Abdul Rotimi Mohammed

The last three days of 2025 will surely be days to remember, as each day presented the business community with a new mega deal. The deal we will be discussing in this article involves Eko Disco. Transgrid Enerco acquired a 60% controlling stake in Eko Disco from West Power & Gas Limited (WPG) in a deal valued at about ₦360 billion (about $300 million). This is one of the largest privately negotiated takeovers in Nigeria’s power distribution sector since the 2013 privatization. The ₦360bn transaction was structured with ₦180bn upfront cash and ₦180bn in bank guarantees, showing confidence in long‑term returns.

Transgrid Enerco is a strategic alliance formed by North South Power Company Ltd (NSP), Axxela Limited, and the Stanbic IBTC Infrastructure Growth Fund (SIIF). NSP is one of Nigeria’s largest independent power producers. It operates the Shiroro Hydropower Plant and has significant experience in generation. NSP is responsible for providing technical and operational expertise for the consortium. Axxela Limited, a leading energy infrastructure company, formerly part of Oando Plc, focuses on natural gas distribution and energy solutions. It brings downstream energy and infrastructure management experience. SIIF is a private equity fund managed by Stanbic IBTC Asset Management. It provides institutional capital for large infrastructure projects. These 3 represent a blend of technical, operational, and financial strength, making Transgrid Enerco one of the most significant new forces in Nigeria’s electricity distribution sector.

WPG originally acquired the 60% stake in 2013 during the privatization exercise. It seems to have decided that now was a good time to divest, having acquired the stake for $135 million. The new owners plan to upgrade infrastructure, improve customer service, and expand distribution capacity. The deal marks a major consolidation in Nigeria’s distribution sector, echoing similar restructuring seen in generation (the Geregu Power sale).

Like any other mega deal, this one presents opportunities and risks. On the opportunities side, the fresh capital injection could improve metering, reduce losses, and enhance reliability. On the risks side of the equation, distribution companies still face tariff disputes, regulatory uncertainty, and transmission bottlenecks.

The Nigerian government has been pushing for recapitalization and efficiency in DisCos. Transgrid Enerco’s acquisition aligns with this agenda, positioning it as a partner in reform and modernization. The deal reflects ongoing consolidation in Nigeria’s power sector where stronger, better‑capitalized players are taking over assets from privatization‑era investors who are exiting. It also demonstrates that distribution assets remain attractive to institutional investors, despite sector challenges. This could encourage more capital inflows into other DisCos, spurring further restructuring.

In closing, the sale of WPG’s stake in Eko DisCo to Transgrid Enerco harbours renewed investor confidence, sector consolidation, and the promise of modernization in Nigeria’s electricity distribution sector. If executed well, it could mark a turning point for Lagos’ power supply, but the gains will only materialize if tariff reforms, infrastructure upgrades, and regulatory stability accompany the ownership change.

Key stakeholders in Nigeria’s dairy industry met recently in Abuja to validate the Implementation Framework of the National Dairy Policy. The policy provides the roadmap for ending Nigeria’s $1.5 billion annual dairy import bill.

The event marked a significant milestone in the nation’s agricultural transformation agenda. It was noted during the event that despite having an estimated 58 million cattle, Nigeria still spends over $1.5 billion yearly importing milk and other dairy products.

Several incentives were announced that were designed to accelerate domestic milk production including five-year tax holidays for new dairy processors, low-interest loans for farmers, tariff protection for local producers and the establishment of well-equipped dairy hubs across key production zones. Also proposed were school feeding programmes that use locally sourced milk, guaranteed off-take arrangements and the deployment of dairy extension officers to improve smallholder productivity.

The Federal Government’s commitment to the dairy sector was reaffirmed as the sector was noted as a driver of industrial growth, job creation and food security. It was further noted that though the sector (dairy as opposed to livestock as a whole) was home to more than 20 million cattle, it produces only about 700 million litres of milk annually — less than half of national demand, estimated at 1.6 billion litres.

The supply gap was noted to be both a challenge and an opportunity, and that operationalizing the Dairy Policy would align government and private sector efforts to achieve self-sufficiency in milk production.

It was noted that with effective implementation that, the policy would empower farmers, create decent jobs and significantly reduce our dependence on imports. It was further noted that the policy provides for the establishment of a National Dairy Development, a Milk Marketing Board and a National Dairy Development Fund to coordinate value chain activities and ensure sustainable financing.

Calls were made for stronger institutional capacity, private sector-led innovation and Nigeria’s participation in the International Dairy Federation to benchmark global best practices. It was noted that that countries such as India, Kenya and Ethiopia had shown that with clear institutional mandates and cooperative development, the dairy sector could become a major driver of rural transformation.

The president of the Commercial Dairy Ranchers Association of Nigeria (CODARAN), M.D. Abubakar described the framework as a roadmap for systematic development of the dairy industry. He stressed the importance of backward integration, where dairy processors invest in local milk production, feed formulation and breeding programmes as a sustainable route to self-reliance.

“Backward integration is a tested and proven strategy for achieving local dairy development while reducing and ultimately eliminating dependence on imported milk,” he said. He called for immediate establishment of the proposed National Dairy Development and Marketing Board and the Development Fund, as well as the introduction of special levies on imported dairy substitutes to encourage local production.

Across all sessions, participants expressed strong support for the Implementation Framework and reaffirmed their collective resolve to build a competitive and resilient dairy economy driven by innovation and local investment. The validation of the National Dairy Policy Implementation Framework, they agreed, marks the beginning of a new chapter for Nigeria’s livestock sector — one that promises to enhance rural livelihoods, strengthen food security and conserve foreign exchange.

BACKGROUND

For centuries, Fulani pastoralists have been the backbone of Nigeria’s dairy sector, producing raw milk consumed in rural and urban areas.

During the colonial and post-independence eras, there were early attempts at commercial farming at government ranches in places like Vom in Plateau state, Obudu in Cross-River state and Mokwa, Niger state. Wartime (i.e. World War 2) restrictions on dairy produce imports and a ban on Clarified Butter Fat (CBF) exports played a crucial role in the growth of Nigeria’s dairy sector. CBF is obtained from the separation and processing of milk cream from the milk itself. After removing the cream, what remains is skimmed milk. However, as the wartime restrictions were lifted, the growth spurt stalled as the government ranch at Vom closed down in 1954. In general, the ranches struggled due to poor management and lack of adaptation to local conditions.

After the colonial period, and as part of the government’s strategy to encourage dairy industrial development, the federal, regional and/or state governments established several dairy-processing plants throughout the country. Among these were Madara Limited in Jos, Plateau State, and Agege Dairy Farm near Lagos. Other government dairy farms were established at Ibadan, Kaduna, Maiduguri, Minna, Ilorin and Kano.

These interventions by the post-colonial governments created awareness of the need for dairy development as part of the overall efforts to improve on the performance of the livestock subsector. This resulted in the establishment of more milk processing plants by both the private and public sectors, as a means of catalyzing domestic production. However, the availability of cheap imported milk powder in particular and other dairy products in general created a disincentive for the development of a domestic dairy industry, particularly as the processing plants completely neglected the appropriate pricing and milk collection aspects.

The dairy industry today consists of a mix of pastoralists, commercial dairy operators and importers. The pastoralists are responsible for 95% of domestic production. The importers are by far the largest segment of the industry with over 60% market share. They mostly import powdered milk and derivatives from Holland, Denmark, New Zealand, etc. This segment use mainly imported powdered milk for their products (97%).  Very few use locally sourced raw milk to complement their products. They sell processed products formally.

The key challenges the industry currently faces include the following:

• Low productivity: Indigenous cattle breeds yield only 1–2 liters of milk per day compared to 20–30 liters from improved breeds in the west. Kenya manages to get yields of 10 liters per day.
• Infrastructure gaps: Poor cold chain, limited processing facilities, and weak rural transport networks hinder milk collection.
• Import dependence: Nigeria spends billions of naira annually importing milk, undermining local production.
• Pastoral conflicts: Herdsmen–farmer clashes disrupt supply chains and discourage investment.
• Policy inconsistency: Shifting government policies on import tariffs and local sourcing targets create uncertainty for investors.
• Limited financing: Smallholder farmers lack access to credit, veterinary services, and modern feed systems.

Possible solutions to these problems include:

• Breed improvement: Introduce crossbreeding programs to raise yields, combining local resilience with high‑yield exotic breeds.
• Value chain development: Invest in milk collection centers, cold storage, and rural road networks to reduce spoilage.
• Policy support: Enforce local content requirements gradually, while offering incentives for processors to source domestically.
• Public–private partnerships: Expand collaborations like FrieslandCampina’s Dairy Development Program, linking pastoralists to processors.
• Conflict resolution: Address pastoralist–farmer clashes through grazing reserves, ranching initiatives, and community dialogue.
• Capacity building: Train farmers in modern husbandry, feed management, and veterinary care.
• Financing and cooperatives: Provide microcredit and strengthen dairy cooperatives to empower smallholders.

Part 3 of this series can be found here.

John Maynard Keynes

John Maynard Keynes is widely considered the most influential economist of the 20^th century. He even made Time Magazine’s list of the 100 most influential people of the 20^th century. Keynes was a towering intellect with wide-ranging interests and many achievements, but his greatest claim to fame no doubt, is the reputation accorded to him as the man who ended the “Great Depression” and birthing in the process, the field of macroeconomics.

The Great Depression as the name suggests was a time of great misery in the west. Starting with the great stock market crash of 1929, it lasted about 10 years. It was a global economic crisis marked by significant declines in industrial production, prices (deflation), mass unemployment, banking panics, and increased poverty and homelessness.

Perhaps some actual figures will give a better idea of how bad things really were. In a crazy two month selling spree, about $34 billion in market value was wiped off the stock market. That today would be worth about $607.58 billion. By the end of 1930, a quarter of factory workers had lost their jobs. Wages were down by 60%. Standard of living was set back about 20 years. To say that the times were hard is an understatement.

What made it all the more frustrating was that the standard economic theory about how money markets functioned suggested that prolonged depressions shouldn’t exist. To see why, we might have to back up a bit and try to understand fundamental concepts about the interplay between savings and investments (by saying investments, I am using the term the way an economist would use it and not the way, say a mutual fund manager would use it. So investments here do not refer to acquisition of stocks, bonds and other financial instruments but to the acquisition of production machinery, the building of offices and factories for the purpose of carrying out production).

Healthy economies typically have significant amount of savings. For those economies to stay healthy, savings must be put to productive use. Those productive uses are typically carried out by businesses who mop up savings and use them to make investments in a bid to expand production. Money markets exist to enable businesses access savings. Money markets facilitate the flow of short-term funds between borrowers and lenders, helping businesses, governments, and individuals manage their immediate cash needs. Businesses however, aren’t always in a position to make investments. If such a situation persisted, standard economic theory suggested that the interest rates that businesses ordinarily should pay to lenders for the privilege of gaining access to savings should fall, making savings cheaper to access and thus eventually inducing businesses to borrow savings for the purpose of making investments, but this was not happening during the Great Depression and nobody knew why.

It fell to Keynes to explain the puzzle. He explained that with each successive round of non-investment by businesses, the economy contracted, contracting the nation’s savings with it, thus making less and less savings available for each investment round, eventually grinding the economy to a halt. As a solution, he proposed that where businesses failed to invest that government should pick up the slack until businesses were in a position to resume investment activity. His ideas were put into practice and they eventually ended the Great Depression. Keynes would make other important contributions to economics, finance, mathematics and even theater. The man is still largely venerated to this day.

In the four posts in this series, we having been surveying the ideas of some history’s greatest economic thinkers, men who peered deep into the chaos of the market economy and divined its natural rhythms discovering that despite the appearance of chaos on the surface, the economy was driven by scientific laws, which had a firm hold on the economy much like how the law of gravity has a firm hold on the physical world.

Today, the successors to these great men have gone beyond explaining markets to actively shaping them. The economist has become an engineer. All over the world, the ideas of economists have gone on to shape government policy, leading to the creation of many new businesses and unlocking trillions of dollars in economic value. Some of these ideas have made their presence felt in Nigeria like the original auctions held for mobile licenses, after the resumption of democracy in 1999, leading to the GSM revolution. Others though occurring in other parts of the world, have had a global impact of which Nigeria is a beneficiary, like the deregulation of the telecom sector in the US, which played a crucial role in launching global ecommerce. Perhaps we would do well to lean more on our economists for desperately needed ideas on the way out of our current economic logjam.  

Bibliography

1. Heilbroner, Robert. 1965 The Worldly Philosophers: The Lives, Times and Ideas of the great Economic Thinkers. New York: Simon and Schuster
2. Litan, Robert. 2014 Trillion Dollar Economists: How Economists and Their Ideas Have Transformed Business. New Jersey: John Wiley & Sons