There are many significant aspects to the recent recalculation of Nigeria’s Gross Domestic Product (GDP), which has nearly doubled in size to become the largest economy on the African continent.  It is worth noting that the country’s film industry, known as Nollywood, had not previously registered statistically. According to the new calculation, it now accounts for 1.4 per cent of GDP.

With stronger enforcement of intellectual property rights, this figure could grow substantially.

Nollywood is the third largest content provider in the world, after Hollywood and India’s film industry, Bollywood. The Nigerian film industry produces more than 2500 movies per year and generates an estimated $600 million annually. It is also estimated that the country’s film industry employs over a million people, making it the nation’s largest employer after agriculture.

The problem is that Nigerian artists derive little commercial value from their efforts.

For the last twenty years, film distribution in Nigeria has been defined by content going from the editing studios directly to sale in the open market via videocassettes and DVDs for two to three dollars per unit. Producing a movie in Nigeria generally costs between $25,000 and $70,000. Production time for an average video-film is often less than two months, from casting to distribution, and the films are profitable for only two to three weeks after release. Most DVD movies easily sell more than 20,000 units, while the most successful sell ten times as many.

Nollywood’s reliance on DVDs has created significant piracy problems. The Nigerian Copyright Commission (NCC) estimates that the country is losing over $1 billion annually to piracy. The World Bank estimates that for every legitimate copy sold, nine others are pirated. Many Nollywood films are also available on YouTube and other Internet sites at no cost.

Nigeria’s films and television shows are seen across the continent and throughout the diaspora. The industry is a source of immense pride for the nation but the film creators are not rewarded commensurately to their skills and talents.

 The NCC has indicated that a new bill would soon be passed into law to begin to tackle digital and on-line piracy in the country. The NCC said that it has received assistance from Microsoft, Google and Multi-Choice.  The World Bank has also established an initiative to combat piracy with the NCC, the Nigerian Export Promotion Council, and the National Film and Video Censors Board.

Stronger enforcement of intellectual property rights can be a valuable instrument of economic development in Nigeria. In taking measures to reduce piracy and to ensure that those employed in the film industry are compensated equitably for their efforts would substantially increase Nollywood’s contribution to the GDP. It would also more fully reflect the industry’s contribution to Nigeria’s cultural influence across the continent.

Photo of Witney Schneidman Witney Schneidman

Witney Schneidman has nearly 40 years of experience working across Sub-Saharan Africa.

Drawing on his experience in the State Department, the World Bank, think tanks and his own consulting practice, Dr. Schneidman, a non-lawyer, has advised energy, technology, consumer and health companies, among…

Witney Schneidman has nearly 40 years of experience working across Sub-Saharan Africa.

Drawing on his experience in the State Department, the World Bank, think tanks and his own consulting practice, Dr. Schneidman, a non-lawyer, has advised energy, technology, consumer and health companies, among others, on projects in more than 30 African countries. He has also served as Deputy Assistant Secretary of State for African affairs, and on the Africa advisory committees in the Office of the U.S. Trade Representative and at the U.S. Export-Import Bank.

Dr. Schneidman provides strategic advice on the varied political, economic, social and regulatory issues that are critical to companies’ success in Africa. This includes issues related to Corporate Social Responsibility, compliance, market entry and risk mitigation. He played a leading role in the passage and recent reauthorization of the African Growth and Opportunity Act and was a delegate to the Global Entrepreneurship Summit co-hosted by President Obama during his visit to Kenya.

Dr. Schneidman chairs Covington’s Africa Practice Group and is a senior member of the firm’s Public Policy Practice Group, the International Strategy Group and the International Trade and Finance Group.