'Beer wars': big brewers target Nigerian drinkers

InBev plant manager Tony Agah holds a bottle of Trophy beer at the InBev beer factory outside Lagos, in Ogun State. 

InBev plant manager Tony Agah holds a bottle of Trophy beer at the InBev beer factory outside Lagos, in Ogun State. 

LAGOS - Gigantic billboards advertising beer now dominate the skyline of Nigeria's megacity, Lagos, signalling the escalating battle between multinational brewers for drinkers in Africa's most populous country.

So far it's a largely untapped market, with Nigerians consuming on average just nine litres of beer a year, well below South Africans' 57 litres, according to market research firm Euromonitor. 

But with more than half of Nigeria's 190 million people aged under 30 -- and the population expected to grow to 410 million by 2050 -- the world's biggest beer companies are looking to elbow in.

For years, Nigerian Breweries has dominated the sector with brands including Gulder, Star and top-of-the-range Heineken.

However, its iron grip on the market is under threat from mega-brewer Anheuser-Busch InBev.

It recently opened a new factory outside Lagos and launched Budweiser to face off against Heineken, in a fierce contest for millennial drinkers being played out across Africa.

Promotions have become an arms race among the beer companies as they host concerts, fashion weeks and boat parties to win over customers.

Restaurant and club owners say they are being courted by the beer companies with unprecedented amounts of cash.

"The big guys started noticing there was a new sheriff in town," AB InBev plant manager Tony Agah told AFP. "It's the beer wars."

Yet the biggest constraint in the eyes of executives isn't infrastructure but erratic government policy. 

Two years ago, there was a severe dollar shortage after the price of oil tanked and Nigeria tipped into a recession.

At the height of the crisis, the government decided to introduce a currency peg, making matters worse for multinationals who have to import many raw materials.

Add to that arbitrary rule changes and a tangle of red tape and you have what Nigerian financial journalist Ugo Obi-Chukwu described as a "regulatory onslaught".

But for all the headaches, the promise of Nigeria is too great to pass up. 

"The thing about the Nigerian market is that, long term, there are huge opportunities," said Nigerian Breweries marketing director Emmanuel Oriakhi.

"There is a massive homebrew category with people making all sorts of alcohol in their backyard, beer is an opportunity to premiumise their experience."