Interview: H.E. Maj. Gen. Chris S. Eze, Nigerian High Commissioner to India
Titbits from The Desk of H.E. Maj. Gen. Chris S. Eze on Nigeria’s Economic and Investment Potential
Nigeria as a Preferred Investment
Destination in Africa
- The largest economy in Africa.
- Abundant natural resources such as crude oil, coal, bitumen, solid minerals, arable land, adequate sunlight and rainfall, among others. Further details of nature’s bounty can be found on the Nigeria Investment Promotion Commission website, www.invest-nigeria.com.
- A growing and huge population (more than 180 million) which guarantees a large market to all industries.
- Nigerian economy is closely linked with the economies of other countries in ECOWAS. The country’s economy is also booming with massive ongoing infrastructure projects.
- Democracy and its institutions are becoming stable which adds to the creation of an investment-conducive environment.
Competitiveness of ECOWAS in the Global Economy
ECOWAS as a regional economic forum is filled
with huge yet untapped potential. However, with huge hydro-carbon deposits
being discovered in its member countries and with governance improving, the
forum is poised to become the dominant trading block in Africa; with Nigeria
leading the economic integration. Efforts
are also ongoing for ECOWAS to adopt a single currency to complement the
already existing free market and free movement of goods and people.
Diversification of the Nigerian Economy
Diversification is taken very seriously by
both the government and by the private sector. Emphasis is on agriculture,
solid minerals, infrastructure, solar energy, ICT and value addition to primary
products.
Anti-Corruption
President Buhari has been unanimously chosen
by African Heads of State as the face of anti-corruption within the continent.
This shows how serious he is in curbing the menace. The President has been
blocking leakages; recovering looted funds; investigating corrupt governments
officials and politicians, and charging them to court; enlisting the support of
foreign government to identify monies stashed by looters in banks abroad, and
assets purchased by them through corruption.
As a result of
all this, the opposition is ganging up against President Buhari in the run-up
to the coming national election (which will take place in February, 2019).
Particularly frightening to the corrupt is the speculation that Buhari does not
intend to renew the licenses for oil blocks which were issued to selected
individuals by past governments (when those licenses expire in 2019); but he
would rather distribute the said licenses to state governments – to boost their
revenue bases and capacity to develop their infrastructures.
President Buhari’s implementation of the
Treasury Single Account (TSA) has already blocked many avenues through which
Chief Executives of government agencies siphoned government money – by operating multiple bank accounts which
were often difficult to audit properly. He also introduced a whistle blower’s
compensation policy that has encouraged ordinary Nigerians to enthusiastically
join the anti-corruption fight.
Major Thrust of Bilateral Trade Between
India and Nigeria
- Volume in 2017: $9.4 bn
- Balance of trade: 80% to 20% in favour of Nigeria
- Major Nigerian export – crude oil. India is the biggest importer of Nigerian crude oil while Nigeria is India’s largest trading partner in Africa.
- Indian exports to Nigeria include pharmaceuticals, engineering equipment, automobiles, and power sector components such as transformers, insulators and circuit breakers.
India Vs China in Nigeria
A competition between the Asian giants does
not exist because the Nigerian economy is large enough to accommodate all
players – as long as they are competitive and deliver quality products and
services. India is fairly good at this, particularly at the lower end of
technology which is more suitable for Africa, given our present stage of
technological development.
However, the wider perception is that there
is a greater synergy between Chinese government and Nigerian businessmen as
compared to others who operate in Africa and their respective governments. Also
the perception is that the bureaucratic process here could do with a speeding
up if India is to significantly improve its economic footprint in Africa as a
whole and Nigeria in particular. In particular the disbursement of the $10bn
Line of Credit that India offered Africa two years ago could be accelerated.
India’s Role in Africa’s Development
Africa is no longer interested in foreign
aid, which has served no meaningful purpose over the decades. What the countries here want now are trade,
value addition to its primary products, infrastructure, proper utilization of
its abundant minerals, quality education and health-care, respect to each
nation’s sovereignty and the dignity for the people. India can help in all these by encouraging
its own entrepreneurs to invest in Africa and by continuing to collaborate with
the continent at multilateral forums,
including the WTO and the UN
Areas of Possible Investment by India in
Nigeria
- Agriculture
- Mining
- Infrastructure development on Public Private Partnership (PPP) basis or on the Build, Operate and Transfer (BOT) model
- Oil – already existing but potential for more cooperation
- ICT – a well performing relation
- Solar energy – this is a growing market in Nigeria. Nigeria also has enormous amounts of sunshine to make solar energy a big and lucrative venture. Hence, building plants for the manufacture of photo voltaic cells is highly feasible commercially. A positive step in this direction is that Nigeria is also a member of the International Solar Alliance (ISA).
Views on the Footprints of Indian Companies in Nigeria
Indian companies investing in Nigeria is a
mutually beneficial aspect. As long as
the companies are ready to ‘play by the rules’ set by the Nigerian government,
they are always welcome in the country. However, these companies must become
more serious about Corporate Social Responsibility (CSR), which has become an
integral part of doing business worldwide.
Areas of Cooperation between Nigeria and India as Emerging Continental Giants
India and Nigeria have the potential to
cooperate across virtually all areas. India knows that Nigeria is not only the
largest economy in Africa, but also the most influential black nation on earth.
It should therefore make Nigeria the anchor of her Africa policy while Indian
businessmen should solidify Lagos as their African hub. Since global trade is regulated by the WTO –
which seems to be under threat today – the two countries should continue to
work hand in hand on international issues such as world trade and the reform of
the United Nations Security Council.
It is also important that New Delhi opens up
opportunities for Nigerians to do legitimate business in India by granting them
import licenses and permission to rent and operate retail shops, even if they
are only for Nigerian products.
Finally, the Bilateral Air Services Agreement
(BASA) which the two governments have been negotiating for years should be
speedily concluded; especially since Nigeria is ready to launch Nigeria Air.
This will further improve connectivity between India and Nigeria. I have stated
elsewhere, and I repeat here, that Africa as a whole, and Nigeria in
particular, are now looking East. India is a huge political, military and
economic power in that part of the world so she is a crucial factor in the
pivot.
VISION 2025
• Nothing like Vision 2025
has been officially adopted or announced by the Federal Government of Nigeria.
• The extant one is Vision
2020 which was conceptualized during the military regime of General Sani Abacha
in the mid-90s and has been upheld till date. Its core objective is as
follows:-
“By 2020 Nigeria will be one of the 20
largest economies in the world, able to consolidate its leadership role in
Africa and establish itself as a significant player in the global economic and
political arena”.
The potentials of Nigeria’s economy have
never been questioned by the outside world but corruption, policy flip-flops,
lack of sustained planning and visioning, security and infrastructure
challenges have all played their part to slow down the realization of those
potentials.
The greatest obstacle however, has been
Nigeria’s failure to diversify its economy and its continued reliance on crude
oil – which is not only a decreasing asset but a commodity which is subject to
both wild price fluctuations and also in danger of being replaced by
alternative sources of energy in the near future. The most precipitous decline
in oil price occurred just as the present government of President Muhammad
Buhari came into power in 2015, from a high of over $100 during his
predecessor’s time, to as low as $28 per barrel
at a certain period.
Vision 2020 is however back on course with
President Buhari’s dogged pursuit of his three core programmes which are:
ensuring security, fighting corruption and growing the economy. As a result
Nigeria has officially come out of the recession it went into in 2016 with a
forecast growth rate of 1.5 percent for 2018, and to rise thereafter. Nigeria
moved up in the global Ease of Doing Business rankings; rail lines are being
built to carry passengers and bulk cargo (whose weight have been damaging the
roads); foreign direct investment has started to flow in again; Nigeria Air has
been re-launched to come into operation and provide direct air links between
Nigeria and countries with which we have singed Bilateral Air Services
Agreements; banking and financial services are being strengthened; our foreign
reserve now stands at over $47bn from less than $30bn at the time President
Buhari came into office, and this is in spite of earning lower revenue from
oil; agriculture is growing and imports of rice, a staple, have been cut by 90
percent. Above all, when Dangote refinery – which has a capacity to refine
640,000 barrels of oil per day – will come into operation at the end of 2019,
it will stop the importation of refined products which not only gulps a considerable
portion of our foreign exchange, but in the past, also provided avenues for
corruption (through mismanagement of subsidies that the federal government gave
to keep transportation costs within Nigeria moderate and thus control
inflation). Mining, ICT, oil,
agriculture and infrastructure development are nodal sectors in which the
diversification of Nigeria’s economy are being aggressively pursued. Solar
energy has huge but as yet untapped potentials.
Public/Private Partnerships are encouraged,
as are completely private ventures. Export free zones also abound with generous
incentives and Indian companies are among the leaders in taking advantage of
those opportunities. Our National Investment Promotion Commission is doing a
great job in coordinating all these initiatives. It can be read on www.invest-nigeria.com.
Kanchi Batra is the Business Editor of The Diplomatist.
