For­eign re­tail­ers chase volatile but boom­ing Kano mar­ket

Daily Trust - - BUSINESS -

Open­ing a mod­ern su­per­mar­ket in a city un­der threat from an Is­lamist in­sur­gency, with the added un­cer­tainty of wob­bly pub­lic power sup­plies, may sound like a re­tailer’s nightmare.

But what if that city stands on one of the old­est trade cross­roads in Africa, of­fer­ing a ma­jor chunk of one of the largest and fastest-grow­ing re­tail mar­kets on the con­ti­nent? Small won­der then that ma­jor re­tail in­vestors like South African gro­cer Sho­prite and Wal-Mart unit Mass­mart Hold­ings are open­ing stores in Nigeria’s sec­ond city of Kano, the north­ern commercial hub of Africa’s No. 1 oil pro­ducer and, since Sun­day, its largest econ­omy.

“I al­ways want to be bold enough to say, you can’t be in Nigeria with­out be­ing in Kano,” Mass­mart Hold­ings’ Africa Di­rec­tor Mark Turner told Reuters in Jo­han­nes­burg at the Reuters Africa Sum­mit this week. Nigeria, along with An­gola and Kenya, is a strate­gic tar­get mar­ket for the Wal-Mart sub­sidiary.

Kano is a dusty cen­turies-old Sa­hel belt me­trop­o­lis that once of­fered gold, salt, slaves, leather and famed in­digo-dyed tex­tiles in its teem­ing mar­kets at the end of an an­cient car­a­van route link­ing Libya to black Africa south of the Sa­hara.

Now, amid ban­ner signs pro­claim­ing “lower prices you can trust”, Kano con­sumers can wheel their carts be­tween shelves re­plete with commercial brands from across the globe in a brand-new, air-con­di­tioned Sho­prite su­per­mar­ket, an­chor­ing a larger $85 mil­lion shop­ping mall de­vel­op­ment in the city.

In the com­ing weeks, Mass­mart will join Sho­prite by open­ing one of its Game house­hold ap­pli­ance stores in the same Ado Bayero mall, named af­ter the lo­cal Kano emir. The mall is de­signed to house 85 shops and will be among Nigeria’s big­gest.

But the pres­ence of armed and uni­formed guards search­ing ve­hi­cles - open­ing boots, check­ing the un­der­side for ex­plo­sives with mir­rors - and frisk­ing all shop­pers is a sign that this par­tic­u­lar mall lo­ca­tion faces un­usual se­cu­rity chal­lenges.

De­spite be­ing 600 km (375 miles) dis­tant from Maiduguri, the epi­cen­tre of a bloody five-year in­sur­rec­tion against the Nige­rian state waged by Is­lamist sect Boko Haram mostly in the north­east, Kano has also suf­fered the in­sur­gency’s im­pact.

Bomb­ings and shoot­ings by Boko Haram mil­i­tants killed at least 185 people, mostly Mus­lim civil­ians, in Kano in Jan­uary, 2012. Ex­plo­sions in July last year killed 11 people, and po­lice and mil­i­tary road­blocks are now a fea­ture of life in the city. “We can­not wish away the fact that there are se­cu­rity con­cerns,” Mo­hammed Hay­atu-Deen, the Maiduguri-born en­tre­pre­neur and banker who chairs the group de­vel­op­ing the Kano mall, said.

The hulk­ing power plant stand­ing along­side the mall build­ing - ca­pa­ble of pro­duc­ing nearly 5,000 kilowatts - is tes­ti­mony to an­other chal­lenge: guar­an­tee­ing un­in­ter­rupted elec­tric­ity in a coun­try whose power deficit is no­to­ri­ous and where the rum­ble of the gen­er­a­tor start­ing up is as fa­mil­iar as the roar of traf­fic. Reuters

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