Govt moves to bridge $2.4tr infrastructure funding gap
•NIPC initiates investment promotion masterplan
THE Federal Government has unfolded plans to commence the implementation of a strategic investment master plan, to bridge the country’s infrastructural funding gap, currently estimated at about $2.4 trillion, within the next 30 years.
Under the strategic plan, the Nigerian Investment Promotion Commission (NIPC), has been mandated to collaborate with relevant agencies and stakeholders, to enthrone a new regime of investment-friendly policies, potent enough to attract new investors to the economy sustain the interests of the existing ones.
Essentially, the initiative was scripted to ensure effective implementation of the nation’s investment promotion masterplan, to bridge the infrastructure funding gap, on a sustainable basis.
As part of the new strategies in transforming the NIPC to deliver on its mandate in line with global best practices, the agency is currently streamlining investment procedures, in order to remove all bottlenecks in business legalisation procedures, among other ongoing critical reforms.
The Executive Secretary/Chief Executive Officer, NIPC, Mrs. Saratu Umar, disclosed these during a media roundtable organised by the agency as part of its ongoing stakeholders’ sensitisation programme, in Lagos, on Tuesday.
She stressed that infrastructure funding has emerged as a priority under the proposed the investment promotion master plan being developed by the commission, to drive investments into critical sectors of the Nigerian economy, adding that the agency had already commenced stakeholders’ collaboration aimed at bridging the funding gap.
According to her, “Foreign Direct Investment (FDI) is widely acknowledged worldwide as the most useful and cheapest source of development finance because it creates employment, engenders transfer of technology, conserves foreign reserves, ensures availability of quality goods and services, among others.
“For this reason, the competition for FDI has been very stiff, particularly in recent years, due to globalisation brought about by technology.
“One of the strategies adopted by most countries to attract FDI is the establishment of Investment Promotion Agencies (IPAs), with over 170 IPAs world wide competing to attract often limited FDI to their various countries. Nigeria needs over $2.8 trillion infrastructure funding over the next 30 years, whereas the estimated budgetary provision will be about $45billion. This leaves a huge shortfall of about $2.4trillion.”
She added: “In terms of FDI, Nigeria receives an average of $7.5 billion yearly. If this is constant over the next 30 years, we would have only brought in $223 billion in FDI. If we compare this to the infrastructure investment requirement, we still have a huge gap.
“Therefore, a massive FDI inflow is required to service the implementation of the various strategic master plans across critical sectors of the Nigerian economy. The implementation of the NIPC’s Investment Promotion Master Plan is being designed to address the sector-specific funding gaps.
“The Nigerian Investment Promotion Commission is therefore repositioning to bridge Nigeria’s infrastructure funding gap, estimated at about $2.4 trillion over the next 30 years. If the commission is to achieve its purpose, there is the need for effective collaboration with stakeholders for mutually beneficial purposes.
“In this regard, we are reviewing our strategy with respect to Partnerships, Image, Investment Targeting, Client Servicing etc, in a coordinated fashion that facilitates steady and sustainable growth of FDI in Nigeria.
“We have also set up an Investment Coordination Framework to improve the business climate, improve the ease of doing business and ensure policy consistency. This will help to enhance investors’ confidence in the Nigerian economy.”
The Executive Secretary noted that the agency had also streamlined its investment promotion drive through the promotion of country specific and sector-specific investment opportunities, and in line with Nigeria’s investment priorities.
“This is in addition to developing a structured and result-driven investment promotion calendar and certification of private organisations engaging in investment promotion activities,” she stated.
Speaking during the event, the Chairman, Heirs Holdings, Tony Elumelu, said Nigerians should support the ongoing efforts of the NIPC towards promoting the country’s hugely untapped investment opportunities to both local and global investors.
He said: “I am here at this meeting as a representative of the investors’ community in Nigeria. Our country needs both local and foreign investments to achieve inclusive and sustainable economic growth and development. The new CEO of NIPC, Mrs. Saratu Umar, is currently doing a good job by repositioning the agency to become a globally competitive investment promotion agency. We need to give her our total support and encouragement.”
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