Business
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The change in federal government’s industrial policies has attracted more pipeline investments worth about $59 billion into the country
| By Anayo Ezugwu | Nov. 24, 2014 @ 01:00 GMT |
NIGERIA is now a destination of choice for foreign investment. About $59 billion pipeline investments have come into the different sectors of the economy within the last three years because of the federal government’s far reaching industrial policies. Olusegun Aganga, minister of industry, trade and investment, said the industrial policies initiated by his ministry in line with the transformation agenda of President Goodluck Jonathan, helped diversify the nation’s economic base and made the country a destination of choice for investment.
According to the report of the United Nations Conference on Trade and Development, Nigeria was ranked the number one destination for investment for two consecutive years, with the country maintaining its top three positions last year. “If you look at pipeline investments that have come into the country within the last three years, we have a minimum of $59 billion coming into the different sectors of the economy over the next five to eight years. This does not include the investments that are coming into the power sector. If you look at the value chain, we have about $60 billion investments going into the power sector, the minister said.
Out of the $59 billion, about $12 billion is going into integrated petrochemical plant. This means that if that petrochemical plant comes on stream as planned by 2018, there will be no need for the country to import refined petroleum products, and that will be a big boost towards the economic diversification of the country. Also, a lot of investments are going into fertiliser and ethanol plants, agribusiness such as sugarcane to sugar, rice mills and cement, among others. There are also new investments going into the automobile sector due to the implementation of the Nigerian Automotive Industry Development Plan, which is a major component of the Nigeria Industrial Revolution Plan.
According to him, the increased investment focus on Nigeria, as well as sound policies across all sectors of the Nigerian economy, had helped to create more employment and increase the capacity utilisation of key manufacturing sectors of the Nigerian economy. He said, unlike in the past, when there was no comprehensive and coordinated industrial policy for the country, the Nigeria Industrial Revolution Plan had been developed as a major game changer.
President Goodluck Jonathan in February 2013, launched the Nigeria Industrial Revolution Plan as a major game-changer. This was based on the principle that no nation has successfully moved from being a poor to a rich nation without a robust industrial and services sector. In 2011, we did not have a comprehensive automotive policy on the ground. Today, in the automotive sector, more than 22 companies have signed technical commitments to manufacturing or assembling cars in Nigeria.”
The manufacturing capacity utilisation for the automotive sector had also increased by 40 percent, while investment in sugar cane had risen from $100 million in 2011 to N3.2 billion today, Aganga said. In the cement sector, the minister said MITI, under President Jonathan, had made significant progress, with installed capacity currently at 39.5million metric tonnes, up from 16.5million metric tonnes per annum in 2011. In 2011, the installed capacity in the cement sector was 16.5 million metric tonnes per annum. Today, it is 39.5 million metric tonnes. “When we came in, there were about $9 billion investment in the cement sector, but today, it is more than $15billion. In 2011, the direct and indirect jobs from the cement sector were less than 600. Today, the sector provides about 2.2 million direct and indirect jobs,” he said.
Aganga said unlike in the past when there was heavy importation of cement, since 2013, the administration of President Jonathan has not issued any import licence. “Our main focus for the cement sector, going forward, is to improve the standard of cement and to bring the price down. Cement manufacturers must do it because we do not do price regulation. There was an announcement a few days ago that one of the cement manufacturers is bringing down the price of its 32.5 by 40 percent from N1,700 per bag to N1,000. The 42.5 is coming down from around N1,800 to about N1, 150 per bag.
“There have been complaints about what is happening in the sector. But Nigerians should not worry because we know what we are doing. We have a competition policy, we have anti-trust law that we are looking at and we have a competition Bill that is going to the National Assembly. We will make sure that industrialists and investors across the country continue to have the confidence that everyone will play on a level playing ground,” the minister said.
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