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Nigeria, still the next investment destination

CONTRARY to what many people are think­ing and saying, Nigeria is still a hopeful prom­ise positioned to be the bastion commerce and industry. Nevertheless, Nigeria, one of the fast emerging markets, is a country full of astonish­ing contrasts in the midst of its enormous natural and human resources. Besides oil and natural gas, the country is opulently endowed with a va­riety of solid minerals of various types, as well as industrial minerals such as gypsum, barytes, kaolin and marble. Nigeria’s economy, once con­sidered lethargic and bifurcated, is now roaring back with investment opportunities because of government’s reform agenda. At least, that is the perception of most Nigerians here, who are mak­ing preparations to relocate to invest at home.
Nigeria’s attractive business climate did not come without synergic reforms that are currently being executed by the government. Some of the reforms and policies have yielded results that prompt those abroad to take the country seriously as an investment heaven. For instance, not only that signing into law the Nigerian Oil and Gas Industry Content Development Bill 2010 (Local Content Bill), which has increased Local Content in the Oil and Gas sector, but has also resulted to the Royal Dutch Shell awarding about N7.8 billion ($49.9 million) contract to a Nigerian firm, S.C.C Limited, for the manufacture of high pressure line pipes that would otherwise have been awarded to a foreign firm. Similarly, Exxon Mobil awarded an off shore platform contract to a local firm, Ni­gerDockNig PLC that would otherwise have been awarded to a foreign firm, as a result of the law.
Equally, the launching of the Sovereign Wealth Fund (SWF) with a seed capital of $1 billion in ad­dition to creating the Nigeria Infrastructure Fund, the Future Generations Fund, and the Stabiliza­tion Fund as the pillars to the SWF was palatable to economic growth. Likewise, the Public Works Women and Youth Empowerment Program, an in­tervention program designed to employ thousands of youths in the year 2012 with about 30% of those jobs reserved for women would help reduce pov­erty and assure a healthy workforce from a seg­ment of the population must vulnerable. These residuals will continue to spur more economic activities in some vital sectors regardless of who is the president. In most cases, benefits of economic policies outlast the initiator.
More importantly, the past quest to diversify the economy by reviving the textile industry through “the 150 billion Naira Textile Industry Bailout” added growth to the economy. It is noted that the policy has resulted in rising exports from non-oil industry, which stands at “$2.3 billion.” The eco­nomic activities in this industry caused Nigeria’s foreign exchange reserves to consistently rise faster than in the past. Thus, Nigeria’s GDP grew consistently, registering a record growth since last quarter of 2010 and placing the country as the fourth fastest growing economy in the world. Suffice to note that in 2011, based on the improve­ment of economic indices of Nigeria, Fitch Rating Agency revised Nigeria’s economic outlook to stable. However, Standard and Poor’s, a rat­ing agency, generously revised “Nigeria’s rat­ings from stable to positive.” Also, recently, Jim O’Neill, a former Chairman, Goldman Sachs Asset Management, a consulting firm, said “What you are seeing today is the list of the 15 largest economies by 2050 and Nigeria is there. This means that Nigeria can be the 15th largest economy by 2050.”
A few years ago, the National Planning Commission (NPC), the coordinating arm of the country’s economic planning, was credited with carefully and strategically implementing Nigeria’s economic policy, resulting in placing the growth of the country’s economy in the up­ward trajectory. It has been proven that the fed­eral government had established “a specialized department of Monitoring and Evaluation in the Commission to pave the way for improvement in the welfare of the citizenry and promote trans­parency and accountability in public office.” Thus, standardized performance indicators were developed for the evaluation of the effectiveness of ministries, departments, and other agencies, as well as monitor the efficacy of government policies, programs and projects. The indicators seem to allow both government and the public to evaluate performance and effectiveness of min­istries thereby improving the economy of the na­tion.Promoting Nigeria as the best destination to invest, it is imperative for those in the Diaspora to consider investing in Nigeria massively. If Nigerians in the Diaspora increase the level of economic activities in Nigeria, that would be an incentive for non-Nigerians to have confidence in the country. Some prominent Nigerians have effusively encouraged Nigerians in the Diaspora to consider Nigeria as their primary investment destination.
I had a phone conversation with Ambassador Geoffrey Teneilable, former consul-general of Nigeria in Atlanta, Georgia, USA. Before his recall, he implored Nigerians in the Diaspora to invest in Nigeria. “We call upon Nigerians not only in the consular district, but on over two mil­lion Nigerians in the United States to see Nigeria as an investment destination over, above and beyond remitting money for the welfare of fami­lies, school fees payment, and other personal issues,” he began. “We appreciate the substan­tial nature of the remittances from Nigerians in the Diaspora world-wide, which in 2012 alone amounted to about $22 billion; the significant proportion of the amount came from Nigerians in the United States,” he added. “We want Nige­rians to go to Nigeria as investors,” he continued. “They should advise their partners, friends and friends of Nigeria to similarly do so as investors because Nigerians have the requisite expertise skills, entrepreneurship, and sometimes the capi­tal to do so,” he continued.
Teneilable assured, “There are huge oppor­tunities in several areas, including agriculture, infrastructure, hospitality, healthcare, education, waste management, energy and power, oil and gas, among others.” “There are lots of incentives and the return on investment is very encourag­ing and far higher than what you could get in the United States. Government is also making a number of efforts to improve the business cli­mate, including the establishment of the ‘One Stop Shop’ for business registration, improve­ment of the competitive environment to bring it up to international standard and a lot more to attract foreign investment.”
Nevertheless, security is still the big elephant in the room. The federal government has to tackle the issue. In some areas, I have read that kidnapping is on the rise. The incidents of kid­napping discourage many Nigerians in the Di­aspora.