The struggle to tame Africa’s beast of a megacity

The struggle to tame Africa’s beast of a megacity

2:00am EDT

By Tim Cocks

LAGOS (Reuters) – A walk along the two kilometers of light rail that Lagos authorities have managed to build in three years gives a sense of how hard it is to impose order on one of Africa’s most chaotic cities. From either side of the concrete structure – no track has yet been laid – the crowded slums and highways of Nigeria’s lagoon-side commercial hub teem with activity. Its trademark yellow buses overtake, undertake and force their way down impossibly narrow side streets, where women stir pots next to canals clogged with rubbish. With between 15 million and 21 million people – the upper estimate is the official one, though no one really knows – and generating a third of GDP for Africa’s second biggest economy, Lagos has become almost as alluring to yield-hungry investors as it is to the 4,000 or so economic migrants who turn up each day.Violent crime, mushrooming slums, police extortion and widespread fraud have often held investment back, but in the past decade, authorities have started trying to tackle some of the obstacles, especially maddening traffic bottlenecks.

“Just keeping Lagos roads moving without rail, pushing that kind of tonnage just through our road network, now that’s the eighth wonder of the world,” says Governor Babtunde Fashola.

Fashola and his predecessor, Bola Tinubu, have tried to turn the city from a byword for squalor into a glitzy business hub. Their success will rest on projects like the light rail, which has involved massive and controversial slum clearance.

If they manage, it could become an investment hub in Africa and a model for fast-urbanizing African nations. If not, it might face a dystopian crime-ridden future not unlike its past.


If Lagos were a country its GDP would make it Africa’s seventh biggest economy – more than twice the size of Kenya’s. Its large consumer market is already well established for firms like Unilever, Heineken and Nestle.

One of Africa’s biggest stock markets sits here, as does its second biggest market in government bonds. Industry is hampered by poor power generation, but the service sector is booming.

Lagos accounts for more than half the non-oil economy of Africa’s leading energy producer, says economist Paul Collier, who sees it as key to breaking the country’s dependence on oil.

“Lagos is Africa’s best chance of a productive megacity,” he wrote in The Plundered Planet. “As oil runs down and is replaced by a new economy … Nigeria’s economic future lies in Lagos.”

But it faces a daily challenge just trying to keep up with the pace of population growth, much of it on the edge of water.

Nigeria, already pushing 170 million people, will be home to 400 million by 2050, making it the world’s fourth most populous country, according to the global Population Reference Bureau (PRB). Lagos will have roughly doubled in size by then, Fashola and demographers agree.

On top of Nigeria’s high birth rate, there is migration.

“The more successful Lagos is, the more people it attracts. That’s the Catch-22,” said Kayode Akindele, partner in a Lagos-based consultancy. “Social services can’t keep up.”

Fashola’s planning commissioner Ben Akabueze thinks Lagos could have 35 million people by 2025 on current growth rates. In 1970, authorities say, there were just 1.4 million Lagosians.

“We can’t stop them from coming,” Akabueze told Reuters from his office in mainland Lagos’s noisy, heaving Ikeja district. “There’s been a net positive migration almost on a daily basis.”

To try to cope better, the government is rolling out a compulsory residents’ registration. “Everybody is welcome,” Akabueze says. “But we want to document the people who stay.”


The influx puts pressure on inadequate housing, and spawns unemployed youths with few options for making a living outside the street gangs – the infamous ‘area boys’ who informally control territory and extort money from passers by.

But the biggest headache is travel. The transport authority says there are 9 million road trips a day in the city. Some Lagosians get up at 4.30 a.m. to make the office by nine.

Things are improving; highways were widened and police stationed at bottlenecks. New ferry services now beat traffic by crossing the lagoon in a state one fifth of which is water.

Tutu Adewale, an assistant to a financial professional, used to spend three or four hours each way commuting by bus along a tangle of bridges. Now it takes her 45 minutes by boat.

“I made do with it, but it’s such a relief now,” she said.

The $2.5 billion light rail project will take more time. China’s state-owned China Civil Engineering Construction Corporation (CCECC) began work in 2010, but there are still 25 km left to build on the $1.3 billion east-west line, and no work has started on the 35 km north-south one.

The project is behind schedule because there is barely a stretch of land on which someone isn’t living or trading.

Thousands of illegal settlements erected by slum dwellers have been destroyed this year. No one has been compensated, because they were never supposed to be there to begin with.

Amnesty International in August condemned the eviction of 9,000 residents of Badia East and the razing of their homes in February, leaving many to sleep in mosquito-infested streets.

In one incident, 72 traders from the Igbo ethnic group were deported to their ancestral lands after their houses were bulldozed. That appeared to give slum clearance an ugly ethnic dimension, and Fashola made a reluctant public apology.

“My shop was just right in front of that bridge,” said Igbo trader Uche Okonkwo, 43, surveying the wreckage of a market trashed to make way for the rail. “They demolished the warehouse, the shops, the offices, the showroom, everything.”


Fashola’s defenders say slums have to be removed if projects like the light rail are to happen, but critics say the heavy-handed approach shows a lack of sensitivity to the poor.

The governor is fixing the city for the besuited business types, they say, but has been slow on things like low-cost housing to help those sleeping under bridges or on rubbish tips.

“Much as I admire Fashola, I don’t see enough being done to help those at the bottom,” blogger Tolu Ogunlesi told Reuters in a chic art cafe in the prestigious Victoria Island, an area housing one the world’s highest concentrations of millionaires.

“They’re talking about building 1,000 low-cost housing units a year, but we need hundreds of thousands a year,” he said.

There’s no shortage of housing projects for the rich. Moss-dusted colonial-era houses in leafy Ikoyi district are becoming rare as they get torn down and swapped for luxury flats.

At Bar Beach on the Atlantic Coast, tonnes of sand is being poured into the ocean to reclaim it for the proposed Eko Atlantic city, a Dubai-style gated community that will have chrome skyscrapers, business parks, palm trees and a marina.

Being on water is the only thing it will have in common with the Makoko slum a few miles away, where 100,000 fishing people live in houses on stilts with no sanitation.


At his desk piled high with papers, Fashola resents the notion he has neglected the poor. He points to projects like massive mains water provision, which will when finished provide 10-20 liters a day to Lagosians, even if the city swells to 35 million, he says.

But the state’s message is: if you leave the poverty of your village to live on the streets in Lagos, that’s your lookout.

“If you have nowhere to stay, then stay in your village. You can’t simply jump on a bus and come live under a bridge,” Akabueze says.

The governor has won praise for dealing with crime. Many area boys have been co-opted – some as yellow-shirted traffic cops, while others keep order in bus terminals.

Violent crime has steadily fallen since he took office in 2007, though there was been a spike in kidnapping this year.

“There was a time security was a big problem, especially robbery, but you have to hand it to them, things got a lot better,” said Lagos tycoon Tony Elumelu.

Many fret about what will happen when the governor steps down in 2015.

“Everything Fashola’s done can easily be reversed. You’d just have to do nothing, it would be reversed,” said Akindele.

Yet a growing number of business people feel the state’s efforts to bring some kind of order to Lagos may be becoming irreversible. Corruption is rife, but institutions function; rubbish is collected, streets are swept, hedges trimmed.

“Lagos is depersonalizing politics,” United Bank for Africa CEO Philips Oduoza said. “Institutions are becoming more important than people, and that could outlast the governor.”

Reinforcing this are rocketing tax receipts; 65 percent of state revenues are now non-oil.

The governor, who gets up at 7 a.m. and works until 3 a.m., says his to-do list isn’t getting any shorter.

“In a football match, the last 15 minutes can be the most decisive,” he says, creaking back in his leather chair. “So I intend to finish with as much pace as we started.”

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (, the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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