A PESTEL analysis of Coronavirus pandemic and implications on 10 Post-COVID–19 businesses in Nigeria

The World Health Organization (WHO) has described the deadly disease (c) as a pandemic disease and a global health emergency;it was reported to have emerged from Wuhan in China towards the end of December 2019 and has since spread across the world, affecting 199 countries and territories as of March 2020. As at April 15, 2020, Covid – 19 infections had risen to about 1,986,872 while 494,192 people had recovered with 126,834 deaths recorded. The COVID – 19 pandemic has forced organizations and individuals to embrace new practices such as social distance, hand washing/sanitizing and remote working. Governments are reconsidering ways to ensure that their countries are stable by developing and enforcing new economic plans to cushion the effect of pandemic on the general business environment.

What is a PESTEL Analysis?

A PESTEL analysis is simply an acronym for describing the strategic management tool used for scanning the operating environment in order to identify key macro (external) factors that influence an organization or a country. Each letter in the PESTEL analytical framework stands for Political, Economic, Social, Technological, Environmental and Legal factors.

Let us look at the impact of COVID-19 on the political, economic, social, technological, environmental and legal factors in Nigeria.

Political Impact

1. Weakened governance capacity

2. Suspension of direct diplomatic relations

3. Delayed signing of bilateral and multilateral agreements

4. Prevent governments and their agencies from discharging direct oversight functions because of fear of infection and death.

Economic Impact

1. Shutdown of business activities

2. Inflation and hike in prices

3. Cut-off of supply chain

4. Fall in oil prices

5. Reduced income from taxes including VAT.

6. Disruption of business activities.

7. Temporary unemployment and permanent loss of jobs

8. Loss of revenues for daily income earners.

Social Impact

1. Shutdown of places of worship

2. Shutdown of recreation centres

3. Compulsory observance of social distancing including self-isolation

4. Evolving new ways of social and cultural interactions

5. Disruption of weddings, concerts, sports, conferences, parties and other social events.

6. Restriction on freedom and social liberty of people

7. Emergence of new ways of greeting and strange social interactions.

Technological Impact

1. Widespread E-activities, E-governance, E-commerce etc

2. Increased relevance of ICT softwares and applications

3. Increased online social interaction

4. Increased acceptance of online education and training for students

5. Emergence of forced online Communities.

Environmental Impact

1. Increased environmental awareness for the people

2. Growing concerns about personal hygiene by the people

3. Increased used of sanitizers and disinfectants

4. Proliferation of dangerous substances in the public domain as sanitizers and protective masks.

5. The earth is heavily abused with toxic materials, pollutants and life-threatening biological weapons.

Legal Impact

1. Curtailed fundamental human rights

2. Delayed dispensation of justice

3. Increased use of force on people

4. Close down of courts

5. Inability to conduct due diligence on legal aspects of businesses

6. Forced decongestion of prisons/amnesty.

At this period, the enterprise owners and CEOsneed to practically reflect empathy, resilience, optimism, and flexibility in the running of their businesses because “those who survive are not the strongest or the most intelligent, but the most adaptable to change.”

From critical incidents analysis, the Ten Post-COVID-19 Businesses in Nigeria would be the following:

1. Online Learning & Management Systems

2. Disaster & Emergency Consultancy

3. Health Care Delivery Services

4. Industrial Cleaning and Laundry Services

5. Food Technology and Production

6. Agriculture/Farming of all types

7. Food, Products and Services Delivery Value Chain Businesses

8. Real Estate Businesses

9. Hygiene Products manufacturing

10. Corporate Private Cab Services

The predicted economic recession after COVID-19 will have the following impacts:

1. Value of Naira would crash and is crashing already

2. Savings of ordinary people will vanish because they will keep on withdrawing their money for food and basic things of life that are already inflated.

3. Investment in stocks will crash as rational investors will desert the stock exchange for more predictable investment options.

4. One of the best investment options is to keep idle money in dollars as a hedging option.

5. Buying government bonds is also a secure investment, but it is interest-based.

6. Finally, this is a good time to buy properties or put huge investment into real estates for people with long term investment orientation. For basic survival, most people that are desperate to make ends meet will sell their lands and property.

IN CONCLUSION

The lockdown foisted on the world necessitated by COVID-19 has provided the entire humanity a unique opportunity for a reunion with God spiritually, socially, economically and politically. The existential threat of the virus has re-emphasized the dire need for humans, businesses and countries to live peacefully.

I therefore, urge all Nigerians to adhere strictly to the movement restrictions, social distance order and follow guidelines stipulated by the Federal Ministry Health, Nigeria Centre for Disease Control (NCDC) and other relevant health agencies of government to curb the possible spread of the deadly virus in Nigeria. And I also commiserate with those affected by COVID-19 while wishing them quick recovery and wishing the world scientists quick discovery of an antidote. It is my wish that we stay safe and indoors while we deliver humanity out of this difficult time victoriously. Difficult times don’t last long, tough people do and we will all celebrate. There is light after the tunnel. It will soon be over and we will soon be merrier.

Thank you and God bless.

Afeez Ismaila

Managing Director, Mutual Capital International Limited

Central Business District, FCT – Abuja

Mobile: 08082953148

Email: afeez.ismaila@mutualcapital.org

A PESTEL analysis of Coronavirus pandemic and implications on 10 Post-COVID–19 businesses in Nigeria