News / Africa

Nigeria Attractive to Investors Despite Challenges, Says Official

Peter Clottey

Nigeria’s Industry, Trade and Investment Minister says there is a strong appetite for both local and international businesses to invest in the West African nation’s economy, despite the security challenges the country faces.

Olusegun Olutoyin Aganga said recent measures, including subsidies and incentives, have created a business-friendly environment that is attracting investors. He said the move is part of the administration’s bid to create jobs for the country’s youth.                                                           

Aganga outlined some of the opportunities and the country’s potential, which he says attract global businesses to invest in Africa’s biggest economy.

“The investment appetite is huge and that is driven by many opportunities in the country [and] it’s also driven by the level of return on investment…with an average return of 35.5 percent that concurs with global average of 6%” said Aganga.

“The second major driver is the strong macro-economic environment. We are talking about a country that has consistently averaged growth [rate of] about seven percent over the last 10 years. A country when you look at the debt to GDP ratio is only about 12 percent,” said Aganga. “When you look at the exchange rate, it has been stable over a long period of time. When you look at inflation, it’s roughly about eight percent now.”

Nigeria has been able to deliver about 35 percent to the country’s capital market in 2012, and 45 percent in 2013, according to Aganga. 

He said President Goodluck Jonathan’s administration is addressing some of the challenges businesses face, which he says boosts both local and international investment in the country.

“This particular government has a number of transformational policies that are actually encouraging investors to come into different sectors of the economy,” said Aganga.

He said the West African nation has in abundance the ingredients that attract investors’ needs, including capital, technical know-how, raw materials and a market to sell their products.

“When all four come together, you definitely make huge returns for your shareholders. Capital and technical know-how, you can move anywhere in the world,” said Aganga.

Some analysts say the country’s well documented erratic electrical power challenges will undermine the administration’s efforts to attract private investors. They also said the lack of power makes the cost of producing goods and services expensive.

Aganga admits the electrical power generation difficulties but adds that the administration has taken steps, including privatizing power generation and distribution, to improve nationwide electricity power supply.

“Yes, it curtails investments, but when you look at the history [businesses] have been operating in this country for decades and the return on investment remains as high as 35 percent. So what that tells you is that there are ways around that which the bigger companies have gone around that,” said Aganga.

“Yes, the lack of power makes the cost of production higher, but that is made up for by government incentives, which [are] very generous to investors, because of the cost of labor, and raw material which is quite low and the market so that offsets that,” said Aganga.

Some critics say the privatization of the power sector is ill advised, arguing that the selling of government assets is unlikely to improve power supply. Aganga disagreed.

“Yes, we have sold our assets, realized over $3 billion, but that is not the story. The story is that it has opened the door for the private sector to drive that and today we have aggregate pipeline investment of more than a $100 billion coming to that sector,” said Aganga.

“So we will see a gradual increase in power production…Over the next three to five years you will see a significant increase because of the level of investment going to power,” said Aganga. “Again we are not just relying on gas supply we are looking at alternative sources of power. This government has made this bold decision, which is paying off and it will not be the same country in four to five years.”

You May Like

Multimedia Social Media Documenting, Not Driving, Hong Kong Protests

Unlike in Arab Spring uprisings, pro-democracy protesters in Hong Kong aren't relying on Twitter and Facebook to organize, but social media still plays a role More

Analysis: Occupy Central Not Exactly Hong Kong’s Tiananmen

VOA's former Hong Kong, Beijing correspondent compares and contrasts 1989 Tiananmen Square protest with what is now happening in Hong Kong More

Bambari Hospital a Lone Place of Help in Violence-Plagued CAR

Only establishment still functioning in CAR's second city is main hospital More

This forum has been closed.
Comment Sorting
Comments
     
by: Joe from: Outside Nigeria
August 02, 2014 11:35 AM
Well present interview with excellent response by the minister of trade and planning Mr Segun Aganga. The present administration had proved to the country and the world the country can be transform to become investment / economic hotspot of the continent. How we wish 30plus military rule achieved half of what the present administration so far achieved in less than7years of office. Therefore Nigerians should stand by the administration to actualize the full plan the administration has for the country. Lastly, GEJ lead administration not wary, fail nor faulter ,and should continues the good work for the country and making sure no political,ethnicity,selfish interest is superior to national interest.Nigeria ispoised to rewrite her history.

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
The Legacy of Jimmy Carter: The Preacher from Plainsi
X
October 01, 2014 10:45 AM
It is common in the United States to see tourists flock to sites associated with America's presidents. Some are privately owned and others are run by the National Park Service or the National Archives -- but most have helped draw business and people into the towns and cities where they are located. As VOA’s Kane Farabaugh reports, there is one particular presidential hometown that is unique in what it has to offer those who make the trip.
Video

Video The Legacy of Jimmy Carter: The Preacher from Plains

It is common in the United States to see tourists flock to sites associated with America's presidents. Some are privately owned and others are run by the National Park Service or the National Archives -- but most have helped draw business and people into the towns and cities where they are located. As VOA’s Kane Farabaugh reports, there is one particular presidential hometown that is unique in what it has to offer those who make the trip.
Video

Video Hong Kong Protests Draw New Supporters on National Holiday

On the 65th anniversary of the founding of Communist China, Hong Kong protesters are hoping to stage the largest pro-democracy demonstration since the 1989 Tiananmen protests. VOA's Brian Padden visited one of the protest sites mid-day, when the atmosphere was calm and where the supporters were enthusiastic about joining what they are calling the umbrella revolution.
Video

Video India's PM Continues First US Visit

India's prime minister is on his first visit to Washington, to strengthen political and economic ties between the world's oldest and the world biggest democracies. He came to the U.S. capital from New York, the first stop on his five-day visit to the country that denied him an entry visa in the past. From Washington, Zlatica Hoke reports Modi seemed most focused on attracting foreign investment and trade to increase job opportunities for his people.
Video

Video Malaysia Struggles to Stop People Joining Jihad

Malaysian authorities say militant groups like the so-called "Islamic State" have used social media to entice at least three dozen Malaysian Muslims to fight in what they call "jihad" in Syria and Iraq. As Mahi Ramkrishnan reports from Kuala Lumpur, counterterrorism police are deeply worried about what could happen when these militants return home.
Video

Video Could US Have Done More to Stop Rise of Islamic State?

President Obama says airstrikes against Islamic State militants in Syria will likely continue for some time because, in his words, "there is a cancer that has grown for too long." So what if President Obama had acted sooner in Syria to arm more-moderate opponents of both the Islamic State and the Syrian government? VOA State Department Correspondent Scott Stearns reports from the United Nations.
Video

Video Treasure Hunters Seek 'Hidden Treasure' in Central Kenya

Could a cave in a small village in central Kenya be the site of buried treasure? A rumor of riches, left behind by colonialists, has some residents dreaming of wealth, while others see it as a dangerous hoax. VOA's Gabe Joselow has the story.
Video

Video Ebola Patients Find No Treatment at Sierra Leone Holding Center

At a holding facility in Makeni, central Sierra Leone, dozens of sick people sit on the floor in an empty university building. They wait in filthy conditions. It's a 16-hour drive by ambulance to Kailahun Ebola treatment center. Adam Bailes was there and reports on what he says are some of the worst situations he has seen since the beginning of this Ebola outbreak. And he says it appears case numbers may already be far worse than authorities acknowledge.
Video

Video Identifying Bodies Found in Texas Border Region

Thousands of immigrants have died after crossing the border from Mexico into remote areas of the southwestern United States in recent years. Local officials in south Texas alone have found hundreds of unidentified bodies and buried them in mass graves in local cemeteries. Now an anthropologist and her students at Baylor University have been exhuming bodies and looking for clues to identify them. VOA’s Greg Flakus has more from Waco, Texas.
Colonel Steve ‘Spiros’ Pisanos left Greece and came to the U.S. to learn to fly. He flew fighters for the Allies in World War II, narrowly escaping death multiple times.Colonel Steve ‘Spiros’ Pisanos left Greece and came to the U.S. to learn to fly. He flew fighters for the Allies in World War II, narrowly escaping death multiple times.

AppleAndroid