Nigeria Best Place To Invest In Africa – Koebel | Independent Newspapers Limited
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CEO Interview

Nigeria Best Place To Invest In Africa – Koebel

Posted: May 30, 2016 at 2:05 pm   /   by   /   comments (0)

Philippe Koebel is senior vice-president,  Emerging Markets and Indirect at Orange Services. He described Nigeria as the economic powerhouse of Africa and the best place to invest on the continent. The company recently opened a new office in Lagos to increase its presence in the Nigerian market.

Koebel spoke with a group of journalists after the event. Ikechi Nzeako was there. Excerpts:

Why are you increasing your presence in Nigeria?

 We are growing year on year and we are basing our growth especially on Africa. Africa is a big part of our growth projections. We have domestic operations and business operations in Africa. This basically is why we are here. At orange business services, we are targeting multinational customers and this means that our market analysis starts with the fact that these multinational customers have decided to locate to two places in Africa: Johannesburg in South Africa and Lagos in Nigeria. What this means is that more companies are locating to Lagos. This is the basic reason why after having been in Lagos for a long time, we have decided to increase and accelerate our presence in Lagos by putting up a second office here. We are also increasing the number of our staff here. We will never be a very big company in terms of having hundreds people because we are not targeting the domestic market but we are targeting the international market. The international market means a series of customers in sectors in certain precise and verticals like the banking sector, oil and gas and others. We already have existing customers and our intention is to grow it by at least double digit every year in the next five years.

Why did it take Orange Service so long to come to Lagos?

We have been in Lagos since a long time ago. Our sales force was scattered all around West Africa but we had an important presence in Johannesburg. We had people in Ivory Coast, Gabon, Cameroon and we said this was not very efficient. We said we should put our energy in one place and definitely in terms of customer base and in terms of the future of the economy of the country. We decided that Lagos was the best place to go. This is my first time in the country and I have seen very interesting things; Nigeria may be in an economic downturn as somebody said but we believe that this will pass. In the way we operate, in an economic downturn we believe that we have a business to do and there are opportunities in the sector we have mentioned.

 Can you share some of the interesting things you have seen?

 This is coming from the dynamism of the Nigerian economy itself. Let us take the example of First Bank of Nigeria; this is a customer that we have had since two or three years. We had contact with this bank and of course this bank is growing in the Nigerian economy and because of the relations they had, we said it was not right to stay outside Nigeria. We want to expand and use the friends we have in Nigeria to go to other countries. And typically this was the way multinational companies expanded, namely with a strong base in a big country and then going outside. This was the way multinationals in the U.S. started; this was the way multinationals in China started. Anyway, Nigeria is the biggest country on the African continent and it is logical to see that these customers will grow and we will provide them the right services. Our services are based on customer experience; this may look a little bit old fashioned because people talk about technology: Whatsapp, twitter, facebook, Linkedin and others and we are talking about customer experience. This is very important because, let us take the case of First Bank of Nigeria, they are happy with the network we sold to them because they do not experience any interruptions in their operations. The banking sector is very critical and they will not accept interruptions in their operation that you and I will accept in our Internet connections. They have started to use our services beyond the network and that is why I said I see interesting things happening in the Nigerian economy. We have Ecobond, which is a company with headquarters in Togo, not in Nigeria; but Ecobond operations in Nigeria represent half of the overall turnover of the company, which means that Nigeria, Lagos, is the place to be to really maximise Ecobond. This is typically the type of situation we are facing. I believe also that we have other customers that are based in South Africa, but which consider Nigeria as the place to be. We are not very clever, we just saw what is happening in the market and we just follow.

 I understand that your operations will run on massive infrastructure; we have infrastructure gaps and challenges in Nigeria. How do you hope to bridge that gap?

 Our intention is not to invest in infrastructure in Nigeria because we are not a telecom operator in Nigeria. However, we are providing services to multinationals like Total. Total is a big company in Nigeria and is present in Lagos, Abuja and Port Harcourt, and we have delivered to them a tele-presence system and they are happy because they can do many of their meetings using system we have provided them. International telecommunication infrastructure has two dimensions, we can install sites in Nigeria using the infrastructure of Glo, Airtel, MTN or Etisalat or we can install antennas in the country. We can also develop our international point of presence, which is in Lagos, connecting to the cables; connecting to the satellites. Therefore, we can bring a lot of capacity to the country. I believe this is the way we can develop infrastructure in the country without being too much handicapped by the fact that there are gaps in domestic infrastructure in the country.

 Nigeria is working towards putting in place a broadband regime; it is targeting 30 per cent by 2018. What can Orange Services do to fast-track the achievement of that target?

 We are not exactly in the same dimension, I would say; what we will continue to do is to invest in the cables and capacity going outbound of Nigeria, which will allow the country to be better connected to the rest of the world. Our objective is better international connection and we will invest in order to increase the capacity of the cables. When you look at the telecom industry, 90 per cent of the infrastructure and revenue and investments are for domestic communications and only ten per cent is outbound; we want to provide for the outbound communications.

 You talked about diversifying into the banking sector; can you tell us more about your diversification programme?

 This started with the project called Orange Money; Orange Services is a typical consumer business and is doing business to business and not business to consumers. Orange Money is operated in a country where people have no bank accounts but they can make transactions using a mobile phone. It was the starting point and we realised that retail banking has become generalised and that customers do not go to banking halls to make transactions. They use a mobile phone. We said that our business is not too far from banking business and when you enter a country’s banking sector, there are a lot of regulations, rules and laws, which you have to follow. What we have done is to acquire a bank in France for now. This bank is the banking arm of a big insurance company. This bank has a structure and we will bring our digital experience to bear on the operations of the bank.

What role will the Lagos office play?

The expanded Orange Business Services presence in Lagos will support the many Nigeria-based businesses, who want to increase their business performance and profitability.

We act as a trusted advisor to help our customers compete on an equal footing in what is rapidly becoming a global market. This includes competitive, high quality IT services delivered in all countries in which they operate.

Orange Business Services in Nigeria will also support both Nigeria-based businesses, which are growing and transforming thanks to digital technologies, and multinational companies from elsewhere on the continent and beyond, which are looking to expand within Africa. We place great emphasis on local presence in our markets.There are many growth opportunities in IT, particularly in high-growth markets like Nigeria and across West Africa, but these can only be harnessed if service providers have a local understanding of strategic, political and cultural sensitivities in a region. Orange will deliver consistently reliable telecommunications across Africa, including in hard-to-reach places and in jurisdictions where the regulatory environment is still developing.

In addition to West Africa, Orange Business Services is present across North and South Africa. Customers are supported by global customer service centers in Cairo and Mauritius – part of a network of five centers worldwide. Further, Orange Business Services is the only global telecommunications service provider that has been rated as “strong” for its coverage in the Middle East and Africa region by IT research company Current Analysis. And in 2015, it was named the winner of the Total Telecom Award for Best Enterprise Service in Africa with Business VPN Hybrid, and Best VSAT Operator, Africa.

Orange has a strong commitment to the African continent, which has been at the heart of the Orange business strategy for the last few decades. The Group has a long-term approach to its presence in the region and has invested heavily to support infrastructure development and innovations that have changed the social and business landscape.