COVID-19: Closing of China device factories ‘impacts Nigeria market’

The closing of China device factories following COVID-19 outbreak has triggered declines in the Nigerian consumer technology market, according to a new study.

The latest International Data Corporation (IDC) Middle East and Africa (MEA) personal computing devices (PCD) market, which is made up of desktops, notebooks, workstations, and tablets, reports shipments decline 10.2% year-on-year during the first quarter of 2020.

Nigeria, a key market with booming for consumer technologies, just like other MEA markets, recorded declines primarily caused by supply shortfalls because of the closing of China device factories, the report suggests.

IDC’s report just as Ikeja Computer Village recently lifted the shutdown on Nigeria’s largest technology market with restrictions to check the spread of the deadly COVID-19 virus.

Mrs Bisola Azeez Isokpehi, the Iyaloja of Ikeja Computer Village, told Technology Times in a recent interview that the market management board decided to reopen the market, but in line with Lagos State Government’s rules to check the spread of the deadly virus.

Meanwhile, IDC’s latest quarterly personal computing devices (PCD) Tracker shows that a total of 4.4 million units were shipped across the region in Q1 2020, which is the lowest volume since Q3 2009.

‘COVID-19 causing closing of China device factories’, IDC says.

“The primary reason for this decline was the outbreak of the COVID-19 virus, which led to the closure of several factories in China and caused a shortage of supply across the region,” Fouad Charakla, IDC’s senior research manager for client devices in the Middle East, Turkey, and Africa says.

“The lockdown measures that were subsequently implemented across the region led to a significant slowdown in both business activity and end-user demand. As a result, almost all countries in the region experienced a decline in PCD shipments year on year”, Charakla says.

“With widespread work-from-home policies enacted by organizations across the region, many employees had to be equipped with notebooks to facilitate their ability to work remotely. As a result, the demand for notebooks suffered less than the demand for desktops, as many organizations requested for their desktop orders to be changed to notebooks. Similarly, with schools closing down, there was a slight surge in demand for notebooks and tablets in some parts of the region to facilitate remote learning”, the IDC exec says.

In the PC segment, the top three vendors maintained their rankings. Despite suffering a sharp decline in shipments year on year, HP continued to lead in terms of market share. Lenovo achieved some growth in shipments, while Dell experienced a downturn, according to IDC.

In the tablet space, backed by the large-scale education delivery in Egypt, Samsung maintained its top position. Huawei ranked second, while Apple came in third.

“The future holds much uncertainty as a lot depends on how quickly the spread of the COVID-19 virus itself can be controlled,” Charakla says. “However, given the prevailing conditions, IDC expects PCD shipments for Q2 2020 and the rest of the year to be further impacted by the pandemic-induced slowdown, with the year 2020 expected to suffer a considerable decline in shipments.

“Oil prices, which have also suffered tremendously, will significantly impact the GDP of many countries in the region, especially the Gulf. This will inevitably lead to tighter spending on government-led initiatives. However, the easing of lockdown regulations now taking place in many parts of the region should prevent any further alarmingly sharp declines at the regional level.”