Author: The Nation

The Federal and State Governments are waving enabling operational and fiscal environment bait to local and foreign investors. Their re-energised drive to incentivise investors by easing stringent business policies that discourage investment may have rekindled enthusiasm, especially among foreign investors who now see strong prospects of Nigeria becoming an investment destination of choice. However, the investors’ growing enthusiasm may be short-lived amid fears that without first addressing pervasive insecurity and decrepit infrastructure forcing them to hold back, Nigeria may be putting the cart before the horse. Assistant Editor CHIKODI OKEREOCHA reports

After what may have gone down, from several critical perspectives, as Nigeria’s most depressing outing in international trade and diplomacy under former President Muhammadu Buhari’s eight years administration, the country now looks good to reclaim its dominant position in global business, trade and investment. First, it took the recalibration of Nigeria’s global engagement strategy by the current administration of President Bola Tinubu to set the stage for what promises to restore and strengthen the country’s diminished image and influence in global trade and investment. The recalibration of the country’s global engagement strategy, The Nation learnt, was by way of a strategic rethink in favour of a free-market approach to rebuilding Nigeria’s weakened influence in continental and international trade and investment space, as opposed to Buhari’s protectionist approach to economic diplomacy. In line with President Tinubu’s strategic shift towards more intentional, dynamic and value-driven economic relations, he has, in the past six months of his inauguration as Nigeria’s new leader, been literarily crossing the oceans and climbing the mountains in search of countries and investors willing to do business with Nigeria.
Already, the result of the intensified shuttle economic diplomacy by the President, who has since been joined by some state governors equally eager to market the huge but largely untapped investment opportunities in their domain, has been quite evident. For instance, there has been a deluge of business partnership deals, investment and trade collaborations among Nigeria and some foreign countries and investors willing to bring the much-needed investment cash into the country, beginning from Thursday, June 22, when Tinubu embarked on his first official trip to Paris, France. Although, he was in France to participate in the two-day summit for a “New Global Financing Pact,” the President was able to network with International Finance Corporations (IFCs), institutions, countries and would-be investors to open the floodgate of Foreign Direct Investments (FDIs) into Nigeria. Since then, there has been a flurry of activities in the economic diplomacy front, with several other countries including the United Arab Emirates (UAE), India, South Africa, the United Kingdom (UK) and the United States of America, among others coming under President Tinubu’s economic diplomacy radar to bolster greater trade and investment among Nigeria and those countries across key sectors including manufacturing, renewable energy, power generation, infrastructure, health, agriculture, transportation, mining, digital economy and much more.

Waving a business-friendly environment wand

In selling Nigeria to investors, particularly foreign investors, the President and some governors have been dangling the proverbial carrot in the form of enabling operational and fiscal environment to woo investors and significantly boost FDI, increase revenue and create more jobs for Nigerians. For Tinubu and, indeed, the state governors, who have, at various local and international forums declared that it is no longer business as usual about doing business in Nigeria. It is easy to see why throwing enabling business environment bait to investors has become a compelling proposition. Nigeria’s inclement business environment manifesting in unstable government fiscal and monetary policies, unbridled corruption, pervasive insecurity, decrepit infrastructure particularly epileptic electricity supply, policy somersault, multiple regulatory agencies, and asphyxiating tax regime, among others, has often been cited by local and foreign investors as a major reason for holding back. Many of them who could not cope with the prevailing unfriendly business environment in the country have either been forced to shut down their operations or relocate to neighbouring African countries where the operating environment is considered more conducive for their businesses to thrive and a mouth-watering Return on Investments (RoI) guaranteed. The former Minister of Industry, Trade and Investment, Mr. Olusegun Aganga put the impact of the inclement business environment on Nigeria’s renewed push to boost the confidence of the global investment community in perspective when he said one of the biggest determinants of how much investment an economy attracts is the macroeconomic environment. He said: “An environment where inflation is at a record high level, and still rising, exchange rates are high and volatile, and a large percentage of national income is going towards servicing debts cannot foster the kind of stimulus our economy needs.
“There is a need to design a macro-economic framework that will be supervised by a strong macro-economic management team within the economic management team that is accountable to the President.” Aganga, who was also Nigeria’s former Minister of Finance and Chairman of the Economic Management Team, spoke at the 3rd Adeola Odutola Lecture/Presidential Luncheon which was held in Lagos recently, with the theme “Setting the Agenda for Competitive Manufacturing under the African Continental Free Trade Agreement (AfCFTA): What Nigeria Needs to do.” The former minister, at the lecture which was the last leg of activities that marked the 51st Annual General Meeting (AGM) of the Manufacturers Association of Nigeria (MAN), also emphasised the need for the current administration to pay more attention to the ease of doing business, particularly those areas that are not covered or adequately covered by the Ease of Doing Business Survey. While listing some of the areas to include poor implementation of government policies, multiple regulators with overlapping mandates, illegal roadblocks, levies and demands by local communities, and others however said local manufacturers and investors are in a better position to point the government in the right direction. Interestingly, Aganga and other experts’ push for a strong and stable macro-economic environment to woo investors appears to resonate with President Tinubu and the state governors, hence their decision to prioritise the removal of some of the aforementioned obstacles hindering the flow of investments into Nigeria. For instance, it was in a bid to resolve the issue of multiple taxations agitating the minds of businesses and local and foreign investors that President Tinubu established the Presidential Committee on Fiscal Policy and Tax Reforms to remove all barriers impeding business growth in Nigeria. The Committee, chaired by a tax expert at Price WaterhouseCoopers (PwC), Mr. Taiwo Oyedele comprises experts from both the private and public sectors. It will have responsibility for the various aspects of tax law reform, fiscal policy design and coordination, harmonisation of taxes and revenue administration.
For the President, this and other reforms have become necessary if the administration must birth a more competitive economy capable of attracting foreign investors to the boundless opportunities in virtually all the sectors of the Nigerian economy both at national and sub-national levels. Tinubu underscored this thinking when, in Paris, France, he said ongoing reforms, starting with the removal of fuel subsidies and streamlining of the exchange rate, for instance, will be sustained for a more competitive economy to emerge. “We are ready for business, prepared to welcome investments,” he said. That was when Tinubu received the President and Chairman of the Board of Directors of the African Export-Import Bank (Afrexim), Prof. Benedict Oramah and the President of the European Bank for Reconstruction and Development (EBRD), Odile Renaud–Basso in separate meetings, on the sidelines of the Paris Summit for New Global Financing Pact. “Nigeria is ready for global business and our reform is total. We need reforms for national survival, and it would take boldness and courage to reposition the economy,” the President said, assuring the delegation of Afrexim Bank executives that the Federal Government will continue to stimulate the economy with policies that support investments in areas of Nigeria’s competitive advantage, particularly agriculture.
Apart from the aggressive reform of Nigeria’s fiscal, monetary, regulatory and tax policy environment to de-risked the business environment, the federal and state governments are also dangling an incentive akin to a blank cheque to new investors, allowing them to seamlessly bring their money into the country free of worries about whether or not they can take their money out at any point in time. Nigeria’s active participation in the recently-concluded 78th United Nations General Assembly (UNGA) in Washington, U.S.A. also underscored the country’s gradual reintegration into the global arena, with Foreign Affairs Minister Ambassador Yusuf Maitama Tuggar hosting the Nigeria State Luncheon themed “Financing Nigeria’s Growth Agenda.” Also last week, the President, again, assured foreign ambassadors in Nigeria of his administration’s readiness to maintain open lines of communication and cooperation, with a focus on advancing mutually beneficial economic opportunities across sectors.

That was when he received the Letters of Credence of the Ambassadors of Angola, the Kingdom of Belgium, the Kingdom of Norway, and the Bolivarian Republic of Venezuela to Nigeria, Jose Bamoquine Zau, Pieter Leenknegt, Sevin Baera, and Albert Castelar, respectively. In separate meetings with the Ambassadors, Tinubu emphasised the importance of strong diplomatic relations and expressed his willingness to engage with the foreign missions. He told the Ambassadors that the Foreign Ministry and the Office of his Chief of Staff would always be available to interact with the foreign missions and address any matter of concern. “We will maintain an open-door policy. We are ready to do anything that will make your stay rewarding and our relationship strong. Do not hesitate to bring up any matter with the Foreign Minister or my Chief of Staff; they will bring it to my attention,” a statement by Special Adviser on Media and Publicity to the President, Chief Ajuri Ngelale quoted the President as saying. The event, which took place on September 21 at The Madison Main Ballroom, The Lotte New York Palace was coordinated by Nigeria’s Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun. The luncheon served as a platform for fostering dialogue between potential investors and Nigerian leaders, aimed at exploring investment opportunities for Nigeria’s socio-economic development. Before last week’s engagement with the envoys, there has been a barrage of bold, strategic and game-changing economic reforms and policies encapsulated in President Tinubu administration’s Renewed Hope agenda aimed at resetting the economy for sustainable growth. Some of them include scrapping the obnoxious and corrupt-ridden fuel subsidy regime, ditching the fixed exchange rates to allow the naira trade freely at market-determined rates, tackling insecurity and implementing targeted social intervention programmes to cushion the difficult but transient impact of the administration’s essential policy reforms particular the removal of fuel subsidy. The Secretary to the Enugu State Government (SSG), Prof. Chidiebere Onyia gave more insight into some of the irresistible incentives on offer to prospective investors particularly those interested in exploring the myriad of investment opportunities in Enugu State across key sectors such as energy, power and transport, ICT, agriculture, tourism and others. Prof. Onyia, who said the state government, is currently collaborating with the Indonesian Government to foster mutual prosperity, capital flows and diversification of Indonesian industries into the state said the administration of Governor Peter Mbah recognises private investment as a key driver of long-term economic growth and prosperity. The SSG, who spoke at a recent news conference in Lagos to herald the Nigerian Indonesian Investment and Trade Forum (NIITF) 2023 said the governor, being a product of the private sector, understands that investors need an enabling business environment to inject capital. Onyia said: “We know that ease of doing business; infrastructural availability and adequate security are critical to successful investments. We have thus created here in Enugu State a one-stop-shop for the registration of businesses. We intend to make a N2 trillion investment in infrastructure in our state in the next four years.” Continuing, Prof. Onyia said: “We have also begun tackling significant issues with the business enabling environment under the direction of the World Bank State Action on Business Enabling Reforms (SABER). “We are also reviewing the state’s land administration and land investment processes, our Public Private Partnership (PPP) policy frameworks and services for investment promotion. “The state has also invested in a GIS platform, and we are currently streamlining the state’s tax and land administration systems. These will ensure that services for investment support are efficient. The NIITF was aimed at showcasing the best of Nigeria’s non-oil produce, driving FDI and increasing the trade balance between Nigeria and Indonesia. This year’s edition of the Forum themed “Rediscovering Business Potential in Nigeria” was held last month in October in Jakarta, Indonesia, after its inaugural edition last year. The President, of Nigeria Indonesian Chamber of Commerce and Industry (NICCI), Ishmael Balogun said the Forum had a very robust lineup of participants both from the public and private sectors from Nigeria and Indonesia. According to him, areas of focus include but not limited to manufacturing, renewable energy, power generation, infrastructure development, health, agriculture, transportation, mining, digital economy and much more.
The Enugu State Government was the headline sponsor for this year’s NIITF event, with Governor Mbah delivering the keynote address. “Our mission is to make Enugu the preferred destination for investment, business, tourism and living in Nigeria,” Prof. Onyia said, at the news conference that heralded the event. In an interview with The Nation, the Enugu State Commissioner for Trade, Investment and Industry, Adaora Chukwu, emphasized that the state’s partnership with the Indonesian Government was based on Governor Mbah’s initiative to raise the state’s GDP from $4.4 billion to $30 billion in the next eight years.
Lagos State eyes Africa’s premier financial centre spot

The Lagos State Government has raised the bar in the aggressive hunt for foreign investors, with Governor Babajide Sanwo-Olu inaugurating the Lagos International Financial Centre (LIFC) Council, on Friday, September 3, to help drive the bold vision of bolstering the position of Lagos as Africa’s premier financial centre. The initiative is a ground-breaking public-private sector collaboration between the Lagos State Government and EnterpriseNGR, a not-for-profit private sector advocacy group that promotes the growth and development of Nigeria’s Financial and Professional Services (FPS) sector as a catalyst for economic development. The LIFC Council so established is charged with providing strategic oversight, guidance, and coordination towards transforming Lagos as Africa’s premier financial centre and investment destination of choice. Sanwo-Olu, who described the LIFC Council as “Transformational,” said it underscored his administration’s unwavering commitment to transform Lagos into a global economic and financial powerhouse that is safe and secure. Members of the LIFC Council are drawn from both the public and private sectors; the Council will collaborate with stakeholders across the federal, state and local government levels, alongside regulatory bodies, to actualise the state’s ambitious vision to become a global economic and financial hub. The Council’s mandate includes advising on measures to attract foreign investment, monitor progress, address identified challenges, and suggest improvements as needed. It has Sanwo-Olu as Chair, and EnterpriseNGR’s Chairman, Mr. Aigboje Aig-Imoukhuede, as Co-Chair of the Council. Beyond inaugurating the LIFC Council with the aim of captivating global investors, unveiling the state’s huge potential as an investment destination of choice, and paving the way for a transformative era of economic prosperity, the governor also announced his administration’s plan to take its ‘Open for Business’ message to the Lord Mayor’s Show in London. The Lord Mayor’s Show is an annual event held in the City of London, United Kingdom, to celebrate the inauguration of the new Lord Mayor, Prof Michael Raymond Mainelli. Sanwo-Olu said the invitation extended to Lagos, the first African city to be so invited to participate at the Show, is a testament of the State’s growing global acceptance and visibility. “The invitation stands as a resounding endorsement of Lagos State’s commitment to excellence, as well as recognition of its increasing economic prominence. Lagos is not just going to London for the parade and pageantry; this visit has a more strategic purpose. This is a prime opportunity to showcase Lagos on a global platform,” he said.
Insecurity may throw a spanner in the works
On the strength of the Federal and State Governments’ focused commitment to reclaiming Nigeria’s once dominant position in international business, trade and investment by de-risking the business environment via reforms to woo investors, the confidence of the global investment community in Africa’s most populous country is gradually receiving a boost. The United Kingdom High Commissioner in Nigeria, Dr. Richard Montgomery, confirmed this heart-warming development, last week when he said Nigeria is fast becoming a regional and global powerhouse, attributing the feat to the various reforms and multi-sector re-organisations initiated by the Tinubu administration. The British envoy, who observed in a goodwill message at the 2023 Cabinet Retreat, organised for ministers, presidential aides, permanent secretaries and top government functionaries, at the Presidential Villa, Abuja, assured Nigeria of the UK’s continued support in the spirit of mutual respect and partnership. Dr. Montgomery, while recognizing Nigeria as a growing regional and global powerhouse, applauded your President Tinubu’s plans to stabilise the economy and put it on a higher growth path to prosperity on which so much else depends. The British envoy projected that Nigeria will likely become the third largest country in the world by 2050.,
But as prospects of Nigeria becoming a choice destination for investment are, insecurity remains a big challenge. In fact, given the current pervasive insecurity across the country, business operators and experts fear that without tackling insecurity, the growing enthusiasm among the local business community and foreign investors may be cut short. Across Nigeria’s six geopolitical zones, insecurity is arguably, the biggest heartache for the authorities and Nigerians generally. And it is also clipping the wings of local and foreign investors, with many companies forced to flee conflict-prone areas.
Geophysicist and Project Manager, Olufemi Adegbulugbe, did not mince words when he said without tackling insecurity that discourages both local and foreign investment and addressing unstable government fiscal and monetary policies, “Tinubu’s foreign trips to seek foreign investment is a case of putting the cart before the horse. It will only terminate in unfulfilled promises and lost hope.”