By Omoh Gabriel, Business Editor
LAGOS — The Ministry of Trade and Investment is planning to float a Diaspora Fund as part of strategies aimed at unlocking available capital for investment in critical sectors of the economy.
Minister of Trade and Investment, Olusegun Aganga, who disclosed this at a press briefing to unveil the activities of the ministry in Lagos, yesterday, said the ministry had been expanded, refocussed and re-branded so that it could play its proper role of driving the nation’s economy.
He said the ministry was structuring the Nigeria in Diaspora fund to target the well over $20 billion in the hands of Nigerians abroad to invest in the country.
He disclosed that by World Bank record, close to $18.6 billion was remitted by Nigerians in Diaspora into the country, adding that the Diaspora Fund will be inaugurated in September this year “after all the approvals are in place.”
Giving further insights into the strategies to be adopted by the ministry to fast track investment flows into the country Aganga noted that the ministry would focus on investments, sources of funds and the creation of a conducive investment climate for industrial growth, adding that there was enough capital within and outside the country to drive the required double-digit growth that would lead Nigeria becoming one of the leading 20 economies in the world by 2020.
He said, “We have so many Nigerians in the Diaspora. The economies of many countries were built based on investments from people living abroad. We are in the process of structuring a fund, which we hope to put in place sometime in September when all the approvals are in place. That fund will be targeting those Nigerians in the Diaspora.
“They will come in, bring their money and invest. According to the World Bank, in 2009, about $18.6billion was remitted to this country by Nigerians in the Diaspora. If we take half of that, and channel it the right way into the country, we will have enough capital to invest in this country. That is just focusing only on what you already have.”
He disclosed that the ministry was working with key stakeholders to create a conducive environment for investment in the country, adding that the laws and policies guiding investments must be investor-friendly.
“We have commenced a review of all the laws and policies. However, most of our laws are friendly, just that investors are not even aware of these laws and policies. We want to make sure that we do not just review them but that we also have them in a form that is easily accessible to both local and international investors,” the minister noted.
He pointed out that the ministry would also operationalise the Sovereign Wealth Fund, which was created partly because of investments. He added that the N2trillion pension fund was also “sticky, long-term money” that should be unlocked for investment in key sectors, especially infrastructure.
He said, “We will also be looking at pension funds. We are sitting on about N2trillion. Of course, you have to make sure that the assets are safe and that the money is available to pay back pensioners in the future, but in many countries, one of the reasons they have such funds is to be able to put it back in the economy. We have been very cautious about that in the past and that was the right thing to do. But perhaps the time has come for us to say, how can we unlock it in a safe way, in a responsible way, such that it will still be available in the future to pay back pensioners?
“Pension funds all over the world are the biggest investors. If you go to the United States, the United Kingdom, most parts of the world, it is the same. And it is sticky money, long-term money. In this country, we’re looking for sticky, long-term money. Since we are looking at investing in infrastructure, it means we are looking for long-term money. And pension fund is sticky and long-term. So, we must find a way of unlocking that.”
On the area of trade, Aganga said that the ministry would focus on trade imbalance between Nigeria and other countries. “We will reactivate our export and free trade zones. We have many of them but they are not working the way they should.
We will also be developing a healthy, strong small and medium enterprise sector and make sure that they have all what they require to make them succeed,” he noted.
He said a team of experts would be raised to restructure the ministry and professionalise it “with a view to making the various departments efficient and effective. The committee should determine capacity gaps in each of the departments and recommend how these gaps can be filled.”
He said that the ministry will activate the various export free zones in the country and create industrial clusters for SME to operate in a more cost effective manner. He said that the Government is working with the Lagos Business School to develop SME through the 23 enterprise centers in the country.