Speech Prof. Yemi Osinbajo, Vice President, Federal Republic of Nigeria, at the Direct Investors’ Summit 2018, at Transcorp Hilton Hotel, Abuja, On Tuesday, 22th May, 2018.
It is a pleasure to be here with you at the Direct Investors’ Summit 2018, even though I am catching up only at the end of day 1.
As you already know this Summit is the first of its kind held by the Nigerian Investment Promotion Council (NIPC), and it seeks to highlight and showcase Nigeria’s investment opportunities.
Some of these investment opportunities are obvious, others less so. But I am sure that in the last couple of hours and by the time this Summit ends tomorrow, you would have had a much fuller picture of Nigeria’s promise and potential.
Nigeria’s opportunities are premised on a number of strategic factor endowments: our sprawling arable land, rich mineral investments, our gateway position, not just for West Africa but for all of the African continent. But the jewel in that crown is unmistakable: Our People. A population that is Africa’s largest, and half of the entire West Africa. It is also one of the most youthful populations in the world, with 50 per cent under the age of 20 and 75 per cent under the age of 35; an incredibly energetic and entrepreneurial people. It is easy to see why any global company serious about its future just has to have a plan for Nigeria, as many opportunities abound.
Last December, a cereal factory opened in Lagos to manufacture Kellogg’s cornflakes; the result of a partnership between an American company and Tolaram, a Singaporean conglomerate. Although the Kellogg Company is over a hundred years old, that factory was its first investment in Nigeria. Barely half a year later, they are already talking about expansion plans, as the new factory has already hit maximum capacity.
There are also many successful partnerships between the public and private sectors, perhaps the best example is the Nigeria LNG, a Nigerian run company that liquifies Nigeria’s natural gas for export all over the world and helped Nigeria earn her place as the 4th largest LNG exporter in the world. The Company is majority private-sector owned by three multinational oil companies, while Nigerian National Petroleum Corporation (NNPC) holds a minority stake.
In e-commerce, financial services, retail, manufacturing, the stories of success also abound. MTN is one of the better-known of the private sector examples; the story of its investment in Nigeria is frequently cited in investment circles. Today the company operates in more than 20 countries, but earns more than half its revenues from Nigeria. It is now planning to list on The Nigerian Stock Exchange, where it will create billions of naira in new value for many Nigerians and investors from anywhere else in the world.
Ladies and Gentlemen, central to any conversation about investment in Nigeria is the nature of our business environment, the degree to which it is conducive to starting and running a business. One of our biggest priorities and commitments as a government has been the creation of an enabling business environment, one in which property rights and the rule of law are respected, and in which markets take the lead, while government efficiently fulfils its role as a protector and enabler.
Since 2016, we have launched a number of efforts in this regard. The most ambitious is the Ease of Doing Business Reforms, being implemented by the Presidential Enabling Business Environment Council (PEBEC), which I have the honour of chairing. PEBEC has implemented a series of National Action Plans, targeted interventions aimed at dismantling specific bottlenecks around business and property registration, access to finance, payment of taxes, importing and exporting goods, entry into and exit from Nigeria, and so on.
On account of these reforms, the World Bank recognized Nigeria as one of the top 10 most improved economies in the world in 2017, and the International Monetary Fund (IMF) cited our business climate reforms as a major contributor to lifting the economy out of recession last year.
We are also actively collaborating with State Governments, under whose oversight some reform areas like land acquisition and property registration fall. Very recently, Lagos and Kano States – the two largest subnational economies in Nigeria – launched small claims courts to focus on SME litigations that do not exceed a certain threshold. Lagos and Kano had also come together to work out how these two of the largest economies in our country can function together, and especially with respect to certain manufacturing concerns such as leather, rice and several others.
But perhaps the most exciting of our current initiatives is our Focus Labs. The Focus lab is a process which involves our identifying investment projects that are being held back by bureaucratic bottlenecks and other challenges, and bringing the project owners and investors together with the relevant senior government officials and regulatory authorities to resolve those challenges.
The first phase of the Focus Labs identified $22.5 billion worth of investment projects. About $10 billion worth of these projects, with a potential for 500,000 jobs by 2020, have been classified as ‘Most Ready’, which means that we can get them up and running very quickly. Think of the Focus Labs as ‘Ease of Doing Business’ specifically targeted at domestic and foreign direct investors, and you would not be wrong.
Our justice sector reforms have focused also on fighting judicial corruption and building the capacity of judges. The Presidential Advisory Committee Against Corruption (PACAC) has been spearheading efforts in this regard, with notable successes recorded.
If you regard the business environment and rule of law reforms as the soft infrastructure component, then power and transportation would be the harder elements; and they are just as important. We have, in the last three years, invested close to $10 billion – an unprecedented sum – in infrastructure since 2016, focusing on roads, on power and on a new national rail network; all of which will help guarantee increased access to markets and reduced operating costs for businesses.
We are gathered here at this Summit to talk about investments meeting with opportunity as a compliment to the recent work done in the ERGP Focus Labs. The inspiring news is that we have emerged from the recession determined more than ever to make up for lost time and missed opportunities. Our focus on agriculture has attracted billions of dollars in investments in the last three years: in rice mills, sugar plantations, in fertilizer blending plants, among others.
And our Foreign Reserves have risen well beyond $40 billion now, up from $30 billion when we assumed office, and our Sovereign Wealth Fund has, in the last two years, seen its first new inflows since 2011.
We have grown our taxpayer base by 5 million new taxpayers; from 14 million in 2016 to 19 million today, as part of efforts to diversify Nigeria’s revenue base and to bring more people and businesses into the formal sector. And in 2017 we issued two new Eurobonds, our first Sukuk and Diaspora Bonds, as well as Africa’s first sovereign Green Bond – all of them very well received by the markets.
Our Sovereign Wealth Fund, as I said, has gone way up, especially with the fresh investments, a new investment of about $640 million, and this is devoted to infrastructure. We have put together an infrastructure fund, which we hope will, in the next few weeks, be launched. And we expect that this infrastructure fund will be the beginning of some of the work that we intend to do on road infrastructure in particular. This, of course, will offer fresh opportunities for those who would want to either partner with us in the PPPs that we intend to do in roads and other infrastructure, or those we simply want to contract.
In fact, when you look at the story, I think that the question that we should ask is: what does all of this mean for us as investors and potential investors who might be in the room? It means you can rest assured that there is a government in place that is committed to doing right by Nigeria, and to ensuring that everyone with a stake in Nigeria, especially those who would be investing and citizens alike – that all of us can succeed, that it is possible to do things properly, it is possible for us to create the right environment and for our investors to feel confident that government would always have their backs when they are investing here, and that things will be done properly.
For even more proof of seriousness about improving the investment climate in Nigeria, I think we need look no further than the NIPC itself, hosts of this Summit.
In the last 18 months, the Commission has left no doubt whatsoever about its commitment to fulfilling its mandate of encouraging and investments in Nigeria. It has compiled a comprehensive listing of all investment incentives in Nigeria, making it easier for existing and potential investors to have equal access to the information.
It has also launched an online, multilingual investors guide with the kind of basic information about starting a business, labour laws, taxes, land, etc that investors need to better understand Nigeria.
Now, NIPC is significantly more engaged and responsive to the needs and requirements of investors, and progressively improving the quality of information available to assist investors in making better investment decisions about Nigeria. In increasing its focus on delivering its mandate, and in its partnership with the FIRS for the Compendium of Investment Incentives and with NBS for this Summit, NIPC, in my view, is a real exemplar of the new culture of governance which we are trying to entrench across Nigeria.
I would like to urge you all to take maximum advantage of your time at this Summit, especially tomorrow when the actual engagements begin. This, in my view, is a great opportunity for us to dive behind the news headlines and the clichéd narratives, and to find out for yourselves why you should or why all of the smart money is coming here to Nigeria.
I thank you very much for listening.
