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

Obama: Alaskans Feel Signs of Climate Change

They're seeing bigger storm surges as sea ice melts, more wildfires, erosion of glaciers, shorelines More

Katrina Brought Enduring Changes to New Orleans

The city’s recovery is the result of the people and culture the city is famous for, as well as newcomers and start-up industries More

Magical Photo Slides Show Native Americans in Late 1800s

Walter McClintock spent 20 years photographing the Blackfoot Indians and their vanishing culture at the dawn of the modern age 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.
Colombians Flee Venezuela as Border Crisis Escalatesi
X
August 27, 2015 2:08 AM
Hundreds of Colombians have fled Venezuela since last week, amid an escalating border crisis between the two countries. Last week, Venezuelan President Nicolas Maduro ordered the closure of a key border crossing after smugglers injured three Venezuelan soldiers and a civilian. The president also ordered the deportation of Colombians who are in Venezuela illegally. Zlatica Hoke reports.
Video

Video Colombians Flee Venezuela as Border Crisis Escalates

Hundreds of Colombians have fled Venezuela since last week, amid an escalating border crisis between the two countries. Last week, Venezuelan President Nicolas Maduro ordered the closure of a key border crossing after smugglers injured three Venezuelan soldiers and a civilian. The president also ordered the deportation of Colombians who are in Venezuela illegally. Zlatica Hoke reports.
Video

Video Is China's Economic Data Accurate?

Some investors say China's wild stock market gyrations have been made worse by worries about the reliability of that nation's economic data. And some critics say the reports can mislead investors by painting an unrealistically-strong picture of the economy. A key China scholar says Beijing is not fudging ((manipulating)) the numbers, but that the economy is evolving quickly from smoke-stack industries to services, and the ways of tracking new economic activity are falling behind the change. V
Video

Video Next to Iran, Climate at Forefront of Obama Agenda

President Barack Obama this week announced new initiatives aimed at making it easier for Americans to access renewable energy sources such as solar and wind. Obama is not slowing down when it comes to pushing through climate change measures, an issue he says is the greatest threat to the country’s national security. VOA correspondent Aru Pande has more from the White House.
Video

Video Shipping Containers Provide Experimental Housing

Housing prices around the San Francisco Bay area are out of reach for many people, so some young entrepreneurs, artists and tech industry workers are creating their own houses using converted shipping containers. But as VOA's Mike O’Sullivan reports from Oakland, the effort requires ingenuity and dealing with restrictive local laws.
Video

Video Arctic Draws International Competition for Oil

A new geopolitical “Great Game” is underway in earth’s northernmost region, the Arctic, where Russia has claimed a large area for resource development and President Barack Obama recently approved Shell Oil Company’s test-drilling project in an area under U.S. control. Greg Flakus reports.
Video

Video Philippine Maritime Police: Chinese Fishermen a Threat to Country’s Security

China and the Philippines both claim maritime rights in the South China Sea.  That includes the right to fish in those waters. Jason Strother reports on how the Philippines is catching Chinese nationals it says are illegal poachers. He has the story from Palawan province.
Video

Video Technique May Eliminate Drill-and-Fill Dental Care

Many people dread visiting dentists because they're afraid of drills. Now, however, a technology developed by a British firm promises to eliminate the need for mechanical cleaning of dental cavities by speeding a natural process of tooth repair. VOA’s George Putic reports.
Video

Video China's Spratly Island Building Said to Light Up the Night 'Like A City'

Southeast Asian countries claim China has illegally seized territory in the Spratly islands. It is especially a concern for a Philippine mayor who says Beijing is occupying parts of his municipality. Jason Strother reports from the capital of Palawan province, Puerto Princesa.
Video

Video Ages-old Ice Reveals Secrets of Climate Change

Ice caps don't just exist at the world's poles. There are also tropical ice caps, and the largest sits atop the Peruvian Andes - but it is melting, quickly, and may be gone within the next 20 years. George Putic reports scientists are now rushing to take samples to get at the valuable information about climate change locked in the ice.
Video

Video French Experiment in Integrating Roma Under Threat

Plans to destroy France’s oldest slum have sparked an outcry on the part of its Roma residents. As Lisa Bryant reports from the Paris suburb of La Courneuve, rights groups argue the community is a fledgling experiment on integrating Roma who are often outcasts in many parts of Europe.
Video

Video Kenyans Turn to Agriculture for Business

Each year Kenyan universities continue to churn out graduates for the job market despite the already existing high rate of unemployment among youth in the country. Some of these young men and women have realized that agriculture can be as rewarding as any other business or job, and they are resorting to agribusiness in large numbers as a way of tackling unemployment. Rael Ombuor reports for VOA.
Video

Video First Women Graduate Elite Army Ranger School

Two women are making history for the U.S. Army by proving they are among the toughest of the tough. VOA's Carla Babb reports from Fort Benning, Georgia as 94 men and those two women rise as graduates of the difficult Ranger school.

VOA Blogs