Nigeria is pursuing three strategic initiatives in a bid to “diversify its economy” and make it competitive in the international markets, Minister of Trade and Industry, Okey Enelamah has told investors at the ongoing US Africa Business Summit in Washington DC. Structural weaknesses blur the fact that Nigeria’s economy is diversified. The country is in dire need of foreign investment, which tanked to a nine-year low of $5.1 billion in 2016, to support a public budget less than 7 percent of Gross Domestic Product (GDP).
Enelamah said that the first of the initiatives is creating an enabling environment for businesses to thrive in the country. He explained this is why the government recently issued three executive orders that are directed at facilitating business and investment activities in the country.
The idea is not only to improve the ease of doing business but also reduce the cost of doing business. Enelamah said the executive orders have been well received in both the public and private sectors.
Nigeria ranked 169 of 190 countries in the World Bank’s ease of doing business index in 2017, as Africa’s largest economy struggles with decrepit infrastructure and regulatory constraints.
The government targets to be within 100 spots on the World Bank index by 2020, as officials ramp up efforts to smooth areas like starting a business, improved power supply and access to credit.
Another initiative, Enelamah said, is a plan to create special economic zones with the right environment for businesses to thrive. He said the Ethiopian model is being closely studied to guide Nigeria in setting up these zones.
The third initiative is the establishment of a special office for trade negotiations. This will help the government negotiate special trade relationships with its trading partners. He also said that the government has also created an industrial council to work closely with the private sector and help deal with the major issues they face in doing business in Nigeria.
“Our believe is that if we build the right environment for businesses to thrive, the private sector can help deal with the major pains in the economy especially in the areas of infrastructure” Enelamah said.
He listed the areas that foreign investors an look at coming into Nigeria include the agribusiness sector of the economy including the food value chain as well as the petrochemical industries. He also identified technology as a key area investors should be interested in due to Nigeria’s huge young population who have already created a major industry in the sector which he believes will some day rival Silicon Valley with the right investment.
He however advised investors to have a long term view of the investment opportunities in the country but assured that Nigeria means business and is determined to create the right environment for business to thrive.
Nigeria is in its second year of an economic recession after growth shrank 1.5 percent last year, the first such slump in 25 years. The IMF projects the economy will grow 0.8 percent, even as signs emerge that the country may exit recession in the second or third quarter of the year.
A plunge in crude oil prices and production tossed the country into recession, even as power, fuel and dollar shortages were part contributors.
