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Thursday, 25 September 2014 13:10

Nigeria to Regain Leadership in FDI Flow to Africa

iTigerBy Crusoe Osagie

LAGOS, Nigeria, Sept 25, 2014 (This Day) -- The European Union stated that its current strategy and work plan for Nigeria would help in repositioning the giant West African nation as the leading destination for Foreign Direct Investment (FDI) in Africa

The EU Ambassador to Nigeria and the Economic Community of West African States (ECOWAS), Mr. Michael Arrion, who made the statement in Lagos at the EU-Nigeria Business Forum, said it was illogical for Nigeria being the largest economy in Africa, to slide from the top position in terms of FDI flow in the continent.

He, however, noted that the integration of the West African subregion into one solid economic bloc, which is the principal objective of the Economic Partnership Agreement (EPA), had an essential role to play in helping Nigeria attract foreign investment.

The United Nations Conference on Trade and Development (UNCTAD) had recently stated that Nigeria had dropped from the top position in attracting FDIs in the African continent, a position which the EU says it is committed to help Nigeria fix.

Arrion said Nigeria lost the top spot as a result of the difficult operating business environment in the country, making the nation uncompetitive in the global market. He stressed that other factors attributed to the decline, was the insurgency in the North-east and other security threats in the country.

"We cannot deny the gravity of the current challenges but it is also important that we portray Nigeria's positive side, most of which lies in its thriving economic, social and cultural life,"he said.

The ambassador pointed out that for Nigeria to regain the leadership position, it has to attract more investments into the country; implement broad based policies with a long term perspective.

"Through our development cooperation, the EU is working closely with the Nigerian authorities to improve its business environment and competitiveness; boosting its industrial revolution agenda through support of the reform of the electricity sector and accessing long term financing and tackling social issues like malnutrition," he said.

He stated that the EU was the most accomplished example of regional integration at work which has led to competitiveness within the union; removal of obstacles to free movement of goods, services and people.

Arrion noted that Nigeria is the largest economy in Africa and the industrial hub of West Africa, urging Nigeria to take advantage of the West African market as an extension of its domestic economy.

"Nigeria stands to be the greatest beneficiary of an integrated West African market. This is what the EPA seeks to achieve; consolidation of regional markets; promotion of regional trade; removal of barriers to trade while protecting sectors that are considered sensitive to the economies of the ECOWAS member states," he added.

The ambassador commended the ECOWAS Heads of States for signing the treaty on the Lagos-Abidjan corridor, saying about 70 per cent of the commercial traffic in the region takes places within the corridor.

"The signing of this treaty marks a significant milestone towards fostering true regional integration in West Africa," he stressed.

He said EU FDIs stock in Nigeria grew from N5.3 trillion in 2011 to N5.7 trillion in 2012, stating that the EU is Nigeria's most important trading partner.

According to him, "In 2013 alone, total EU-Nigeria trade stood at N8.5 trillion. EU imports from Nigeria were valued at N6 trillion while EU exports to Nigeria stood at N2.5 trillion."

"Though Nigeria maintains a positive trade balance with the EU the EU remains the biggest market for both oil and non-oil exports. It is imperative to address the EU-Nigeria relationship towards a more diversified composition and a strengthened ECOWAS regional market," he said.

Also speaking at the forum, the Minister of Industry Trade and Investment, Olusegun Aganga, decried the country's growth ratings by international organisations such as the World Bank and Global Competitiveness Index, noting that despite all effort aimed at developing a vibrant private sector for improving the business environment, doing business and competitiveness ratings still remained low.

Aganga said as a result of this poor rating of the country in the last few years, the federal government had put in place some reform measures to address the perceived non-competitiveness of the Nigerian business environment and the subsequent low rating of the country.

The minister who was represented by the Minister of State, Industry, Trade and Investment, Dr. Samuel Ortom, explained that as captured in the transformation agenda of the President, Federal Republic of Nigeria, the main thrust of the business environment reforms is to ensure that the private sector plays a central role in advancing innovation; mobilising resources; creating wealth and creating jobs; and in turn contributing to poverty reduction.

"To a very large extent, we consider all our reform initiatives to have recorded many successes, because, each of them was part of an organic whole designed to develop the economy in a consistent and sustainable manner. It has not been an easy journey but the reforms are gradually taking shape; key economic indices indicate that we are making consistent progress. The government in addressing Investors' concern has inaugurated two business committees, namely Doing Business and Competitiveness Committee, and Investor After-Care Committee," he said.

He added that the Doing Business and Competitiveness Committee, charged with the responsibility to regularly monitor, review and recommend improvement on existing policies and legislation that govern the act of doing business in the country, has made some recommendations and reform actions on ways to reduce the time, cost, and number of procedures in doing business in Nigeria, which are being implemented.

"The After-Care Committee, constituted to handle complaints from investors on account of apparent irregularity and inconsistency in the implementation of government policies, has effectively resolved some administrative challenges being faced by industries and businesses, thereby restoring investors' confidence, enhancing national competitiveness, and injecting assurance to prospective investors," he said. (Source: This Day)

 

 
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