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- To complete Ogun quality control lab to boost agro exports
- says $400m worth of investment expected from AfCFTA
From Juliana Taiwo-Obalonye, Abuja
The Federal Government has blamed the prevailing insecurity for Nigeria’s fall from the top 10 of preferred investment destinations in Africa.
Recall that Nigeria was absent from the top 10 best countries to invest in the continent in the latest Rand Merchant Bank report titled ‘Where to Invest in Africa 2021’.
In the report Egypt came out on top with Morocco and South Africa in the second and third most robust markets for investment respectively.
Notably, smaller nations like Rwanda and Botswana moved up the rankings from position five and thirteen in 2020 to position four and five respectively in the latest index.
Ghana, Mauritius and Cote d’Ivoire came 6th, 7th and 8th respectively, while Kenya and Tanzania were ranked 9th and 10th of best African countries to invest in.
Despite the country’s dropped to 14th position, President Muhammadu Buhari had said the country remains the most viable and attractive investment destination in Africa.
The President while addressing a trade and investment forum at Expo 2020 Dubai, had said Nigeria is on the path of becoming the continent’s leading industrial and trading nation, adding that his administration has made efforts to improve the investment environment.
Reacting to the development, the Minister of Trade and Investment, Niyi Adebayo, who appeared on the 26th ministerial press briefing organized by the presidential communication team at the presidential villa, Abuja, said that several factors including the state of security are responsible.
However, he said, government is doing all that is necessary to return Nigeria to its position.
Asked what is responsible for the fall, he said: “Well, there are various factors. The reason for that varies but the major one being the security problems that we have within the country. And as you’re well aware, the federal government is making every effort to resolve the security problems, so that we will go back to the position of being the preferred destination.
“However, having said this, the feedback that I’m beginning to get lately from some of the people, the foreign governments that I have been meeting is that our position is getting better. Because there seems to be a big interest again in investing in Nigeria. So I’m sure as time goes on, we will begin to see an improvement in that situation.
The reasons for that are various, the major line being the security problem that we have in the country.
“So, I’m sure as time goes on, we will begin to see an improvement in that situation.”
The Minister further disclosed that based on his interactions with foreign investors, their interest in investing in Nigeria has heightened.
He said: “One of the things that we keep harping on is the fact that we have the largest individual population in Africa, we are the largest markets in Africa, of the 1.3 billion African market, over 200 million is Nigeria.
“So, anybody that wants to do business in Africa, we always say you should take advantage of that market. There’s no better place to start than Nigeria, because you have ready market in Nigeria, and Nigeria as a hub, and then spread to other African countries. And that is the message we will take out.”
On how that can be achieved amid insecurity in the country, the minister stated: “It is being sorted out. As you are aware, the federal government is making every effort. We’re buying lots of equipment, we are increasing the size of the police force, they are equipping them, they are equipping the military, they’ve been able to get some attack aircrafts now.
“I’m aware that the army will be buying some helicopters soon. So, a lot of effort, a lot of funds are being put in that direction with a view to resolving the security issue.”
Adebayo hinted that the federal government is willing to provide incentive to investors to invest in insecurity prone areas in the country.
He explained: “And another thing that we’re doing, maybe I should mention this as well, we are looking at when people want to invest, everybody wants to invest in a safe area. So, to make it attractive for you to invest in a place that is not so safe, we will be giving various incentives.
“So, for instance, we invite you and we say come and invest in the northwest, and you say aha! there’s a security problem there. We say, there is no problem. There is security problem. However, if you invest a certain amount of money, these are the incentives that we will give you to enable you go and invest and that is beginning to reap benefit because people are beginning to show interest in that kind of thing.”
The minister revealed that investment worth $400 million is being expected through the Africa Continental Free Trade Area Agreement (AfCFTA), saying: “African Development Bank is in partnership with other banks. I think the Islamic Development, some other banking institutions are showing an interest and I think that the first trade will be about $400 million.”
The minister also spoke on the challenges facing manufacturing in Nigeria and how they can be overcome.
According to him, “Well, one of the major ones is power. As we all know, we have power issues in Nigeria and that is why one of the things that we’re looking at is setting up of these special economic zones, special agro processing zones.
“The whole idea of setting up these processing and industrial zones is that, part of infrastructure that we put in place for those zones will be power. We have roads, we have water, all the things that are required will be put in those places.
“So, all you need to do as a manufacturer is come, lease the place and all the infrastructure you need will be in place that will help to make life easy.
“And one of the things that we’re also doing is to assist manufacturers is in regard to infrastructure.
“We are in touch with the minister of petroleum resources with a view to reducing the cost of gas. Many manufacturers are already generating their own power to power their industries.
“But the cost of the gas that they are asked to pay does not make them competitive. In fact, they pay more than even the companies that generate power.
“So, we are saying to the Minister of Petroleum, that they should sell gas to manufacturers at the same price that they sell to the GenCos. Since they are also generating power, they should be given that opportunity to be able to buy gas at a price that would not make their goods uncompetitive.”
Speaking against the fact that while Nigerians foods exports are rejected abroad and other West African countries’ goods are accepted, he regretted that the damage smuggling is doing to the nation’s economy.
He stated: “You’ll be surprised that those yams that they say come from Ghana actually comes from Nigeria.
“The major problem that we have is one that I did mentioned earlier, smuggling of our goods. A lot of agricultural produce are smuggled from Nigeria, into Ghana and exported from Ghana. You’ll be surprised that even our crude oil is exported from Ghana as crude oil from Ghana.
“So, there’s a lot of problems with that. And these are the areas that government is looking at, with a view to plugging the leakages.
“And why the people smuggle our agricultural produce to other countries to export is because of the problems that we are having with regard to exporting our goods from our own ports, the cost of exporting from of ports, the problems with the infrastructure to ports, the problem with the delay in exporting from our ports.
“And these are issues that I believe a cabinet committee has been set up with a view to resolving these issues so that it will make it easier for us to export goods from here without the attendant costs and delays that exporters presently are faced with. So, that will soon be a thing of the past.”
Meanwhile, the minister said government will soon complete the construction of its quality laboratory, located in Abeokuta, Ogun State.
Adebayo said the completion of the laboratory would boost government’s effort towards exporting more products abroad.
He said: “In order to improve the exportation of agricultural products, my Ministry took to the the Federal Executive Council a National Quality Policy, to make sure that the quality of goods that we produce and we export are of international standard.
“We have partnered with the AFREXIMBANK and the first quality lab that is going to be in operation in Nigeria, I think should be ready by the end of this year. It is in Abeokuta, Ogun State, whereby, Nigerian goods would be put to the quality test and be certified by one of the international inspection agencies and once they get that certification, anywhere they are shipped to in the world, there would be no problem.”
The Minister further disclosed that the country is to establish agro-processing zones in all parts of the country in collaboration with the African Development Bank, where about $400 million would be invested by the bank and its partners.
