How essential is FDI to Nigeria’s diversification efforts and economy?

I would say Nigeria needs investment, both foreign and local [because] the development gap and the infrastructure gap are huge and the government can’t fund them alone. What can spur rapid industrialisation? It’s infrastructure. The current president has been focused on the infrastructure gap Nigeria has suffered from for many years and bridging that gap.

Advertisement

The best model for Nigeria is an investment-led model. Therefore our strong preference is to partner with private capital, development capital to build up the infrastructure. So it is in that space that you have to situate the foreign investment. FDI has to be win-win and we are trying to create an enabling environment for that capital.

Do you think China is a key partner for infrastructure development?

I think China’s role is important because it is prepared to finance long-term infrastructure at competitive rates – take, for instance, railways, power or roads – so it’s an important partner. It has this balance sheet with an African focus. The key, though, is to make it a win-win partnership.

Can you elaborate on a ‘win-win’ situation?

We want the railway for our own industrialisation. We want to create jobs locally. We want to help our agenda. Why is China doing it? China is looking for markets for its products and surplus capital. The world works best when those that with capital surplus work with those that are capital-hungry – providing you do it on a win-win partnership again.

When you think about which part of the world needs the investment for its own purpose and also for the world, Nigeria in particular and Africa in general will have to be part of that because we have a young population that needs infrastructure to help create the jobs that will absorb them.

What are the other big FDI opportunities, outside the oil sector?

I would say industries such as agro-processing, light manufacturing and petrochemicals. We have good services, too, and a digital economy. I will also say social services in terms of health, education and the social infrastructure you need to build a modern economy. Innovation is actually a critical component to investment.

What are Nigeria’s key FDI challenges and how are you overcoming them?

The number one thing that we are trying to solve is ease of business and the environment. The other thing is creating the right incentives. Incentives aren’t just fiscal incentives – which are very important – but also policy incentives to receive the investment.

There is nothing wrong with trade but investment and trade should be some kind of continuum. Our economic zones are very competitive, with all the infrastructure and partnerships with the private sector [so] investment and export is easy.

Separately, we are developing a number of policies around tomatoes, palm oil, cassava and around things that are mostly agro-processing, and also around petrochemicals, where we have a comparative advantage.

Finally, we are creating the right environment for partnering with private capital, especially in infrastructure. Creating air routes for instance, working with the local pension funds and the international financiers (like the development capital financiers) to build the infrastructure, to build the air routes that will make it easier to do business in our country.