By Omoh Gabriel, Business Editor
The Federal Government’s policies on industry, trade and investment activities are yielding modest results, according to industry stakeholders
GIVEN the slowdown in economic growth globally as a result of the 2008 financial melt down from which various governments across the world are beginning to retool and realign their economic policies, towards specific areas that will make meaningful and positive impact on the lives of their citizens.

Nigeria in response came up with plans to transform its huge population and natural resource endowments into economic advantage. Nigerians across various spectrum of the economy have stressed that the government needs to embark on game-changing policy reforms in key sectors of the economy for a sustainable development. Echoing the need for such a game changing policy, National President, Nigerian Association of Small Scale Industrialists (NASSI), Chief Chuku Wachuku, said “there is no gainsaying the fact that Nigeria is a country blessed with enormous human and material resources.

Material resources

Aerial view of the Computer Village, Ikeja

What is needed is for the government to consistently develop and  implement investment friendly policies and reforms that will create a conducive environment for businesses to thrive. This will unlock the hugely untapped investment opportunities across the country, create jobs and generate wealth for our people”.

Perhaps, it was in realisation of this fact that President Goodluck Jonathan, through the Ministry of Industry, Trade and Investment, embarked  on Investment Climate Reform programmes to make the Nigerian business environment more  conducive for trade facilitation and also fast-track the growth of local and foreign direct investments across all sectors of the Nigerian economy. Prior to 2011, experts said, no government had put in place comprehensive and  strategic sector specific policies  to address the prevalent challenges militating against the country’s business environment. But the scenario has changed considerably now, according to them.

Ease of doing business: An official document  obtained from the Ministry of Industry, Trade and Investment, indicates that the President approved the establishment of a Doing business and Competitiveness Committee to address the challenges faced by businesses across the country to improve their productive and competitive advantage. An Investor After-Care Committee was also put in place to ensure that after investors make their investment decisions, Government works with them to ensure that all operating bottlenecks are taken care of.

The report said, “The Federal Government has repositioned and strengthened  the  One Stop Investment Centre at the Nigeria Investment Promotion Commission to ensure that investors have all their needs met in a single location. Similarly, the government has established a National Competitiveness Council as a partnership between the private sector and public sector as part of a deliberate strategy to address issues relating to the competitiveness of the Nigerian business environment.

This is in addition to developing a National Policy Framework for Investments, working in partnership with OECD and DFID. The Ministry is creating Regional Investment and Trade Offices (RITOs) in every major continent to serve as a tool for opening access to Nigerian goods and services in global markets as well as investment promotion for key investment opportunities in Nigeria. The first RITO was launched in China; another one will be launched in Abu Dhabi in 2015.”

In addition to these, the Ministry of Industry, Trade and Investment, under the Transformation Agenda of the current administration, has reviewed the country’s obsolete investment laws, which have hitherto inhibited the inflow of local and  foreign direct investments. Highlighting work done in this regard, the Minister of Industry, Trade and Investment, Mr. Olusegun Aganga, said, “Prior to this administration, what Nigeria had were investment laws and policies, most of which were not  investment friendly and also outdated. They did not reflect the  current global economic  realities. In fact, some of the investment laws we had had not been reviewed since 1963.

Emergence of new laws

“However, since 2011, many changes have taken place. This is in addition to facilitating the process of the emergence of new laws, including the establishment of the first ever Competition Bill in the country, which is currently at the National Assembly. Also, we have embarked on a comprehensive review of the Insolvency Bill. The first ever Franchising Bill is also being reviewed for onward transmission to the National Assembly. This is in addition to carrying out a comprehensive review of the Company and Allied Matters Act (CAMA), with major amendments proposed.”

Experts and stakeholders have given their independent assessments of how the reforms have impacted on Nigeria’s overall business climate. According to the 2014 Ease of Doing Business Report released by the World Bank, Nigeria has recorded significant improvements in its Doing Business Index in the last four years. The report noted that from 2010 till date,  the country had recorded  34 improvements in its Ease of Doing Business Index. “For the first time, Doing Business in Nigeria 2014 recorded reforms that make it easier to start a business,” the report said.

Speaking on how the Doing Business and Investment Climate Reforms Programme has transformed the country’s business climate, the World Bank Country Director, Nigeria, Ms. Marie Francoise Marie-Nelly, said, “Nigeria’s business climate has improved significantly since 2010 when the last benchmarking exercise was conducted.

Benchmarking exercise

This is a positive achievement we all should be proud of. This shows that change is possible in Nigeria, especially now that the country has positioned itself as the largest economy in Africa and the leading destination for foreign direct investment globally.” Registrar-General, Corporate Affairs Commission, Mr. Bello Mamud, in his assessment of the economy said, “The Ease of Doing Business Reforms embarked upon by Nigeria in the last four years has  resulted in a 50 per cent reduction in capital registration costs for the Micro, Small and Medium Enterprises (MSMEs);  and 25 per cent reduction in capital registration costs for large businesses; and for the first time in Nigeria, we can do 24 hour registration of companies at our two Lagos offices, Kano, Kaduna, Enugu and Abuja.

“For CAC, we have never had it so good. The reform programmes have made it possible for us to establish an online registration portal, which was launched just yesterday. Our start to finish services in Lagos, Kaduna and Kano has helped in eliminating mandatory requirement for lawyers in the business registration process. Also, these reforms have  had significant positive impact on businesses.”

According to Mahmud, ongoing reforms “have ensured a 60 per cent reduction in the cost of business registration; 18.5 per cent increase in the number of companies registered; 52 per cent increase in the number of MSMEs registered and  27 per cent increase in the number of industries registered.”

Growth in FDI and investors’ rising interest in Nigeria: Despite the global challenges, renowned institutions and experts have continued to express unwavering confidence in Nigeria as the preferred destination for foreign direct investment in Africa and globally.  The United Nations Conference on Trade and Development (UNCTAD) ranked Nigeria the number 1 destination for investment in Africa for two consecutive years and top three last year.

The latest report from Ernst and Young Africa’s Attractiveness Survey, said, “The most striking observation from this year’s survey is how Africa’s perceived attractiveness has improved. In less than five years, Africa has risen to become the second most attractive investment destination in the world. Nigeria, South Africa and Kenya are ranked the most attractive investment destinations in Sub-Sahara Africa.”

Recent statistics

In the same vein, the Wall Street Journal’s Frontier Market Sentiment index (FMSI), which tracks investment interest from the top 200 USA and EU multinational companies, has for the first time ever, ranked Nigeria as the number one country of interest globally. According to recent statistics from the Central Bank of Nigeria,  the country’s combined FDI and Foreign portfolio investments (FPI) have grown from $7.9 billion in 2011 to $21.3 billion in 2013.  Indeed, stakeholders, including local and international experts and investors, have attributed Nigerian’s emergence as the preferred destination for FDI within Africa and globally, to the implementation of  investment-friendly reforms by the Federal Government within the last four years.

Speaking during a meeting with the Minister of Industry, Trade and Investment, the Canadian High Commissioner to Nigeria, Mr. Chris Cooter, said Canada was working on strategies aimed at increasing its Foreign Direct Investment in Nigeria within the next few years due to enhanced confidence in the Nigerian economy.

“Today, there is a wind of change going on in Nigeria’s investment landscape, which is being driven by the Minister of Industry, Trade and Investment. Therefore, we are looking at areas where Canadian companies can invest in Nigeria and how they can form partnerships in Nigeria in line with the Nigeria-Canada Bi-National Commission,” he said.

Mr. Simon Smits, Vice Minister, Foreign Trade of the Kingdom of the Netherlands who spoke during his official visit to Nigeria, said “I am convinced that trade and investment are the drivers of change, development and wealth.

What I have observed during the past few days of my visit to Nigeria is that when I spoke with both business people from Nigerian and Netherlands, they said the opportunities in Nigeria out-weigh the challenges. There is a right track that the Nigerian government both at the Federal, state and Local Government levels have found in order to improve the welfare of the Nigerian people. We, as the Dutch, stand ready to assist Nigeria in this regard. A number of our businesses have been in the various sectors of the Nigerian economy for many decades. Obviously, they would not have still been here if Nigeria is not profitable for them. And the fact that we are still around in Nigeria shows that some of our businesses have found the right place to do business.”

The Minister of Industry, Trade and Investment, Mr. Olusegun Aganga, said, “Prior to the commencement of this administration, Nigeria did not have a trade policy at any level. There was low level intra-African trade with little prospect of it expanding. Domestic trade was inefficient and costly. There was no functioning commodities exchange while Nigeria played a subdued role at regional and international trade organisations and forums.

“However, all these have changed for the better. For the first time in our history as a country, we have developed a holistic and strategic Trade Policy, focusing on International trade, regional (Intra-African) Trade and Domestic Trade. Already, we have developed a new international trade policy linking Nigeria’s trade policy to its Industrial policy in order to ensure strategic expansion of trade across different product value chains, including trade in services. Also, we have launched the Nigerian Diaspora Export Programme to leverage on the huge population of Nigerians abroad to promote our abundant non-oil exports.

Trade experts  believe that reforms embarked upon by the government seem to have yielded impressive results, stressing that over the last decade, the country’s total trade has jumped from a low level of N3trillion in 2000 to N21trillion in 2013, while non-oil exports have steadily increased since 2011, rising by 7.4 per cent between 2011 and 2013. Between 2012 and 2013, the country recorded a 16 per cent increase in its non-oil export.

The President, National Association of Nigerian Traders (NANTS) Mr. Ken Ukaoha, attributed  the growth of the nation’s trade sector to the Federal Government’s favourable policies,  which has helped to strategically reposition trade as one of the major drivers of Nigeria’s economic growth.

Ukaoha said, “Trade has contemporarily become the heartbeat of Nigeria’s economy, and has contributed largely to Nigeria becoming the largest economy in Africa. The National Association of Nigerian Traders – NANTS is happy with this development; and  happier with the fact that the growth of Nigeria’s trade and Investment sector is attributable to the opening of space for regular interactions/consultations with stakeholders, including the private sector, and particularly with NANTS as the national umbrella for traders.

“This medium of consultations created by the current Honourable Minister of Industry, Trade and Investment – Dr Olusegun Aganga, and credit must therefore be given to this visionary and dynamic leadership. This has further opened channels for policy dialogues that create buy-in and maximum support for the government’s programmes and plans.

It has reduced resistance and improved implementation of noble trade policies that attract investments.

He added, “One of the major hallmarks of this administration is that popular participation and the approach of inclusivity has become the order of the day. This has undoubtedly raised the confidence of traders and manufacturers on the commitment of the federal government to providing adequate protection to the real sector practitioners while also providing incentives to spur the Nigerian private sector to increase their investments in their own country.”tors.”