I am delighted to be present here today at the 2nd edition of the United States–Africa Business Forum. I wish to thank the United States Department of Commerce and Bloomberg Philanthropies for organizing this event and for giving me this opportunity to address this august gathering of Political and Business Leaders from the United States of America (USA), Africa and other regions of the World. I believe all of us will take advantage of this Forum to establish and strengthen business relationships; share valuable experience; and collaborate for mutual benefits.
The United States has historically been one of Nigeria’s top trading partners; for decades, the US was the biggest importer of Nigeria’s crude oil. In the last two years, however, the sharp decline in US imports of our crude, on account of rising domestic production of Shale, has altered the trade balance between our two countries. But it has also thrown up opportunities for Nigeria to increase its non-oil exports – especially in agricultural products – to the U.S.
Today, Nigeria enjoys a mutually beneficial trade and investment relations with USA. This relationship has culminated in massive inflow of Foreign Direct Investment into Nigeria. There are several US Companies doing business in Nigeria, including Exxon-Mobil, Chevron, General Electric, IBM, Microsoft, Procter and Gamble, Coca-Cola, Pepsi Company, British-American Tobacco Company, UPS Courier Company, BCG, Johnson Wax Nigeria Ltd, Pfizer Pharmaceuticals, to name a few.
These are no doubt challenging times for the Nigerian economy. But let me use this opportunity to boldly affirm our conviction that there is no crisis without an accompanying opportunity. In our case, we see Nigeria’s ongoing economic challenges – occasioned mainly by the fall in oil prices – as an opportunity to set the economy firmly on the path of true diversification, sustainable economic growth, and shared prosperity.
Since the inception of my Administration in 2015, all efforts have been aimed at ensuring that all Nigerians enjoy rising standards of living. We campaigned for and came into office on the back of three fundamental issues: One, Securing Nigeria from terrorism and banditry, Two, Fighting corruption and ensuring that public funds work for the public good, and Three, Revamping an economy that was dangerously dependent on crude oil, and afflicted by rising inequality and jobless growth. We are pleased to note that our efforts are yielding fruit.
(On Security) – Hundreds of communities and thousands of people have been liberated from the clutches of the terrorists, under our watch, and are now getting a chance to, with support from the government and the international community, rebuild their homes and their lives.
(On corruption) – Our quest is to ensure, through a combination of institution-building and judicial efforts, that public funds work for the public good, and that persons responsible for overseeing the use of these funds come to this task with the utmost sense of transparency and accountability. Earlier this year we signed up to the Open Government Partnership, a clear demonstration of our commitment to a radical departure from a past characterized by large-scale state-enabled corruption. Let me also assure that we will continue to strengthen Government institutions established to address investors’ concerns.
(On the economy) – We are weaning ourselves from a historical dependence on crude oil, diversifying our economy, and putting it on the path of sustainable and inclusive growth. To this end, we have embarked on policies aimed at establishing an open, rules-based and market-oriented economy. We will continue to actively engage with the private sector at the highest levels to listen to your concerns and to assure you of our commitment to creating enabling policies in which your businesses can thrive. Indeed, we have constituted a Presidential Enabling Business Environment Council headed by Vice President Yemi Osinbajo, which is working on a wide range of business environment reforms, ranging from making our planned visa-on-arrival regime a reality, to ports reform, to improving the speed and efficiency of land titling and business registration. We aspire to make Nigeria one of the most attractive places to do business.
Let me now focus on the priority investment sectors for our administration: Infrastructure, Industry, Agriculture, Mining and the Digital Economy.
Infrastructure: For far too long Nigeria has under-invested in the critical infrastructure necessary for a modern economy. Now, that is set to change. We are working hard to bridge an electricity deficit of several thousands of megawatts, which will require substantial private sector investment, especially in Transmission. Our railway system is being opened up after decades of a government monopoly that has hindered the needed private sector investment. We are well on course with a concessioning deal that will see General Electric take over hundreds of kilometers of existing rail assets, and invest billions of dollars to upgrade assets and services.
On Industry, there is the Nigerian Industrial Plan that is being implemented. The implementation is directed at interventions to improve productivity and output in five industry groups, namely: agri-business and agro-allied; solid minerals and metals; oil and gas; construction, and light manufacturing. Currently, investments and partnerships are being directed to leather and leather products; sugar; palm oil processing; food processing, specifically tomato and fruit processing. Automobile assembly and manufacturing are important to the diversification of the Nigerian economy. Industrial zones and parks are being established. This is work in progress.
In Agriculture, through our Agricultural Promotion Policy (APP), we are prioritizing the improvement in domestic production of rice, wheat, maize, fish, dairy milk, soya beans, poultry, fruits and vegetables, and sugar, as well as the export of cowpeas, cocoa, cashew, cassava (starch, chips and ethanol), ginger, sesame, oil palm, fruits and vegetables, beef and cotton. To achieve these goals, we are ready to partner with and support willing private investors, by creating an environment that is stable, safe, and competitive. I am pleased to note that Coca Cola has recently invested substantially in one of Nigeria’s best-known dairy and fruit juice companies, and is looking to increase its stake over the next few years.
In Mining, Nigeria is determined to build a world class minerals and mining ecosystem designed to serve a targeted domestic and export market. To accomplish this, we are prioritizing exploration, local processing and beneficiation of our mineral assets with provision of generous incentives including favorable tax regimes and royalties to investors interested in our market. We have as part of this identified mineral resources, which exist in commercially viable quantities, and designated them as strategic priorities for Nigeria’s domestic Industrialisation and Infrastructure requirements.
In the Digital Economy, which, like Infrastructure, has a multiplier effect that touches every part of the economy, opportunities abound. We have welcomed and continue to welcome investors willing to take a stake in one of the world’s largest and fastest growing telecoms markets – a market which has attracted more than $35 billion in FDI over the last decade and half. The Nigerian Communications Commission will shortly commence a licensing process for the deployment of broadband infrastructure across metropolitan areas in the country.
Young Nigerians are increasingly demonstrating that they have the talent and the passion to leverage the digital economy for solving our most pressing challenges. We are seeing a lot of activity in that space, and not just in Lagos, but even in cities further afield, from Uyo to Abuja. There are currently 150 million active mobile phone lines in the country – sixty percent of which are connected to the Internet. I can confidently say that Nigeria is in the early stages of a domestic technology revolution, and the government is paying serious attention and offering its full support.
Three weeks ago, I hosted Mark Zuckerberg, the Founder and CEO of Facebook, which is now used regularly by 17 million Nigerians, more people than in any other country in Africa. A few months ago Mr Zuckerberg invested $24 million in Andela, a technology company that has Iyin Aboyeji, a 25-year-old Nigerian as one of its co-founders, and maintains its main campus in the city of Lagos. On the same day that Mr Zuckerberg visited I also welcomed and interacted with 30 of the most exciting technology startups in the country; among whom lie tomorrow’s billion-dollar corporations.
In terms of Trade, Nigeria is keen to more effectively leverage the African Growth and Opportunity Act (AGOA) opportunities to boost exports to the US Market. In collaboration with the United Nations Economic Commission for Africa (UNECA) we have developed an AGOA Response Strategy to boost exports under AGOA. We are willing to collaborate with willing development partners to address some of the constraints to accessing the US Market under AGOA, such as our inability to comply with US requirements. With our U.S. counterparts, we are also working on a post-AGOA framework. Nigeria will continue to work closely with the U.S. to ensure that trade works for development.
I urge the American businesses present here to take advantage of the investment opportunity that Nigeria represents. Nigeria remains the number one investment destination in Africa, with total FDI inflow of about US$3.64 billion in 2015. Apart from our domestic market of 170 million, the largest in Africa, we are also the main gateway to a combined West African consumer market that is about as large as ours. With a median age of 19, and with 70 percent of the population below the age of 35, Nigeria’s greatest potential lies in the talent and energy of her youth.
Your Excellencies, Distinguished Ladies and Gentlemen, we recognize that the economic benefits of our trade and investment relations with the United States and other partners are unambiguous. In order to encourage private capital inflow, we have packaged some fiscal investment incentives which include the following: up to 5 years of tax holiday for activities classified as ‘pioneer’; Tax-free operations; no restrictions on expatriate quotas in Free Trade Zones; Capital Allowances (Agriculture, Manufacturing and Engineering); a low VAT regime of 5 percent; among others.
Let me use this occasion to announce the commencement of the latest in a series of bilateral engagements between the United States and Nigeria: the U.S. Nigeria Commercial and Investment Dialogue. This Dialogue, which will focus on Infrastructure, Agriculture, the Digital Economy, Investment and Regulatory Reform, will be jointly led by the Nigerian Minister of Industry, Trade and Investment, and the US Commerce Secretary, and will include business executives from both countries. By strengthening existing trade and investment ties between our two countries, as well as opening up new vistas, it will complement the work currently being done by the US-Nigeria Binational Commission, the US-Nigeria Trade and Investment Framework, and similar initiatives. We very much look forward to the mutual benefits that will accrue from this Dialogue.
On this note, I enjoin investors here today to take advantage of this Forum to build synergies that would translate to increased trade and investment flows between Nigeria and United States of America. Nigeria welcomes you.
I wish you a fruitful deliberation. Thank You for listening.