‘Why Nigeria is now one of the best investment destinations’
Minister of Industry, Trade and Investment, Dr. Okechukwu Enelama, in this interview with The Guardian’s Abuja team, spoke on the achievements of the President Muhammadu Buhari administration from the perspective of the ministry. He provides a robust outlook on Nigeria’s enabling business environment with clinical arguments of the country’s growing international rating as an industrial hub accentuated by excellent government policies. He spoke to Abuja Bureau Chief, Igho Akeregha and reporters Anthony Otaru and Comfort Dafe.
On achievements of the Ministry of Industry, Trade and Investments
If you look at our Ministry – the Federal Ministry of Industry, Trade and Investment, you will agree with me that we have a role to play, particularly, in achieving the economic agenda of the President in terms of diversification of the economy, growing the economy and creating jobs. Therefore, looking at our objectives, which you can use to measure what we said we want to do.
Now, what we said we want to do is what we are doing. You see that for instance, we have a five point agenda from day one.
The first one is that of creating the enabling environment for business to thrive, for the private sector, for SMEs and for Nigerian citizens and stakeholders to do well. In fact, we christened our ministry as the ministry of enabling environment, Industry, Trade and Investment. And when we gave our first press interview or relationship, this point was also made clear.
The second one was on industrialization. As Ministry of Industry, Trade and Investment, Industry is not just our name but it is our responsibility to make it work to a large extent. Unfortunately, the country had already gotten a Nigerian industrial Revolution Act. So, our objective was to take it from planning to implementation. Again, I will tell you what we’ve done on that.
The third objective we had was on the whole area of investment – to promote and attract investment. Because again, you can’t industrialize without investment and you can’t achieve most of our aspiration of economic diversification and job growth, creating jobs and economic growth without investments.
You also know that the investment portfolio includes Investment Promotion Agency, the Nigerian Investment Promotion Commission, so, we said we will proactively attract both domestic and Foreign Direct Investment which means, that we will be proactive in finding out how and where people need to increase their investment, to make new investment or to support the investments.
The fourth pillar was on trade. You know, basically to create the environment for trade particularly for facilitating trade and the right kind of strategic trade agreements and relationship in a way that it will increase exports and make trading easier to facilitate.
And the final area was on SMEs – Small, Medium Scale Enterprises. This class is the largest employer because they make up over half of the GDP and there are millions of SMEs and most of them can be considered as Micro, Small and Medium Scale Enterprises. They have some needs that cut across things like access to funding, capacity building, training, access to market, infrastructure and that this is how you have them. Ours is the focal ministry working with them. If you ask the agencies responsible for assisting them, everyone will mention this ministry as a standout to help them. We must create sustainability, so that in all these things and whatever we are doing, we should have institution building and of sustaining our efforts.
Enabling business environment
Now, with that as the background, I want to give you a quick update on each one. We have a report, like our mid-term report we can share with you, in it, we have first, one of creating enabling environment for business. We consider this very key without any doubt, it is our most and important priority in the ministry. As a government, if you understand what an enabling environment meant, I always tell people for those of you that are students of the Bible. God went to Solomon and said; ask me for only one thing. And he said, give me wisdom and most scholars call it a strategic prayer – they call it the prayer that answers all other prayers. The equivalent in government is an enabling environment. If God comes to you and say, what can I do for you as a country? We must ask for enabling environment because it covers everything. Infrastructure is there, micro-economic stability is there, the rule of law is there, security, everything is there. An environment that enables is the environment that works. And as we know Nigerians, if you give them the right environment they thrive.
It is not a surprise that when Nigerians go abroad where the environment is better, they excel. So, I think as a government, we can go further and say, as stakeholders in Nigeria, we have a commitment and collective responsibility to create enabling environment for our people. If we go back, this will ease a lot of tension and will create a lot of goodwill for the government and also, for the stakeholders because a lot of people go about their normal business and whatever government does for them is almost like an extra. And if you look at what we’ve done, the President setup in the first half of 2016, a Presidential Enabling Business Environment Council to focus on enabling environment issues because he said it is so important hence he set up a Presidential Council. He directed the Vice President to chair it and for many of us who were members, were also directed to report to the Federal Executive Council (FEC) periodically. We are actually reporting quarterly and that council has been up and running now about 18 months down the line and it’s been very successful. It includes the Vice President as the Chairman, I’m the Vice Chairman, it also has 10 Ministers on it, the CBN Governor, Head of Service and heads of all the leading Agencies that interacts with the public e.g. Corporate Affairs Commission, FIRS, NAFDAC and of course Customs,
Immigration and others.
And that council has been meeting and so far so good. Now it is the council that now set up the secretariat i.e. an implementing body or secretariat because the council is like a board.
The Secretariat is called “Enabling Business Council Secretariat” and is coordinated by a lady called Dr. Jumoke Oduwale, a Senior Special Assistant to the President, working in the VP’s office but now she’s acting virtually fulltime by coordinating the entire Business Environment Secretariat.
Now, we have undertaken a series of reforms. That is where the improvement in ranking on business came from. As you may know, we’ve moved up 24th basis points after 10 years deterioration and that’s why Nigerians received the news with all excitement. This is a very objective evidence, because the government is working the talk. Imagine an Independent World Bank rating all the countries on their merits and then also adjudging or recording Nigeria as one of the top 10 countries in the World in ease of doing business in the last one year. It said we have to sustain it and observed that for the fact that we have started, it shows the formula is working and you know, where a formula is working, you apply it more. So you are going to see a spirited and a committed sort of efforts to make the ease of doing business work more for the people. Like I always tell people, it is not just about the ranking.
We must not forget that we are interested in making business easier for Nigerians and so that work will continue. We can basically say we are now doing well starting from how you register your company, get your permits, land, how the businessman borrow money, how the company do the various things a company does throughout its life cycle, that’s what the World Bank measures and that is where Nigeria has improved to 24th place in ranking of the ease of doing business. We will continue.
We are also working with other key government agencies and ministries. Things like the Ports, Airports and trying to make it easier for people to travel, as I speak with you, people often tell me that they like the changes that is taking place at the Airports, Seaports e.g. getting visa on arrivals or getting the visa within 48 hours as well as getting their passports before they leave where they are coming from. You can also talk of improvements at the Airports which is an ongoing thing but we can also improve on it, remember at the ports, we are now working on a single window idea. I can pause on that but that is just the first pillar.
When you come to the Second pillar, which is industrialisation because that is the heart of the diversification agenda of the government. When you choose agriculture, or what we call the Agro-Industrial value chain, that is where diversification is focused to actually take place. And the country, like I said already, has a plan called – Nigeria Industrial Revolution Plan but it was a document that has not been implemented before the coming on board of this government and we took up the implementation and we’ve done a number of things and the first is to make sure, we put in place an implementing body that will be made up of government and the private sector or industrialists. That is why the President again launched/commissioned the Industrial Council or Industrial Policy and Competitiveness Advisory Council or Industrial Council in short. Now, that industrial council has members from leading private sector businesses and people who interact with industry and again the leading ministers chaired by the Vice President. This time around, it has two Vice Chairs, one from the public sector, myself and Aliko Dangote from the private sector. It also has a Deputy Vice Chair who incidentally is the Minister of State, Industry, Trade and Investment, Hajia Aisha Abubakar and Atedo Peterside, the retired Founder, CEO and Chairman of Stanbic IBTC Bank. And of course, it has many members across industries. It comprises large and small and at different sectors including ICT and traditional manufacturing and so on. And that council has been meeting monthly and it has done a lot of good work. Only last time, it was announced that it has come to the point that the council has made some recommendations, which we are going to take to the FEC for approval. So, what to focus on 5 critical areas for industrialisation e.g. critical infrastructure, power, roads and so on. Two is financing – for industrialisation. Three is vocational training and skills acquisition for industrialisation. Four, is trade and market access for people to trade their goods and finally, policy and regulations. And in each of these areas, we have a sub-committee working on them, public and private sector and at the ministerial level, CEOs and they are well supported and they have come up with recommendations that can be accomplished say, within one year within the life of this administration.
They are working in medium, short and long terms. We hope to start more with the immediate so that people can see results and the industrial council is also doing very well as a focal ministry, we setup the council under the direction of the President chaired by the Vice President and we are working with our fellow ministers and MDAs to implement all the recommendations because industrialization is a collective effort of not just the entire government but of course, the entire society, private sector, financials, and all the other service providers otherwise we cannot do it alone. So that is the second pillar.
We just hosted recently, the D8 meeting, which is basically eight developing countries that focuses on industrialization. Few weeks ago, we hosted a high level forum on investment and trade facilitation, all these efforts are towards diversification of the economy, industrialization of the economy in general and you will see that the efforts are ongoing.
Permit me to talk about trade because trade and industrialization are related. The third pillar I want to talk about is our efforts in facilitating trade and creating the right structure or agreements on trade. You will find there, that the most important accomplishment is setting up of the Nigeria Office on Trade Negotiations and getting a very competent and experienced trade expert to run it. This gentleman has been in the World Trade Organization for close to 20 years and before then, he was in the foreign service of Nigeria and decided to leave that to head this office. Before now, he has spent about nine years advising the government on how to set up the right trade mechanisms to make sure we keep to all agreements and that we create synergy and coordination across ministries and trade.
You could see that trade is also cross-cutting, it’s not only a matter of the Ministry of Trade. It affects finance, exports, the budget in terms of people coming around so at the end of the day, we now have a trade platform, and within this trade platform, we are negotiating the continental trade set of agreements which is basically an agreement or a platform that will encourage intra-African trade and the important thing about that is that, you find that the intra-African trade today is about 50 percent or less. If you consider places like Europe it’s about 60 per cent, Norway, America the same thing and you need just that to increase the selling of our processed goods. The reason we sell only raw materials is that we are sending it to the West where there are mostly advanced equipment and technologies. But if we trade amongst ourselves, the advantage is that we will capture more value within our own continent and that is what we are doing. And Nigeria is chairing it. I am chairing the African countries ministries of trade CFTA and our chief trade negotiator in the Nigeria office for trade negotiations is chairing the technical committee and that work – the AU Summit which is the highest body have asked for that work to be completed by the end of 2017. That work is progressively going on.
We are also trying to get a better handle of the ECOWAS trade. We believe these intentions are good but a lot of complaints both from us and from them; we talk about sub-standard goods coming in, about leakages and dumping where people manufacture goods in China and would come and dump them in Nigeria without paying tariffs. So, all these works are going on through what we call, “Safeguard Mechanism” e.g. dumping substandard goods and things that are generally inimical or not good for us in terms of our trade. In terms of our achievement, Nigeria is also a signatory to the World Trade Organisation (WTO) trade facilitation agreement, which was signed early this year. That agreement is expected to foster trade by removing some bottlenecks and barriers to trade.
The fourth area is investments promotion. It is a major priority of this government. We have set a target of trying to reach about $10bn during the first phase of the economic recovery and growth plan. That is the plan, as you know, it’s our medium term plan 2017 – 2020. However, this year alone, the investments have been announced but they’ve not been all coming in the way of cash but they have been committed to and its well over $20bn and we can tell you who is making those commitments. And this is from the Nigeria Investment Promotion Council (NIPC), so you can verify it from them. The new Head is the former Head, Investment banking in Stanbic IBTC, Mrs. Yewande Sadiku. She now heads the NIPC. It is also working with the states in terms of promoting investments at those levels because different States have different endowments. NIPC is also trying to attract Foreign Direct Investments more by encouraging other investors to come, we also revamped the pioneer states investment scheme which was done about few months ago and approved by FEC. So there are many achievements under the investment platforms. I think the only one I have not covered is in SMEs.
Small and Medium Enterprises
On SMEs, what we are doing is what I call a multi-facet approach. This is an approach that has many elements. First, is on financing through the Bank of Industry. [BOI]. We are trying to make sure we provide funding at various levels. The BOI for instance, is running the “Social Intervention Fund” programme for artisans, market women, call them any name. And that programme is focused on basically providing funding from N20000, N30000 and N40000 to N100000 for people who just need a little bit of working capital to trade. Now, we want to democratize this to make sure this programme gets to the hinterland not just that it ends in the big cities. And BOI has committed to spend at least 10 per cent of its capital on SMEs and its trying to raise capital from N600bn N700 billion to about N1 trillion. That means that about N1bn would be available for SMEs. Currently in the ministry, we have an SMEs Directorate Department working well. We are also working with the states, I was in Ebonyi state with the President and Ebonyi Governor announced that the partnership programme with BOI is targeting over N2bn of matching funds for SMEs in the state and they hope to get interest rate at single digit, say l0 percent or less. So, there is something being done by a number of other states, in Abia state which is my home state, we also have a programme supported by the World Bank, we call it growth and it exclusively falls under the SMEs to help women in capacity building and training in terms of financing and also in terms of market access for various industries and clusters.
And that programme has a target of reaching about 4,000 SMEs and training for over 10,000 people. So, many things are going on. You know we have the small and medium Enterprises Agency (SMEDAN) that is focused exclusively on SMEs. There is something called NEDEC. This is a joint effort between SMEDAN, BOI and ITF. These agencies, which support the SMEs, use this to work in synergy to provide the SMEs the capacity training they need as well as funding. They are being implemented.
Impact of government policies and intervention on the economy and Nigerians
Jobs creation is without any shadow of doubt, our singular objective. On job creation, you have to ask how do you create the job. What I have explaining is how to do it. A lot of these efforts I’ve talked about is job creation but they need to be sustainable. I got the information the other day that over 7 million jobs have been created by this administration but I have not done the calculation myself. But by targeting the most vulnerable who are often not caught by statistics, you will find that jobs creation under this administration is increasing. The second thing I want to say is that if you link this to infrastructure, we are determined to improve infrastructural development, which is what the budget is looking at. This government for the first time is spending at least 30percent of its budget on infrastructure.
Indeed, most of the borrowings are done to rebuild our railways, airports, roads, power and infrastructure in general if we do those things, you know I spent a long time in business myself, I think you will be creating the enabling environment for the jobs to just flourish. You will realize that the deficit in infrastructure, the dilapidated infrastructures has generally been a deterrent to job creation. This is why the President said when he was a military ruler, he built most of these infrastructures maybe early 80s and since then, the argument is that there has been a lot of talk. If you notice most of the infrastructures we have were done then. This is the first concerted effort to rebuild these infrastructures in a holistic and in a quantum way.
So, unfortunately, it takes time to build infrastructure and one thing you find is that to build an infrastructure, you’ll not only use it to create jobs but will also help for investments.. So the more you provide power, the more you make it easier and give them the right incentive to invest.
I told you already that we’ve announced the case of N20bn this year. What we believe is that the trend has changed and you know we just got away from the recession since September or so. You also know that, the mood has also changed, if you are here one year ago and you are here today, maybe you are someone who is sensitive, you will agree with me that where Nigeria is today is not where she was when we took over the government.
Separating facts from fallacies
A lot have been said but we need to look at statistics. Everything I have said above, you are free to go and check them out. People may not know and that is why The Guardian is important and other media. And people should not be deceived by politics. There are some people who have vested interest in saying nothing is going on, contrary to compelling evidences. If not that the World Bank gave some salient statistical points to Nigeria as earlier mentioned, people will say that it is a fraud. Now they are not saying that they are just asking or saying would it be sustained? All the things I have said to you and I know you are recording them, please go and check, go and verify them from relevant agencies/organizations. I like using the scriptures as an example.
You know there were group of Christians who every time they have a message they go and check the bible, they go and read the bible if it’s true. These set were called the “Berrien Christians” so you should be like a Berrien Christian. Take all what I have said to you and go and checkout if they are true. And when you found out any contradiction, you can come back to confront me with your findings.
So that you are not rejecting the message because you want to support people who have vested interest in telling the people lies. You hold a specific responsibility and you must not fall short of that, so tell them what is going on. Politicians have a different responsibility, to want to win elections, so, if they have their way, they will tell you please keep quiet till after the elections.
2018 budget and trade and investment industry
First, let’s see what the budget is all about in overall. The budget is what we call, a consolidation budget. What are we consolidating? All these things I have told you have started and they now need to be bettered down i.e. When it is anchored down, it’s when you plant, you put down the root very well. This is what consolidation means i.e. making something strong so that it cannot be blown away by the wind. So, the 2018 budget is that of consolidation. We want it to be sustained.
The budget has close to N60billion for special economic zones, they are special parks and industrial cities where industries would strive and everything would be there – power, road infrastructure, the connectivity they need, the value chain, this is how other countries have developed. In Nigeria in the past, we only talked about it. We did not do it.
So, there is a budget for this and we are going to do it, ours is for geo-political zones. This will be real. The other thing we can tie the 2018 budget to is that, it is a budget of consolidation and which facilitates the ease of doing business. To make businesses easier particularly for automation, and that of implementing the order 001 which is on and that would happen.
It is also a budget for export expansion grant (EEG). There is funding for it to make sure that people export their products. You will also find out that it is a budget that supports all the key pillars of the ministry I talked about earlier. I think for us, we are a facilitating ministry, meaning that we help other people succeed, both the private sector, public sector et al. And I think the budget will also be a consolidation for us in the ministry meaning that we will enforce the things we are doing already rather than trying to do new things.
In the Economic Recovery and Growth Plan (ERGP), waivers and business competitiveness, we no longer grant waivers to individual companies. That should be corrected. There is no company today that we grant waivers. But what you have is sectorial access to waiver such sectors like sugar, plants, tomato; we did one for tomato this year, as you may know. But in general, we grant incentives to everybody, pioneer incentives scheme, incentives for capital allowances for importing equipment and so on. A lot of the things you are asking are legacy questions for mistakes of the past. That is why we continue to blame past government each time and people say why are you saying that? Even journalists questions always relate to this.
The journalists are still dealing with these questions, which we are correcting. In the past, individual waivers were granted at random but not anymore, we don’t do it, I stand to be corrected, go and verify.
Two, the economic recovery and growth plan is about partnership with the private sector, so we give them incentives but not individual waivers, we give incentives to investors to put their investment in Nigeria in infrastructure for instance, particular sectors we need to have comparative advantage, where we have issues to sought out like tomato, sugar, cement agro-processing, cotton, petrol chemical etc. the important thing is that, we must walk the talk. What happened in the past and that is the difference between this government and the previous governments. People actually enjoy rhetoric, you know the way you come and make the announcement, thank God we have a president that is not given to much words. When he says something, he doesn’t take it back. So we intend to implement the ERGP with those policies I mentioned earlier.
Impact of negative International perception of Nigeria on corruption and terrorism
Three quick comments on this, the first one is that it is good to get your priorities right, we must give more credit to President Buhari. In short, I was in a place and somebody says he has 10-point agenda but this President is saying he has only three-point agenda. So, you can see what is necessary is to be focused.
I haven’t seen anybody coming up with a better strategy than security, fighting corruption and working on the economy. If you do these three things, you’re home and dry.
How come people are coming up with 7, 10 points agenda? The government agenda is correct and focused. Two is that when somebody tells you that Nigeria is the third most terrorized country in the world, you begin to marvel; I mean it is ridiculous, even in Africa alone where you have Somalia, you have Djibouti, I mean you have all these other countries, what exactly does that mean? I travel a lot, Nigeria is not where we want to be but Nigerians know that where we are today is not where were before and certainly not one of the most terrorized countries in the world, particularly in the context of the previous President versus the current President. Boko Haram was terrorizing the North East, took over so many territories basically the important thing is that the former President was helpless.
Now, a President comes in and said you have this problem and he said, I will solve it for you, I am not saying you should go and thank him but at least, lets appreciate him for doing something which a man before could not do. Yes, there are still sporadic attacks but they are not where they were before. Like I said before, trends are more important than levels. The final thing I would say on that is our vision according to the World Bank who described Nigeria as the 10th most reforming country. Today, it shows that Nigeria is one of the safest, most attractive places of ease of doing business in the world. People were saying Nigeria Ke? Do you know we are a people of faith? And we are now backing our faith with works? We are working hard and you can see the job we are doing. I think you had better believe that Nigeria is changing. This is what I think but am not saying it’s going to be easy but I want a synergy with the private sector and the media so that things will flow better. Am aware that government should do its own part but Nigeria as a whole has a collective responsibility to make our country attractive from the media stand point, from the governance stand and from an investment stand point, let’s work together and by so doing you’ll find that we would create a better country for all of us.