By Tony Obiechina, Abuja
Minister of Finance, Budget and National Planning Mrs Zainab Ahmed says Nigeria’s economy has evolved stronger over the past years especially during the tenure of President Muhammadu Buhari.
Speaking on the sidelines of the United Nations General Assembly, the Minister pointed out that although there has been challenges, the country’s economy has been waxing stronger.
She said “This is always a bitter sweet experience. It is bitter because in the short term, government will have to sacrifice its income in the form of tax concessions, import duty exemptions and many other fiscal incentives we use to attract and sustain investments.
“But it is also sweet because in the medium to long term, we will create jobs, reduce our reliance on imports and ultimately, have a strong tax base for future government revenues.
Responding to a question about who is investing in Nigeria, Mrs. Ahmed said: “In the past seven years as a cabinet minister, I have seen a growth in the number of Nigerian companies investing in Nigeria. Let me, for example, start with the downstream oil and gas sector. For decades, Nigeria has been looking for investors globally to support the expansion and modernisation of its refining sector. Unfortunately, with little success to show for it.
“However, in the past seven years, we have seen significant investments by Dangote, Bua and Waltersmith Refining and Petroleum Company Limited.
All are Nigerian companies. These investments, when completed, will reverse Nigeria’s reliance on importation of refined products in the coming years.
“Another example is in the agriculture value chain. In 2014, most of our food and agricultural inputs were imported. We had less than 10 operational rice mills and fertiliser blending plants.
Today, we have close to 70 rice mills and some 50 fertiliser blending plants that produce NPK fertilisers.
“As a matter of fact, many are already doubling their capacity in such a short period of time.
For example, WACOT Rice in Kebbi is increasing its capacity from 120,000 metric tonnes to 240,000 metric tonnes. Same can be said for Umza Rice Mills in Kano.
“When we talk about urea and ammonia, Nigeria has now become a global player. Dangote recently commissioned its urea plant, and Indorama is expanding its capacity as well.
The Nigeria Sovereign Investment Authority (NSIA) in partnership with OCP of Morocco, is also developing an Ammonia facility. And we have a few more in the pipeline.
“Then on telecommunications, we ran a licensing round for our 5G network. The winning bid is a wholly owned Nigerian company”, Ahmed added.
On infrastructure development, the Minister said
“Nigeria has seen private companies make significant road investments under our Road Infrastructure Development and Refurbishment Investment Tax Credit Scheme. We have also seen Africa Development bank (AfDB) backing our Special Agro-Industrial Processing Zone programs.
“In financial services, our fintech revolution is second to none in Africa. We have the highest number of Unicorns on the continent.
” The seed capital and the brain power that enabled these businesses to flourish partly came from Nigerians.
“Then on Mergers and Acquisitions (M&A) deals, the two biggest transactions this year have been by Nigerian companies. The first, which happened in April 2022 was the acquisition of Honeywell Flour Mills by another miller, Flour Mills of Nigeria. The second, which was completed in June 2022, was the acquisition of Union Bank of Nigeria by TGI Group through its subsidiary, Titan Trust Bank.
“You will recall Union Bank was majority owned by Atlas Mara and a consortium of global and domestic private equity funds.
“Now what is very interesting about both deals is although both buying companies are Nigerian, the majority shareholders here are non-Nigerians.
“Sticking to this theme, we have also seen Nigerian subsidiaries of international companies such as Olam, Indorama and OCP of Morocco expanding their footprint in Nigeria.
“To fund these transactions, the investors have received significant support from international banks. But what is most interesting is the increased funding support from development finance institutions such as AfriEximBank, AfDB and more.
“In a nutshell, investment has continued in Nigeria. It is just the type of investment has changed. And we are tracking this new trend very closely to see how we can support the DFIs. They have done a tremendous job!”
L-R: Mrs. Zainab Shamsuna Ahmed, Minister of Finance, Budget & National Planning, Mr. Laoye Jaiyeola CEO, NESG, Mr. Adeniyi Adebayo, Minister of Industry , Trade & Investment at the Nigeria International Economic Partnership in New York during UNGA 77.