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YEWANDE SADIKU
EXECUTIVE SECRETARY/CEO
NIGERIAN INVESTMENT PROMOTION COMMISSION
ABUJA | 05 NOVEMBER 2018
NIGERIA: A STRATEGIC INVESTMENT
DESTINATION
THE PREFERRED LOCATION FOR CANADIAN INVESTMENTS IN AFRICA
1
181
411
36 45
2015 2020 2025 2030 2035 2040 2045 2050
Nigeria Canada
0.006%
Nigeria – Canada
NIGERIA CANADA
Capital Abuja Ottawa
Official Language English English & French
Land Area 910,770 km² 9,093,510 km²
People (2017)
Population (m) 191 36.7
Pop. growth rate (%) 2.6 1.2
Median age 18.4 40.6
Economically active pop. (15-64) 98 24.6
Economy (2017)
GDP nominal ($’ bn) 375.8 1,653
Agriculture (% GDP) 24.5 1.7
Industries (% GDP) 22 28.1
Services (% GDP) 53.6 70.2
GDP growth rate (%) 0.8 3.1
Inflation (%) 15.7 1.6
Labour (2017)
Labour force (% of pop.) 59m (31) 20.1(55)
Trade (2017)
Import $’bn, (% of GDP) 30.7 (8.2) 548.3(33)
Export $’bn, (% of GDP ) 44.5 (11.8) 510.7(31)
Trade balance (% of GDP) 13.8(3.6) -37.6(<0)
Investment Climate (2017)
EoDB 145 18
GCI 125 14
Comparative statistics
Population (m)
GDP ($’bn)
515 568481 404 376
1,843 1,799
1,560 1,5361,653
2013 2014 2015 2016 2017
Nigeria Canada
Sources: United Nations World Population Prospects; World Development Indicators, World Bank Doing Business (EoDB) Report 2017; Global Competitiveness Index (GCI) 2017-2018; www.countryeconomy.com
Age 15-64
61%
60%
2
Nigeria in global context
3
How the world will look in 2050
China
India
USA
Indonesia
Brazil
Britain
Italy
France
Bangladesh
Russia
Japan
Germany
China
India
USA
Indonesia
Brazil
Pakistan
Nigeria
Bangladesh
Russia
Mexico
Japan
Ethiopia
China
India
Nigeria
USA
Indonesia
Pakistan
Brazil
Bangladesh
Congo DR
Ethiopia
Mexico
Egypt
Most populous countries
1950 20172050
Forecast
7
3
190.9m
410.6m
Source: United Nations World Population Prospects: the 2017 Revision, medium variants
4
How the world will look in 2050
Source: PWC Analysis, from “The long view: how will the global economic order change by 2050?”
2.3
%1.9
%
4.2%
-1%
0%
1%
2%
3%
4%
5%
Vie
tna
m
India
Ba
ng
lade
sh
Pa
kis
tan
Ph
ilipp
ines
Nig
eri
a
Eg
yp
t
Indo
nesia
So
uth
Afr
ica
Ma
laysia
Colo
mbia
Me
xic
o
Sa
ud
i A
rab
ia
Chin
a
Ira
n
Tu
rke
y
Arg
en
tina
Th
aila
nd
Bra
zil
Au
str
alia
Po
lan
d
Russia
Unite
d K
ing
do
m
Can
ad
a
So
uth
Ko
rea
Unite
d S
tate
s
Neth
erl
an
ds
Fra
nce
Sp
ain
Ge
rma
ny
Italy
Jap
an
Projected average real GDP growth p.a., 2016-2050
Average pop growth p.a % Average real growth per capita p.a % Average GDP prowth p.a. (in domestic currency)
Nigeria could be the fastest growing African economy to 2050,
and could move up the GDP rankings, to 14th by 2050, if it can
diversify its economy away from oil and strengthen its institutions
and infrastructure.
14
5
The African growth story is real
1988 - 2000 2013 - 20302001 - 2012
GDP growth (CAGR)
Above 5%
Between o% and 5%
Less than 0% (negative)
Number of economies growing faster than 5% a year
11 11
7
1
6
32
1 1 3
64
8
21
24
Asia-Pacific CIS Central and Southeast
Europe (CSE)
Middle East SSA
1988 - 2000
2001 - 2012
2013 - 2030
Source: EY’s 2015 Africa Attractiveness Survey
6
But a wide perception gap exists: present optimists, absent doubters
Source: EY’s 2015 Africa Attractiveness Survey (total respondents:501)
#1Africa is the most
attractive investment
destination in the world
66%believe attractiveness
has improved over the
past year
81%believe attractiveness
will improve over the
next three years
Respondents who are not
established in Africa
Africa is the second
least attractive
investment destination
in the world
Believe attractiveness
improved over the past
year
Believe attractiveness
will improve over the
next three years
Respondents who are already
established in Africa 50%
30%
7
Nigeria in context
Sources: National Bureau of Statistics (2018 estimates), http://www.data.worldbank.org
Top
5To
p 5
Smallest
Smal
lest
Population (m)
Total: 192,449,083
Botswana 2.3
Rwanda 12 .2
Israel 8.7
Sierra Leone 7.5
Belgium 11.4
Land size (km2)
Total: 910,710
Panama 74, 340
Luxembourg 2,590
Croatia 55,960
Dominican Republic 48,310
Ireland 68,890
Bayelsa2.3
Kano 13.0
Oyo 7.7
Katsina7.7
Kaduna 8.2
Lagos 12.4
Lagos 3,671
Borno72,609
Niger 68,925
Bauchi49,119
Taraba56,282
Yobe46,609
Most populated regionNorth-West 48.7m
Largest regionNorth-East: 280,419 km2
Smallest regionSouth-South: 76,852 km2
Least populated regionSouth-South: 20.6m
Denmark 42, 262
Spain 46.6m Italy 294,140 km2
Sri Lanka 21.44m Czech 77,210 km2
8
Improving Nigeria’s business
environment
9
Note: Size of bubble
reflects relative GDP
of each country
Southern Africa
East Africa
West Africa
Increasingly friendly business environment
Increasing population
South Africa
Nigeria
Angola
Senegal
Kenya
Ethiopia
Côte d'Ivoire
Cameroon
Tanzania
Equatorial Guinea
Ghana
Uganda
Togo
Zambia
Botswana
0
20
40
60
80
100
120
140
160
180
200
0 20 40 60 80 100 120 140 160 180 200
Population (millions)
Ease
of
do
ing
bu
sin
ess
(ran
kin
g)
Nigeria: a strategic market, undergoing dynamic changes and transformation
Target
Source: World Bank Doing Business Report 2017
Nigeria is the emerging economic locomotive of the
African continent
▪ Largest population on the continent and 7th in the world
▪ Largest GDP in Africa
▪ Largest gas reserves and second largest oil reserves in
Africa
10
Africa’s investment attractiveness
Source: EY’s 2015 Africa Attractiveness Survey
Biggest draws: natural resources, high growth rates
and large domestic markets…
…yet concerns about business
environment persist
11
Africa’s perceived barriers to investment…
Source: EY’s 2015 Africa Attractiveness Survey
Business environment is most important barrier…
… incentives are least important barrier
12Sources: Council on Foreign Relations, www.timeanddate.com/worldclock/distances.html
Above represents incidents motivated by political, economic or social grievances
Security concerns should not discourage investments
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
Deaths Per Month 12-month Moving Average
Security incidents have reduced… …and are far from commercial hub
Comparative flying distances
Ontario – Ottawa to North Carolina –
Fayetteville
1,182 km
Quebec – Montreal to Wisconsin, USA 1,192 km
Sambisa
Forest
13
Business case for improving business operating conditions
Strong correlation between economic prosperity and ease of doing business
R² = 0.4918
100
1,000
10,000
100,000
020406080100120140160180200
Income Per Capita (log scale) USD per person per year
# of Objs = 185
Nigeria
Brazil
South Africa
USA
Singapore
Norway
Doing Business Rank (2018)
Source: World Bank Doing Business Report 2018
14
Response: highest level commitment to ease of doing business reforms
Launch
No of announced reforms
No of initiativesParticipating
agenciesSuccess rate
February 2017 8 22 12 72%
October 2017 11 22 29 52%
February 2018 9 28 26 68%
Presidential Enabling Business Environment Council (PEBEC) inaugurated in July 2016
Remove critical bottlenecks
and bureaucratic constraints
to doing business in Nigeria
24
Up by 24 places in WorldBank’s 2018 Ease of Doing Business ranking
NAP 1.0
NAP 3.0
NAP 2.0
EO 1 May 2017 Transparency and improving the business environment
President Muhammadu Buhari, GCFR
Vice President Yemi OsinbajoSAN, GCON
Source: Enabling Business Environment Secretariat Reports
NAP: National Action Plan, EO: Executive Order
15
Global competitiveness index: Nigeria (115/140)
Source: World Economic Forum: The Global Competitiveness Report 2018
Performance overview 2018
Previous edition Lower income group average Sub-Saharan Africa average
2018
2017
115/ 140
125/ 137
Positive national
competitiveness ranking…
16
Starting a business
Dealing with construction permits
Getting electricity
Registering property
Getting credit
Paying taxes
Enforcing contracts
Protecting minority investors
Trading across borders
Resolving insolvency
120/ 190
149/ 190
171/ 190
184/ 190
12/ 190
38/ 190
157/ 190
182/ 190
92/ 190
149/ 190
+10
+2
+1
-5
-6
-5
+14
+1
-4
-4
2018
2017
2016
2015
145/ 190
169/ 190
170/ 189
170/ 189
+24
+1
0
-23
Rank Difference
2019 DB Ranking
Rank Difference
DB Year
Source: World Bank, Doing Business 2019
Nigeria’s ease of doing business score improved by 1.37 points
2019 146/ 190 -1
*DTF
52.89
51.52
44.63
43.56
44.69
* The distance to frontier (DTF) score measures the distance of each economy to the “frontier”, which represents the best performance observed on each of the indicators across all economies
Difference
+1.37
+6.89
-0.06
+1.14
-3.06
2019 Ease of Doing Business ranking: Nigeria (146/190)
… positive national doing
business score …
17
Subnational: Doing Business in Nigeria 2018
… positive subnational
doing business scores
Lagos
BayelsaRivers
Imo Abia
AkwaIbom
Adamawa
Bauchi
GombeKaduna
FCT
Nassarawa
Plateau
Taraba
Benue
CrossRiver
Enu
gu
Ebonyi
An
amb
ra
Delta
Edo
Kogi
Oyo
Ogun
Osun Ekiti
Ondo
Kwara
Niger
Sokoto
KebbiZamfara
Katsina
Kano
YobeJigawa
Borno
Source: World Bank, Doing Business in Nigeria 2018
In the past 4 years, 29 Nigerian states implemented
43 reforms across the four areas benchmarked.
Kaduna, Enugu, Abia, Lagos and Anambra showed the
largest advance toward the global good practice frontier
18
Nigeria’s economy
19
Recovery has been driven by non-oil sectors
25%
23%
2%
0.5%
0.3%
22%
9%
4%
4%
2%
1%
53%
17%
11%
7%
4%
3%
68
Agriculture
Crop…
Livestock
Fishing
Forestry
Industries
Crude Oil & Gas
FBT
Construction
TAF
Cement
Services
Trade
ICT
Real Estate
PSTS
Fin. & Insurance
Total
2017 (N trillion) Contribution to GDP (%)
2017Sector 2016
Industries
Agriculture 24.45 25.08
21.96 22.26
Growth Rate (%)
Services
Industries
Agriculture
(0.82) (0.91)
4.11 3.45
(8.85) 2.19
Total -1.58 0.83
FBT – Food, Beverages & Tobacco; TAF – Textile, Apparel & Footwear; ICT – Information
Communication & Technology; PSTS – Professional, Scientific and Technical Services; Fin & .. –
Financial and Insurance
5.82
8.37
8.02
7.0
Source: National Bureau of Statistics
2017Sector 2020E
91
9
Non Oil
Oil
Services 53.59 52.66
2020E
27.7
21.8
50.6
2016
20
Modest GDP growth…
FX reserves risen by 20% over last 12 months
305.31 305.83
494.70
359.00
Jan. 13 Jan. 14 Jan. 15 Jan. 16 Jan. 17 Jan. 18 Sept. 18
Inter-Bank Parallel/IEFX
Feb. 2017
Exchange rates kept relatively stable…
Inflation is 40% lower than the highs of 2017
62%
17%
Premium Price
Naira/USD
Annual growth rate, %
%
US$bn
Sources: Central Bank of Nigeria, National Bureau of Statistics
Cautious economic recovery
9.008.00 8.20
9.62
18.72
11.28
Jan. 13 Jan. 14 Jan. 15 Jan. 16 Jan. 17 Sept. 18
45.82
40.67
34.24
28.28 28.59
34.95
42.00
Jan. 13 Jan. 14 Jan. 15 Jan. 16 Jan. 17 Jan.18 Oct. 18
1.5
2013 2014 2015 Q12016
Q22016
Q32016
Q42016
Q12017
Q22017
Q32017
Q42017
Q12018
Q22018
Recession Period
21
Economic Recovery and Growth Plan (ERGP)
2017 - 2020
Restoring Growth
• Macroeconomic stability
• Economic diversification
Investing in Our People
• Social Inclusion
• Improved human capital
• Job creation and youth empowerment
Building a Globally Competitive Economy
• Investing in infrastructure
• Improving the business environment
• Promoting digital-led growth
Broad Policy Objectives
• Double manufacturing’s share of GDP
• Maintain a competitive exchange rate
• Reduce inflation from 18.6% to 9.9%
• Increase tax/GDP ratio from 6% to 15%
• Improve budget preparation and execution process
• FDI target of $10bn
• Create 15m new jobs
• Grow GDP at average of 4.62%
• Top 100 ease of doing business ranking by 2020
• Rebalance domestic/foreign debt from 84:16 to 60:40
Source: ERGP document
22
Services Manufacturing Agriculture Real Estate Oil and Gas Solid Minerals
• Increase internet
penetration from
47.4% to 75%
• Encourage local
production of ICT
hardware and
software
• Channel funding
to entrepreneurs
though
accelerators and
incubators
• Strengthen
enforcement of IP
rights
• Increase tourism
by 10% a year
from 2017
• Focus on agro-
processing and
industrial hubs
• Create forward
and backward
linkages among
industrial sub-
sectors
• Increase local
content in raw
materials and
machinery
• Increase export
potential of
manufactured
goods
• Increase R&D,
technology and
innovation
• Ensure self-
sufficiency in
tomato paste, rice,
and wheat
• Become net
exporter of key
agricultural
products
• Fast-track the
development and
execution of
irrigation projects
• Extend the Anchor
Borrowers
Programme to all
States and major
crops
• Recapitalize
Federal Mortgage
Bank from N2.5b
to N500b
• Mobilize private
capital through
Government seed-
funding in roads,
housing, and
agriculture
• Deliver 2m
housing units via
Family Homes
Fund
• Invest in technical
& vocational
training needed by
the industry
• Increase oil
production to 2.5
mbpd
• Accelerate
building of critical
pipeline
infrastructure
• Promote domestic
use of LPG and
CNG
• Increase local
refining capacity
• Develop domestic
gas infrastructure
for power and
domestic
consumption
• Facilitate
development of
coal to fire power
plants
• Integrate artisanal
miners into formal
sector
• Integrate mining
transport and
power needs in
national
implementation
plans
• Produce geological
maps of the entire
country
$67.5b $35.7b $25.5b $21.8b $15b $3.9b
ERGP: Priority sector objectives and private sector investment requirements
23
ERGP Focus Labs
Focus labs
◼ Can unlock US$ 22.5 bn of private investments by 2020 across various sectors of the economy:
– Agriculture: US$ 1.2 bn Transportation: US$ 3.5 bn
– Manufacturing: US$ 5.9 bn Solid Minerals: US$ 3.3 bn
– Gas: US$ 2.0 bn Power: US$ 6.5 bn
◼ Target creation of 514k jobs by 2020
◼ ‘Most ready’ to go: US$ 10.9 bn of the investments
◼ Identify projects to drive growth, increase private investments and create new jobs
◼ Mobilize private capital to finance projects
◼ Harness private-public partnerships
◼ Achieve economic diversification, inclusive and sustained growth
Results
Objective
Agriculture Manufacturing Power Supply
Solid MineralsTransportation Gas
Pre-Labs
8 weeks
Labs
6 weeks
Post-Labs
3 weeks
January 15 - May 12 2018
24
Compendium of Investment Incentives in Nigeria
◼ Compilation of fiscal incentives in Nigerian tax laws and duly approved sector-specific incentives
◼ 6 principal sections
– Investment policies and protections
– General tax-based incentives
– Sector-specific incentives
– Tariff-based incentives
– Export incentives
– Special Economic Zones
◼ First step in understanding impact of incentives in achieving Government’s economic objectives and considering incentive reforms
◼ Available at www.nipc.gov.ng
25UNECA – United Nations Economic Commission for AfricaUNCTAD – United Nations Conference on Trade and Development
iGuide Nigeria
◼ An easy-to-use online investment guide that provides investors with up-to-date and pertinent information on the processes, procedures and basic costs of doing business in Nigeria
◼ It provides information on Starting Business, Labour, Production Factors, Land, Taxes, Investor Rights, Growth Sectors and Opportunities
◼ The information will enable investors to make better informed decisions on Nigeria as a preferred investment destination
◼ Available at:
– www.theiguides.org/nigeria
– www.nipc.gov.ng
26
WIP: Investment opportunity profiling
◼ Profile investment opportunities across Nigeria
– Existing opportunities
– New projects (brownfield or greenfield)
– Public Private Partnership projects
– Prospective investors seeking opportunities
◼ Standardised template
– To be used by all IPAs in Nigeria
– Supported by a Toolkit for Investment Profiling
◼ Database of investment opportunities
– Maintained by NIPC
– Analysed, by economic impact, sector, region, state
– Summarised, for presentations and matchmaking
– Abridged, in deal books
– In full, for serious investors
Coming soon!
27
Tracking Global Sectoral
Investments
28
Global sectoral investing countries, 2016
0
500
1,000
1,500
2,000
2,500
3,000
0
20
40
60
80
100
120 Number of projects FDI outward stock (US$' m)
0
100,000
200,000
300,000
400,000
500,000
600,000
0
50
100
150
200
250Number of projects FDI outward stock ($' m)
Agriculture Solid Minerals
Source: Investment Map by International Trade Center (ITC)Based on cumulative values as at 2016
29
Global sectoral investing countries, 2016
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000Number of projects FDI outward stock ($' m)
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
4,500,000
5,000,000
0
5,000
10,000
15,000
20,000
25,000 Number FDI outward stock ($' m)
Manufacturing Services
Source: Investment Map by International Trade Center (ITC)Based on cumulative values as at 2016
30
Global sectoral investing countries, 2016
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
0
100
200
300
400
500
600 Number of projects FDI outward stock ($' m)
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
0
500
1000
1500
2000
2500
3000
3500 Number of projects FDI outward stock ($' m)
Real Estate & Construction Business Services
Source: Investment Map by International Trade Center (ITC)Based on cumulative values as at 2016
31
Global sectoral investing countries, 2016
Power Oil Refining
Source: Investment Map by International Trade Center (ITC)Based on cumulative values as at 2016
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
100,000
0
50
100
150
200
250
300
350
400Number of projects FDI outward stock ($' m)
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
0
50
100
150
200
250
300
350
400
450
500 Number of projects FDI outward stock ($' m)
32
Why Canada?
Source: NIPC Intelligence
#1 investor in Nigeria
#4 investor in solid
minerals
Top 10 Jobs creator in Nigeria
Top 10investor in oil refining
Top 10investor in services
Strategic businesspartner
33
Investor Obligation and Protections in the NIPC Act
ICSID = International Centre for Settlement of Investment Disputes
Registration Obligation
•Enterprises in which foreigners can participate are required to register with NIPC before commencing business
Ownership
•Nigerians and foreigners can invest in any sector, except for those on the negative list
•No restriction on foreign percentage ownership
Guarantees
•Government will not nationalize or expropriate any enterprise
•Right of access to courts and fair and adequate compensation if acquisition is in national interest/for public purpose
•No restriction on repatriation by foreigners of investment returns or sale proceeds through an authorized dealer
Dispute Resolution
•Amicable resolution by mutual discussion or arbitration of investor/government disputes
•Provisions of any Bilateral Treaty with the investor’s country will apply
•Right of recourse to international arbitration under ICSID Rules
34
About NIPC
35
Nigerian Investment Promotion Commission (NIPC) was established by the NIPC Act 16 of 1995 to encourage, promote and co-ordinate investments in Nigeria
• Promote Nigeria as an attractive investment destination
• Provide information on investment opportunities and capital sourcesProject Attractive Investment Image
• Promote investments in Nigeria, by Nigerians and non-Nigerians
• Co-ordinate all investment promotion activities in Nigeria
Investment Promotion
• Provide support services to investors and register enterprises in Nigeria
• Match-make investors with specific projects and advise on partners for JVs
• Provide information on investment incentives and approve Pioneer Status Incentive applications
Investment Facilitation
• Initiate and support measures that enhance the investment climate
• Evaluate the impact of investments and incentives in Nigeria and make appropriate recommendations
• Advise Government on policy matters to promote Nigeria’s economic development
Policy Advocacy
NIPC’s principal functions
36
One-Stop Investment Centre (OSIC) at NIPC
▪ Houses 27 agencies to facilitate investments and reduce time required to process regulatory approvals and permits
▪ Provides assistance with information and requirements from incorporation to expansion
▪ Also supports with business visa facilitation
Sample business
entry scenarios
Software development and creative industry
Drug Manufacturing for export
Type of Business Generic Agencies Specific/Sector Agencies
PowerGeneration
37
Yewande SadikuExecutive Secretary/CEO
[email protected]@nipc.gov.ng
NIGERIAN INVESTMENT PROMOTION COMMISSIONPlot 1181 Aguiyi Ironsi Street
Maitama DistrictAbuja
www.nipc.gov.ng
For further details, please contact us
