- Company expects annual double-digit growth from new Lagos hub
- Probable industries include banking, oil and gas, government
Orange SA’s business-services unit has opened its first sales office in Nigeria as local companies seek to expand outside their domestic market and cut technology costs amid an economic slowdown fueled by the fall in crude-oil prices.
Orange Business Services is aiming for annual double-digit sales growth from its office in Lagos, Nigeria’s commercial capital, Giorgio Heiman, vice president in charge of Africa, told reporters in the city on Tuesday. The unit of Paris-based Orange, which provides about 3,000 customers worldwide with services such as video conferencing that reduce travel budgets, will target banks, oil companies and government departments.
“In Lagos, there is a big potential for companies going global,” Heiman said. “There are companies like banks that go abroad and offer services in many countries without relying exclusively on the Nigerian economy.”
Africa’s biggest economy, which relied on crude for about 70 percent of government revenue and 90 percent of export earnings in 2014, is facing a slowdown caused by a halving of the price of oil over the past two years. Growth will probably slow to 2.3 percent this year from 2.8 percent in 2015, which was the lowest rate in 16 years, according to International Monetary Fund forecasts.
“The Nigerian economy is not only oil,” Heiman said. “We are confident that the Nigerian economy is going to grow strong again.”
Some Nigerian banks, including Orange clients Guaranty Trust Bank Plc and First Bank of Nigeria Ltd., have accelerated their regional expansion in recent years. United Bank for Africa Plc said earlier this month it plans to grow its African footprint from to 25 countries from 18 “in the near-to-medium term.”
The oil and gas industry still remains a major target for Orange as companies seek to boost efficiency and cut costs, said Ababacar Mbaye, sales manager for West and Central Africa. The company is also targeting the Nigerian Ministry of Foreign Affairs’ 88 missions worldwide, the executive said.
The Lagos office will be Orange Business Services’ second in Africa after Johannesburg.