The article opens with a dramatic excerpt from two conversations symbolic of grassroots economic experiences in two Nigerian families in different part of the same state. One, a victim of the lockdown, the other, a victor. It proceeded tof give a synopsis of events that depicts the structural changes in the economy heralded by the lockdown consequent upon the advent of the Coronavirus. It further explicates on the Schumpeterian changes (which it tagged as Schumpeterian virus) that is shifting the economy from offline to online mode. In the face of these growing urgency for change, it ended with the clarion call for new as well as old entrepreneurs to digitize in order to move on with the sail and remain viable in the long run.
I. Mr. Jamiu’s wife just hissed at him. He stepped out into the frontage of his house at Marina, took out his Tecno Camon i4 phone and dialed a number. The buzzing sound could be heard faintly. At the other end the call was picked. Mr. Jamiu’s voice bellowed,
“It is Mr. Jamiu your friend in Lagos. How is family sir”.
He paused a while to listen to the reply from the other end.
“Ok. Please, I don’t have much credit, I am calling to know if I can get any amount from you”.
“I have not been paid due to the lockdown. In fact, I just gave my wife the last 500 Naira left on me”.
II. Mr. Chigozie just stepped out of his austere apartment into his backyard to enjoy the cool breeze rushing from the Ajah-Lagos part of the Atlantic beach. He met his neighbor Mr. Sanya reclining on his cane chair. After exchanging pleasantries, Mr. Sanya ask about his wife and the conversation ran thus:
Mr. Chigiozie: Hmm, you too have notice that my wife is scarce a-bi!
Mr. Sanya: Yes! Yes! Hope there is no problem?
Mr. Chigiozie: No-o! Madam have turn to lockdown business mogul-o
Mr. Sanya: How? In this lockdown? Is she still going to shop?
Mr. Chigiozie: Hmm. Let me tell you something
Mr. Sanya: Ok. I am all ears
Mr. Chigiozie: Do you remember all those food items she used to sell?
Mr. Sanya: Yes. What about them…?
Mr. Chigiozie: Exactly, she has open her shop online, where she receives order from her customers and send it to their houses through dispatch riders and they credit her account.
Mr. Sanya: O-o-o-ok! That is cool o-o (he nods his head). Wise woman!
Mr. Chigiozie: She has been the one sustaining the family during this lockdown. In fact, she prays daily that the lockdown should continue.
The two conversations paints the graphic reality of firsthand experiences of the victors and victims of the lockdown economy in Nigeria during the ongoing global pandemic of the Covid-19. While the first, is a sad portrayal of the varnishing business and work life, the second, depicts the haunting prospect of that which is fast succeeding it. Could this be what Barry Eichengreen, The Prospect Magazine Columnist called the “Schumpeter’s Virus”? Well, I think so. It was in the aftermath of the Great Depression when the Austrian Economist, Joseph Schumpeter published his magnum opus, Capitalism, Socialism and Democracy, in which he adumbrated on how innovations eventuates in economic cycles of boom and burst, which characterize every economy undergoing a transition. The current succession of events as shown that as the new strain of the Coronavirus shuts in the individual physically from the rest of the world, the Schumpeterian Virus is busy building invisible mazes of neural network of digital platforms in which individuals can perform contactless interaction and value addition within the comfy of their cozy bedroom.
On the 1st of April 2020, the Nigerian cashless policy was roll out by the CBN nationwide. Commercial banks started notifying client of this new development in payment system way ahead of this set date. Since the introduction of cashless policy in 2013 the recent spike in online transactions, with NIBSS instant payment (NIP) and 135 million transactions in March alone this year is unprecedented. This is more than 12% increase in transactions compare to that of the month before. Recently, the American online communication giant, Zoom Video Communication recorded a surge from 200 million users in April 1st to 300 million users in April 21st, 2020. A 50% increase within 3-week and this upward trajectory has being growing to what is now called the “Boom of Zoom”. On the education front, the online education ecosystem is growing in an alarming rate, with many parts of the world, including Nigeria seeing a shift from the four-wall physical classroom model. Even though the challenges are enormous, it is quite clear that the global pandemic have totally disrupted our traditional education systems and it becomes inevitable that we should explore it to its full potentials. Major world economies are considering issuing the digital currencies, with China leading the pack with her recent roll-out of official digital currency in April 2020. The governor of the People’s Bank of China, Yi Gang, in his statement stated that it will fast track her move into the digital economy and enhance safety in a pandemic like this. These are few snippets of the changing face of the world economy consequent upon the lockdown imposed around the globe.
In his recent article in the Wall Street Journal, the U.S. grand master of diplomatic strategy and former Secretary of State, Henry Kissinger, stated that “nations cohere and flourish on the belief that their institutions can foresee calamity, arrest its impact and restore stability”, this is quite unlikely for developing nations. He stressed further that, “when Covid-19 pandemic is over, many countries’ institutions will be perceived as having failed. Whether this judgment is objectively fair is irrelevant. The reality is the world will never be the same after the coronavirus”. This last sentence drive home the sad truth, that our conventional way of life will be upended as large chunk of economic activity will now rest on the digital grid of broadband infrastructure. Business models will be reviewed, downsizing where necessary, and reinventing to furnish consumers need irrespective of geographical locations. The extent of adaptability to these new normal will determine the long term viability of such models. As entrepreneurs’ grapples with these new reality, it becomes absolutely imperative to evolve from analogue to digital entrepreneurship or be face with existential threat. Perhaps, the Schumpeterian Virus that is fast invading our economy as the Coronavirus ravages our bodies, will accelerate the shift to digital economy in most Africa countries, which hitherto have been laid back.
At this juncture, I personally commend the Nigeria government on the re-christen of Ministry of Communication as Ministry of Communication and Digital Economy, an ab initio recognition of where we ought to be. However, it must go beyond mere, nomenclatures to rally all stakeholders in revamping and overhauling the system to make digital entrepreneurship thrive. The 2019 World Bank Digital Economy Diagnostic Report was quite revealing. It underpins a successful digital economy on key foundational elements such as Digital infrastructure, Digital platforms, Digital financial services, Digital entrepreneurship and Digital Skills. The document proceeded further to state that in a digital economy, the manner in which economies of scales are achieved with online deliverables is at a negligible marginal cost, which I believe every shrewd entrepreneur will welcome. Benchmarking the Nigerian digital economy, ranks Nigeria in 2017 in 143rd position amongst 176 countries in the ICT Development index (IDI). In spite, of several shortcoming in the country, it demography of large, young and entrepreneurial mass offers a vast prospect of opportunities to the discerning digital entrepreneur. Reinventing the wheel is not the right option, rather, a careful adoption of already existing platforms, through collaborative effort to create a homegrown solutions that cater to the local consumer should be explored. I see an upsurge in Sourcing. From Home-sourcing with the recent proliferation of Work from Home (WFH) order, to massive Out-sourcing and Crowdsourcing. Entrepreneurs should see the pandemic as a means to evolve, innovate and grow. As nations are recovering from the economic tailspin inflicted by Coronavirus, the deep imprint of Schumpeterian virus it leaves in its wake will continue to linger for a long while, digitize and stay alive!
• Nian, Yao (May 2020) China’s digital currency takes shape amid COVID-19, benefits for foreigners -2020 CGTN Beijing ICP Prepared no 16065310-3
• Kissinger, Henry (2020) Henry A. Kissinger: The Coronavirus Pandemic Will Forever Alter the World Order-Wall Street Journal-March 2020
• Eichengreen, Barry (May 2020) Schumpeter’s virus: How “creative destruction” could save the coronavirus economy-Prospect Magazine-May 26 2020
• World Bank Group (2019) Nigeria Digital Economy Diagnostic Report (DE4A). Washington, DC: World Bank. License: Creative Commons Attribution CC BY 3.0 IGO
• Olisah, Chike (2020) Zroom daily users rise by 50% in 3 weeks due to coronavirus outbreak