. NBS data showed that the GDP growth rate fell to 1.95 per cent in the first quarter of 2018 from the 2.11 per cent it achieved at the end of 2017. It dropped further to 1.50 per cent in the second quarter.

The agency noted that the clashes between farmers and herdsmen, which took its heavy toll on agriculture, mainly dragged down the growth rate during the quarter under review. Agriculture, being a major component of the non-oil sector was badly affected. However, with improvement in the non-oil sector, the economy received an impetus for growth, which pushed the GDP growth rate to 1.81 per cent. According to NBS, growth in the third quarter was largely helped by the non-oil sector, which contributed 90.62 per cent to the total GDP, while the oil sector contributed 9.38 per cent to growth in the review period. Oil GDP was reported to have contracted by -2.91 per cent compared to -3.95 per cent in second quarter and 23.93 per cent in third quarter 2017.

Despite the improvement in growth rate in the third quarter of 2018, the economy is still experiencing slowdown and was recently put on red alert of slipping into another recession over weak economic growth.

According to the Governor of the Central Bank of Nigeria, Mr. Godwin Emefiele, who raised the alarm at a recent Monetary Policy Committee meeting, the economy may be under threat of relapse into a recession, which it recently exited from with fanfare, given the weak economic growth of the second quarter of 2018.

Emefiele also raised concerns about threat to efforts to curb inflation, stabilise exchange rate and build reserves, considering the macroeconomic fundamentals at the period.

The consumer price index, which measures inflation dropped from 11.28 per cent in September 2018 to 11.26 per cent in October 2018 and rose again to 11.28 per cent in November 2018, but when compared with the levels in the corresponding year of 2017, when it dropped from 15.98 per cent in September to 15.91 per cent in October and 15.90 per cent in November, it was not where the monetary authority had envisaged it would be. The apex bank has the onerous task of bringing inflation to its targeted single digit, especially in an election year.

Also, of note as a potential contributor to relapsing the economy into recession, as pointed out by the CBN governor, was the delay in budget implementation. A situation, where three months after presidential assent and about three months to the end of 2018, there was no budget implementation was unhealthy for the economy. According to the apex bank, long years of fiscal policy lag had contributed to the weakness in the economy. Most of the inimical factors identified by Emefiele at that time are still at play.

Given this scenario, as the New Year begins, economic managers have the arduous task of resolving those issues as well as ensuring the economy not only continues to grow, but also record appreciable and inclusive growth. While 2019 is an unusual year, being an election year, more, but critical efforts would be required by handlers to put the economy on a sure footing with a viewing to avoiding a relapse into recession.

The federal government has proposed a budget of N8.83 trillion for the 2019 fiscal year. Nigerians would not accept any excuse for delay in its passage and poor Implementation. The executive and the National Assembly should therefore quickly address the grey areas and harmonize their positions so that the appropriation bill could be passed into law and implemented in earnest.

The budget has been predicated on an oil-price benchmark of $60 per barrel. In recent times, oil prices have been sliding at the international market and currently stood around $54 per barrel. The falling oil prices have been identified as threat to implementation of the budget and as such, the relevant authorities would do well to peg the budget at the most appropriate benchmark.

As part of its strategy to mobilize revenue, the federal government through the ministry of finance, in July 2017, created Voluntary Assets and Income Declaration Scheme (VAIDS), a tax amnesty, which was expected to rein in $1 billion from tax evaders and avoiders. By the end of the scheme, one year later, with only about N30 billion, the proceeds fell short of the government target, but the scheme was able to swell the tax database by five million to 19 million from 14 million. The government is expected to follow up on this initiative as well as intensify the revenue mobilization from more alternative sources than oil and borrowing to fund the budget. As at the end of 2018, the total collection by the Federal Inland Revenue Service was about N7 trillion.

Besides, the federal government is expected to review the power sector transition market policy performance this year after its first five years of implementation.

It is obvious that this present administration led by President Muhammadu Buhari, which is already pre-occupied with politicking ahead of the general elections, would not be able to solve the burgeoning unemployment problem. With unemployed Nigerians now at 20.9 million, having risen by 17.6 million in nine months, one of the major tasks before the incoming administration is to tackle the factors causing unemployment or to put it more aptly, provide employment opportunities in the economy and tame the rising scourge of unemployment.

Besides, Nigerians are anxiously waiting for positive outcomes from the talks, between the Nigeria Labor Congress and federal government over the N30, 000 minimum wage, that have resumed and are expected to be brought to a logical conclusion before the general elections.

 

Experts’ Views on the Economy

But in the view of the Chief Executive Officer of Financial Derivatives Company Ltd, Mr. Bismarck Rewane, political jostling and the elections would becloud the talks on the minimum wage. He also expressed the opinion that political activities and elections would becloud 2019 budget talks by the legislature and the first monetary policy committee (MPC) meeting in the month of January.

Also, in his projections, Director, Union Capita Market Ltd, Mr. Egie Akpata, posited that 2019 would likely be more challenging for the Nigerian economy than 2018.

According to him, most variables which were in the country’s favor last year, but not capitalized on, have reversed. “Oil prices, local interest rates, inflation, stock market indices, political environment and other variables that were positive for most of 2018 are now negative and will remain so for most of 2019.”

On the key areas that are likely to impact the entire economy, Akpata noted that in the aspect of government finances, it was unfortunate that for the federal government, tax revenues could be generated by threat or decree.

“The VAIDS programme fell far short of expectation and so did many other initiatives to diversify government revenues away from oil. These failures are not surprising. Individuals and companies have to be financially buoyant to pay a lot of tax. The reality is that most sectors of the economy are in a recession and profitability has been badly eroded.

“Self-inflicted damage from Apapa ports congestion, inability to solve the power crises, government crowding out the private sector in the debt markets, insecurity in large sections of the country amongst others mean that corporate profitability is unlikely to improve and hence better non-oil revenue for the government will take a while to materialize.”

Akpata added that, the federal and state governments had shown that they were unable to reduce their costs and instead had resorted to massive borrowing, particularly at the federal level.

This borrowing, he pointed out, was almost entirely to fund overheads. “Unfortunately, this produces very high market borrowing rates which very few private companies can afford. As long as the economy continues to have a risk free rate close to 20 per cent, it is unlikely that there will be massive credit to the private sector to drive the investment needed to grow the economy at the required levels.”

“Until there is a political force to stop government simply borrowing to fund overheads, FGN debt will continue to grow at an alarming rate. Since a default is very unlikely, the market will happily give the FGN all the debt it wants to pay its bills today. Repayment is largely a problem for future governments to worry about,” he also submitted.

He argued that the presented 2019 budget showed that “it is business as usual – unrealistic revenue targets, huge borrowing and waste on fuel subsidy. None of these are a positive for government finances,” stating that, the ongoing minimum wage battle with the NLC would likely result in some kind of wage increase, which will put more pressure on government finances.

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