- Nigeria’s economy, large population good for investors
Vice President Kashim Shettima has emphasized the need for African economies to start adding value to their production to step up to the secondary scale, which turns materials to manufactured goods.
Shettima, who laid the emphasis during the African Economy of Scale Plenary on the sidelines of the ongoing World Economic Forum (WEF) in Davos, Switzerland, regretted that African trade was still hovering around three per cent of world trade.
He implored African leaders to work towards ramping up the total $3.1 trillion Gross Domestic Product (GDP) of countries on the continent amounting to a paltry three per cent of the overall global GDP.
According to a statement issued by Senior Special Assistant to the President on Media and Publicity, Office of the Vice President, Stanley Nkwocha, Shettima said “the total Gross Domestic Product of African countries taken together is barely $3.1 Trillion, which is less than 3% of world GDP.
“African trade still hovers at 3% of world trade. These indices must be reversed and ramped up. I believe this is one of the key concerns of Africa Economy of Scale.
“It must be borne in mind that African economies are still largely primary and basic in nature, with considerable dependencies on the global economy. Most countries on our continent are still known for their export of raw materials, minerals and food crops.
“Also Shettima said Nigeria is on the right path to becoming their delight, citing the country’s enviable position as Africa’s largest economy and ongoing efforts of the Bola Tinubu administration to diversify the economy, as outlooks.
According to a statement issued by Senior Special Assistant to the President on Media and Publicity, Office of the Vice President, Stanley Nkwocha, Vice President Shettima stated this at a forum to welcome investors to a parley with Nigerian officials on the sidelines of the ongoing World Economic Forum in Davos, Switzerland.
Sen. Shettima said the President Bola Ahmed Tinubu administration is on a drive to “bring in the entire ecosystem of investors, from private equity players, to venture capitalists, impact investors and competent contractors from all over the world to partner with us in this quest.”
On the potentials in the country as a major attraction for investors, the Vice President said, “Nigeria occupies an enviable position as the continent’s largest economy and with the largest population. Nigeria is currently repositioning her economy away from crude oil dominance, with deeper footprints in technology, arts, culture, creativity and industrialisation.
“Recent developments in our energy sector portend that Nigeria is leading the region in energy security and energy transition. International and domestic energy companies are already engaging the global community and subscribing to the innovations of the future”.
Sen. Shettima maintained that Nigeria remains open to engage with willing nations on mutually beneficial and sustainable terms, underscoring why the countries a reference point for best global practices.
“We have our export, Dr Mrs Ngozi Okonjo Iweala heading up the World Trade Organisation, meaning that Nigeria must show to be a shining example in the best global trade practices.
“Recently, Nigeria removed the infamous 43 trade items from foreign exchange ban, opening up the space entirely, in what is actually a very bold move, signifying full trade liberalisation,” the VP noted.
On efforts by the Tinubu administration in ensuring a conducive environment for investment, VP Shettima said, “Nigeria also totally liberalised the downstream petroleum sector, removing the burdensome subsidies and also we instituted a market-driven foreign exchange market, which outlawed multiple exchange rates in the economy.”
He said the country intends to participate fully in the Global Value Chains (GVC) at many levels, aiming for good value capture as it becomes even more relevant to global supply chains.
He listed priorities for the country to include “repositioning our energy sector, investing in major infrastructure like our rail system, roads, new seaports, and digital technology for our vibrant youthful population to engage the world.
“Nigeria also targets a $1 Trillion economy within 8 years and this requires that we grow our economy in leaps and bounds. A new era of accountability and productivity is being instituted under the guidance of President Bola Ahmed Tinubu.
“Nigeria is an investor’s delight. There is so much to do. So many sectors to engage in. We intend to make the country into a huge construction site in a matter of months. We have rejigged our revenue administration, and will soon match up with some of the most efficient countries in the world”, he said.
Sen Shettima also spoke about the emergence of new sectors such as the Blue Economy, Digital Economy, Steel sector, Gas Subsector, and Alternative Energy, among others.
In the same vein, Vice President Shettima has said under President Bola Ahmed Tinubu a lot is being done to reposition Nigeria’s image, tackle remaining pockets of insecurity and project Nigeria to the world.
He disclosed this at an event to celebrate Nigeria’s cultural richness and diversity on the sideline of the ongoing WEF in Davos.
The VP said, “Nigeria’s diversity is her strength. We have over 300 different languages. Each culture has something to learn from others. And something to teach.”
Meanwhile, Vice President Shettima has said the need to increase intra-Africa trade, currently put at 15%, and its potential to raise the continent’s GDP, are some of the compelling reasons why the African Continental Free Trade Area (AfCFTA) agreement must not be allowed to fail.
He expressed optimism that AfCFTA would help galvanize GDP growth on the continent, just as he said based on the World Bank projections, AfCFTA will increase Africa’s GDP by $450 billion in 2035, and exports by more than 81 percent.
Vice President Shettima spoke at a breakfast event with African Heads of State to launch the Action Plan for AfCFTA on the sideline of the ongoing World Economic Forum (WEF) in Davos, Switzerland.
He said, “African trade is to be boosted by 52.3% by 2025. We should increase these targets and look at the trillions of dollars. African countries need to move quickly to iron out whatever agreements and impediments are remaining to ensure free and smooth trade. Issues around rules of origin negotiations must be completed.”
To achieve set objectives, VP Shettima suggested that “information sharing with private sector players must be optimized and prioritized,” even as he said trade is a private sector imperative, which governments only facilitate.
He further noted the that “negotiations have turned out to be too slow, with clashes between national and continental priorities, leading to too few consummated deals between countries since January 2021 to date.
“Looking ahead, there is need for speed and cohesion among Africa countries. The idea of AfCFTA must not fail, and there is no room for mediocrity in today’s world,” the VP added.
Citing examples of trade unions in Europe, the Americas and Asia, the Vice President said, “African trade cannot continue to be externalized even though we have increased intra-Africa trade from a mere 7% a decade ago, to about 15% today.”
According to him, while Intra-European Trade is around 70 percent, there is need for African leaders to do a lot better in organically empowering countries on the continent and solving their own problems.
He urged Africa’s private sector players to be proactive in stepping up to the plate to occupy their pride of place in trade on the continent. African economies understand that we must begin to add value to primary products like cash crops and step up to secondary and tertiary product manufacturing.”
In his brief remark at the event, which was held at Kurpark Village, Davos-Klosters, Shettima pointed out that it is for this reason Africa is considered by top analysts the world over as a growth economy in dire need of investments and infrastructure.
He, however, told African leaders that economies of scale “portend the ability to do more” by coming together and forming “a more formidable unit, with a bigger voice and stronger negotiating abilities.”
He urged them to run faster and purposefully to catch up with the rest of the world in eradicating crass poverty on the continent and prove that the continent could be a significant contributor to world productivity that can “integrate better with the rest of the world in an age when Artificial Intelligence and Machine Learning are redefining human interactions and existence.”
