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Dangote Urges State Governments On The Need To Create An Enabling Environment To Boost Investment

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President of the Dangote Group, Aliko Dangote has urged state governments on the need to create an enabling environment to attract more private sector investment. He stated that no state in Nigeria is not blessed with mineral resources, which could serve as a potential for industrial growth.

He further disclosed that there is a strong need for the states to look inward and put in place favorable economic policies that would promote investment generation within States.

In his words, “When states provide an enabling environment, it will incentive the private sector to invest and it will be a win-win situation for both the state and the private sector”.

He gave an instance of Lagos state and the Lekki free trade zone, stating that the ease of doing business created by the state government had motivated private sector operators to establish companies within the area, thereby adding value to both the state and the nation’s economy.

He pointed out that the Nasarawa state government was able to attract the Dangote sugar plc multi-million dollar investment into the state due to its efforts to transform the state into an investment-friendly region.

Indeed an enabling environment is a key to boosting foreign investment in the country, which will no doubt positively affect the economy. The federal government must see the need to partner with private sectors to attract both local and foreign investors.

Asides from the effort of the federal government, there need to be all hands on deck from state governments to create an enabling environment in their states, to boost investment. Looking at the state of Nigeria’s economy, it demands that there is a need for economic diversification of mineral resources, which is present in all states in the country to deliver economic growth.

There is also the need for massive creation of industries, as well as expansion of existing industries to attract foreign investors. To achieve this feat, there must be the presence of focused and visionary leaders, and a well-thought-out institutional framework that will enable the creation of a sustainable conducive business and investment climate.

Also, there must also be friendly policies that will play an active role in attracting investors to invest in the country. What attracts investors is the enabling environment that the country provides which in the long run allows a business to thrive effortlessly.

Nigeria is richly blessed with 44 identified mineral resources across the 36 States, yet for many years, oil has remained the country’s top foreign exchange, while it imports some of these mineral resources present here in the country, which is not ideal.

Every state in Nigeria has exploitable solid minerals, yet it remains untapped. A look at Nigeria’s neighbor, Ghana, its mining industry provides 41 percent of its exports. Therefore, proper mining of these resources present in Nigeria can serve as a potential for industrial growth which will no doubt attract foreign investors.

There is a strong need for federal and state governments in the country to look inwardly and utilize these resources to develop the region, as well as attract foreign investors that will no doubt boost the nation’s economy.

As Chinese and Russian bombers fly jointly around Japan

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A Chinese H-6 bomber flies over East China Sea in this handout picture taken by Japan Air Self-Defence Force and released by the Joint Staff Office of the Defense Ministry of Japan May 24, 2022. Joint Staff Office of the Defense Ministry of Japan/HANDOUT via REUTERS ATTENTION EDITORS - THIS IMAGE WAS PROVIDED BY A THIRD PARTY.

The world is now broken into three: the West, China/Russia and the Un-allied. Today, according to CNN, “Chinese and Russian bombers jointly flew around Japan, Japanese Defense Minister Nobuo Kishi told reporters Tuesday, adding that the country’s Air Self Defense Force had to scramble its fighter jets and conducted surveillance…China’s Ministry of Defense confirmed that China and Russia’s air forces conducted joint strategic air patrols over the Sea of Japan, the East China Sea and the Western Pacific Ocean on Tuesday”.

 This is a turning point and what that means is that everyone is affected. People, Russia and China are forming their own version of NATO and they have become bold to make that known. President Joe Biden’s statement that the US will go to war to defend Taiwan means China has to shift on many things. It is no more hypothetical: the US will fight for Taiwan and because China truly wants to bring Taiwan home, alliances must be formed!

If the US goes to war, NATO follows. China sees a shift here; it needs an ally. For all nations in the world, only about 6 make useful military gear: – US, UK, “EU”, Japan, China, and Russia. The first four are entwined and the last two are coming together. 

If US/NATO wins in Ukraine and pushes Russia and China together, I am not sure that will be super-great for Europe. For all its recent shortcomings, Russia remaining aligned with Europe is better for the region, compared to having a strong Chinese military ally within Europe.

The Un-allied include Africa, Arab world and Latin America. They are in very complicated positions here: if you annoy US/NATO, they will stop selling you weapons. And if you annoy Russia, the same fate comes. 

So, Africa, for example, is going back to Dr. Kwame Nkrumah theory: no west, no east, just forward. In other words, Africa must not fight US “wars”, or “Russia ”wars”, but focus on moving forward as a continent – and that means America’s or Russia’s interests must not automatically become Africa’s interests. That is the current playbook in the continent.

If the state of the world now is not managed well, the world will break economically. I do not expect any military conflict at a global level but I expect a severe economic paralysis.

Many bad things could happen…I am concerned.

Japan scrambled jets after Russian and Chinese warplanes neared its airspace on Tuesday, when Tokyo was hosting the leaders of the Quad grouping of countries that includes the United States, Defence Minister Nobuo Kishi said.

Tokyo conveyed “grave concerns” to both Russia and China through diplomatic channels, Kishi said at a news conference that was broadcast online.

He characterised the incident as a likely provocation by both Beijing and Moscow on a day when U.S. President Joe Biden, Indian Prime Minister Narendra Modi and Australia’s newly elected leader, Anthony Albanese, were meeting in Tokyo.

Nigeria’s Economy Recorded 3.11% Growth in Q1 2022 – NBS

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The Nigerian Bureau of Statistics (NBS) revealed in its latest report published on Monday that Nigeria’s economy recorded 3.11% growth in the first quarter of 2022.

According to the figures published by the bureau, there’s sustained positive growth for the sixth consecutive quarter since the recession witnessed in 2020, when negative growth rates were recorded in quarters two and three of that year.

“The first quarter 2022 growth rate further represents an improvement in economic performance,” the report said. “The observed trend since Q4 2020 is an indication of gradual economic stability.

“The Q1 2022 growth rate was higher than the 0.51% growth rate recorded in Q1 2021 by 2.60 per cent points and lower than 3.98% recorded in Q4 2021 by 0.88% points. Nevertheless, quarter-on-quarter, real GDP grew at -14.66% in Q1 2022 compared to Q4 2021, reflecting a lower economic activity than the preceding quarter.”

The agency explained that in the quarter under review, the aggregate GDP stood at N45,317,823.33 million in nominal terms – a performance that was higher when compared to the Q1 2021 which recorded an aggregate GDP of N40,014,482.74 million, indicating a year-on-year nominal growth rate of 13.25%.

It added that the nominal GDP growth rate in Q1 2022 was higher relative to the 12.25% growth recorded in Q1 2021, and higher compared to the 13.11% growth recorded in the preceding quarter.

While broadly classifying the Nigerian economy into the oil and non-oil sectors, the NBS revealed that the nation recorded an average daily oil production of 1.49 million barrels per day (mbpd) in Q1 2022.

This value, it stated, was lower than the daily average production of 1.72mbpd recorded in the same quarter of 2021 by 0.23mbpd, and lower than the Q4 2021 production volume of 1.50mbpd by 0.01mbpd.

“Real growth of the oil sector was –26.04% (year-on-year) in Q1 2022, indicating a decrease of 23.83% points relative to the rate recorded in the corresponding quarter of 2021,” the report said. “Growth decreased by 17.99% points when compared to Q4 2021 which was –8.06%.

“Quarter-on-Quarter, the oil sector recorded a growth rate of 9.11% in Q1 2022. The oil sector contributed 6.63 per cent to the total real GDP in Q1 2022, down from the figures recorded in the corresponding period of 2021 and up compared to the preceding quarter, where it contributed 9.25% and 5.19% respectively.”

According to the data agency, the non-oil sector grew by 6.08% in real terms during the reference quarter (Q1 2022).

It explained that the rate was higher by 5.28% points compared to the rate recorded same quarter of 2021 and 1.34% points higher than the fourth quarter of 2021.

“This sector was driven in the first quarter of 2022 mainly by information and communication (telecommunication); trade; financial and insurance (financial institutions); agriculture (crop production); and manufacturing (food, beverage, and tobacco), accounting for positive GDP growth.

“In real terms, the non-oil sector contributed 93.37% to the nation’s GDP in the first quarter of 2022, higher than the share recorded in the first quarter of 2021 which was 90.75%, and lower than the fourth quarter of 2021 recorded as 94.81%.”

African Development Bank (AFDB) To Help Nigeria Return E-Wallet System In Agriculture

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The African Development Bank (AFDB) has disclosed its plans to help Nigeria to return to the electronic wallet system of input distribution to farmers to boost agricultural production.

According to the President of AFDB, Dr. Akinwunmi Adesina, he disclosed that the system allowed the government to register about 14.5 million farmers and reached them directly with inputs, notably seeds and fertilizers, via electronic coupons on their mobile phones.

He further disclosed that the bank would support Nigeria with about 30 million dollars in reallocated funds to be used for an emergency food plan to produce in the dry season.

While speaking at a meeting, ahead of the Bank’s 2022 annual meetings in Accra Ghana, he had this to say; “Nigeria needs to go back and use the electronic wallet system that I developed when I was a minister to get fertilizers straight to farmers and cut out all the middlemen. We are going to help the government to do that because when farmers have quality seeds and fertilizers, they can rapidly triple food production,” he said.

“In Nigeria, we have provided 540 million dollars for special agro-industrial processing zones in seven states including the Federal Capital Territory. “That will allow Nigeria to have special zones where you can have agro-processing value addition and increased competitiveness of agriculture. “We are not alone, we put in 170 million dollars and others put in money such as the Islamic Development Bank and other partners”.

The use of a wallet system in the Agricultural sector is a very great initiative, and it is ideal for it to be re-introduced because the use of mobile technology in recent times has been very beneficial, especially in the delivery of government inputs and services.

One beautiful thing about the wallet system is that once farmers are registered on it, it enables the government and other institutions to reach them directly, cutting out all the middlemen.

Looking at the high rate of corruption in Nigeria, in the past years, the Nigerian government has on several occasions supported the agricultural sector with funds and through the procurement and distribution of seeds, fertilizers, and other agricultural inputs to farmers in the country. Unfortunately, the middlemen entrusted to distribute such resources to these farmers end up siphoning billions of dollars, as well as selling some of these inputs to farmers which affected farmers’ productivity.

These farmers on countless occasions are only given a small percentage of government support, which has little or no effect on their production output. But with the e-wallet system, through subsidized electronic vouchers, inputs and resources are delivered directly to them. It is interesting to note that the e-wallet system has gained widespread adoption, with over ten million Nigerian farmers having access to it.

The system has no doubt eradicated corruption from middlemen as well as subsidy schemes, which has prompted banks and other institutions to see the agricultural sector as an interesting one, which has made them willing to lend funds into the sector, knowing full well that such funds and resources will get directly to the farmers.

It might interest you to know that the success of the e-wallet system in Nigeria, has impressed Kenya and Uganda, and both countries have decided to collaborate with Nigeria to introduce the wallet system in their country. The African Union on the other hand has encouraged the use of the wallet system implemented throughout Africa.

Nigeria’s aggregate agricultural output remains extremely low relative to other purchase farm inputs and obtains the required quantity at the right time. This is because farmers have been finding it difficult to procure and distribute users and seeds and have been faced with fraudulent
practices.

The poor distribution, as well as procurement of fertilizer, grossly affected farmers’ productivity and income, but with the re-introduction of the wallet system, such fraudulent practices will be drastically reduced which will improve farmers’ output and generate more income for the country.

Lagos is #1 Investment Destination City in Africa

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Lagos State recently emerged as the top destination in Africa for digital infrastructure investment, to the delight of its teeming fans.

It’s noteworthy Lagos has remained the most populous city in Nigeria and on the continent.

The above report was revealed in April 2022 during a panel hosted by Digital Infra Africa, where industry experts deliberated on the impacts of growing investments in data centres on the continent.

The session, which was moderated by Senior Vice President, Middle East, Africa and Greater India, Uptime Institute, Mustapha Louni, had MainOne CEO, Funke Opeke, joined by CEO of the Raxio Group, Robert Mullins; CEO, Teraco, Jan Hnizdo and Chief Marketing Officer and VP of the International Business Development, WIOCC, Mike Last.

These market leaders noted the spate of acquisitions and new entrants in the past six months including Equinix – MainOne’s new parent company, Digital Realty, Cassava Technologies and WIOCC.

They said growth in investments in the data centre infrastructure on the continent had grown exponentially, adding that such investments continued to be driven by the growth of broadband access and data consumption across the continent’s large economies, of which Nigeria was the largest.

Opeke stated, “When you look at the connected population and the growth potential of the numbers that remain unconnected, we see a large opportunity for growth in data consumption levels, and this is attracting global market players.

“MainOne is the market leader in Lagos already and we will continue to make investments with our new parent company Equinix to remain at the forefront of the increasing digitalization happening on the continent.”

“These views are in line with the recently published statistics on investments flowing into the tech sector on the continent. Lagos State government has actively championed these initiatives and investments in technology by creating an enabling environment for businesses to flourish, and also by providing active support to investors in the state through its numerous programs and initiatives.

“The effort is bearing fruit, as in the last one month, Lagos has attracted over $1 billion worth of committed investment from technology giants like Microsoft, which opened its new African Development Centre in the State; Google, which last week launched its state-of-the-art submarine Internet cable in Lagos and Equinix, which recently completed its acquisition of MainOne with a $320 million deal.

To put the level of investment that Lagos would attract in the next few years into context, at the recent launch of MainOne’s MDXi Lekki II Data Center, VP Growth and Emerging Markets at Equinix, Judith Gardiner, stated that, “Amsterdam as a key hub, with a population of one million people, has nine Equinix Data Centers with over 106MW capacity. Lagos, with a population of over 20 million, has the potential to far exceed this footprint.

“We are committed to bringing our capital, expertise, knowledge and customers to accelerate the digital age in Nigeria.” She hinted.

Indeed, Lagos has over the past and recent years taken the lead as regards investment destination owing to the seeming friendly and enabling environment. This prowess has made the state to relatively boast of the richest territory across the Nigeria’s shores.

The leadership of other states in Nigeria are required to step up their policies in a bid to ensure they key into the investment mantra towards boosting the Internally Generated Revenue (IGR) base of their respective jurisdictions. This would make them not to wholly depend on the central government for survival, as it’s currently witnessed in the country.

However, the Lagos government must strive to sustain the tempo, as well as revisit its various fiscal policies to ensure it becomes and remains friendlier than its present position, towards attracting more prospective investors to the state.

Governments at all levels must learn to acknowledge that the wholesomeness of every economic activity centres on policy-making and its onward implementation.