A new approach to doing business in Nigeria
Nigeria is ranked 170 out of 189 countries appraised on the “Ease of Doing Business”. This is heart-warming, going by the World Bank Ease of Doing Business 2016 report. The focal point of the evaluation by the global apex bank is premised on the policies government put in place to guarantee business start-ups, a seamless process in getting permits, or licences depending on the sector of investment. Power, loan, land permit, payment of multiple taxes, bureaucracy bottlenecks, among others. Important to note is Nigeria’s minimal rise to 169, quite insignificant in relation to other African countries with impressive rankings: Mauritius (32), Rwanda (62), Botswana (72), South Africa (73), to mention a few.
Nonetheless, the prompt decision by the current administration to re-evaluate the ease of doing business policies, points to the fact that existing investment policies have not been optimal in performance and need a ‘reset’ with the view of attracting the desirable investors into the country.
There is, therefore, an exigency to discern the challenges and redirect Nigeria’s investment policies, such that our present national revenue generation will improve beyond its present stage for it to forge ahead and take its rightful position in the global economic relations. Being the largest economy in Africa and one of the most vibrant in the world, Nigeria has no option than of course make its economy less dependent on oil and more independent on her immense human capital reservoir, which cuts across all sectors of the economy.
This constitutes the policy drive and focus of the Presidential Enabling Business Council (PEBEC) chaired by Vice President, Yemi Osinbajo (SAN) with the Minister of Industry, Trade and Investment, Okechukwu Enelamah serving as vice chair. Nine other ministers: Budget and Planning, Environment, Finance, Foreign Affairs, Interior, Attorney General of the Federation, Power, Works and Housing, Transport, Information, Culture and Tourism, the Head of the Civil Service of the Federation, Governor of the Central Bank of Nigeria and representatives of the National Assembly, the private sector are all members of the council established to expand the scope of investment opportunities in Nigeria and review the previous investment policies to identify weaknesses and justify the establishment of the council.
The council is coordinated by Dr. Jumoke Oduwole, the Senior Special Assistant to the President on Industry, Trade and Investment. The vision of the council is to drive improvement in Nigeria’s business environment and ensure Nigeria ranks 100 in the World Bank ‘Ease of Doing Business’ by 2019.
Consequently, President Muhammadu Buhari, while in Kenya for the Tokyo International Conference on African Development (TICAD VI) utilised the forum to showcase the commitment of his administration in the establishment of the PEBEC whose sole aim is total removal of all forms of bottlenecks that stifle the inflow of FDI and potential economic activity in Nigeria.
The partnership between the Executive and Legislative was on display during the expanded meeting of the PEBEC, it had the Senate President, Dr. Bukola Saraki and Speaker of House of Representatives Rt. Hon Yakubu Dogara in attendance. The aim is the speedy passage into law, bills seeking to reduce impediment experienced by local and foreign investors.
The bills in question are – Credit Bureau Bill to enable easy and fast access to credit for entrepreneurs, reduce default risk and improve allocation of new credit, the second bill – National Collateral Registry Bill would be a register of all collaterals used to facilitate loans by creditors, the bill when passed will eliminate customers from giving one collateral to secure multiple loans.
Former Prime Minister of Georgia, Mr. Nika Gilauri who during his tenure moved his country from 116 to 8 on World Bank’s ‘Ease of Doing Business’ attended the PEBEC meeting and said ‘Nigeria faces an urgent need to increase competitiveness to utilise its gigantic potential, to accelerate growth by creating opportunities for private sector through smart regulation and reduction of red tape.’
The PEBEC endorsed a detailed 60-day reform plan followed by 504 comprehensive actions already being implemented. Osinbajo had visited the Murtala Muhammed International Airport (MMIA), Lagos, for an unscheduled on the spot assessment of Nigeria’s major window to the world. In the course of his assessment of facilities, he noted “as part of our work on the Ease of Doing Business, on making the environment friendly, not just for local business…the airport obviously is one of the major places where we need to ensure that facilities are working and that things are being run properly”. Forty-eight hours after his visit, the Managing Director, Federal Airports Authority of Nigeria (FAAN) instructed engineers to begin repair works on all facilities at the MMIA with immediate effect.
The current administration has exhibited a determined political will, to bring succour for foreign investors and teeming army of entrepreneurs. It should be noted that, during the last PEBEC meeting, the council looked at three broad areas to improve the business climate in Nigeria, which are the entry and exit of goods, the entry and exit of persons into Nigeria and general government transparency and efficiency in agencies and parastatals of government. Another target of importance is the single digit lending to the real sector, with the aim of increasing access to small businesses that constitute a huge percentage of the Gross Domestic Product (GDP).
As highlighted, fruits of this reform are being felt already, the upgrade of the Corporate Affairs Commission (CAC) online portal to enable investors register their business without visiting CAC office has commenced, seven forms needed to fill at CAC for company incorporation has been reduced to just one. An investor can now get his Tax Identification Number (TIN) online without visiting the Federal Inland Revenue Services (FIRS).
Additionally, work is ongoing to reduce the number of agencies operating in the ports to only six. The Single Window Initiative at the ports will soon be coming on stream. Nigeria Immigration Service (NIS) Visa on Arrival and 48 hours visa processing are functional, the NIS has effected a harmonised departure and arrival form for Nigerians and non-Nigerians.
To acclimatise all this laudable policies, the Foreign Affairs Minister Geoffrey Onyeama via the Economic Diplomacy policy thrust, initiated a match-making data base platform in the 119 Foreign Missions for international businesses to have an inter-connectivity and hitch-free investments entrance. The missions will serve as a one stop-shop through which investors can find suitable information, an aperture for Nigeria to showcase her products to the world market, and enable foreign investors an all-encompassing access to bring in FDI and export promotion for the growth of the Nigerian economy.
Joining forces with PEBEC in the ease of doing business in Nigeria, the Ministry of Foreign Affairs is marshalling a blueprint for Nigerian entrepreneurs who want to export their products and furnishing foreign investors with the full information needed about investment in Nigeria. This will also help Nigerians in the Diaspora to search for partners in Nigeria and other countries using the data from the various missions.
It is evident that the economic policy of government is repositioning the Nigerian economy towards the right direction. Nigeria’s recent Euro bond of $1 billion was oversubscribed; this signals investors’ confidence in Government’s economic policy. With the PEBEC completing its set targeted 60 days action plan, we can expect a good ranking from the World Bank for the Nigerian economy to rebound unto the global map, attracting both foreign and local investors.
Sequel to the PEBEC policy, an international consortium made up of Fortune 500 companies; Power China, South Korea’s GSE&C, Dubai-based AGMC are investing a whopping $20 billion to develop the Gas Revolution Industrial Park (GRIP). This Public Private Partnership (PPP) is projected to generate 250,000 direct and indirect jobs.
The just released ambitious Economic Recovery Growth Plan (ERGP) by the Buhari-led administration, a strategy document projected to achieve seven percent GDP growth spanning 2017 to 2020, will tremendously make the country attractive to foreign investment into Nigeria in the medium to long term.
Akanji, a public affairs analyst and political strategist, writes from Abuja.