Much Ado about Nigeria’s Zeal to Woo Foreign Investors

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Last week’s investment roadshow to Silicon Valley in the United States of America, led by Vice President Yemi Osinbajo, is one among several moves by Nigerian government to woo foreign investors, who, however, remain skeptical about the poor level of infrastructure and the political uncertainty of the country, writes Emma Okonji

Global economies grow through foreign direct investments (FDI), because investors are looking for where to invest their money, and get unhindered returns on their investments. From United States to China, India, Japan, South Korea to Germany and even in African countries like South Africa and Kenya, FDI has been the driving factor responsible for economic development. 

However, investors are not willing to invest in countries where the infrastructure level is still low, because ubiquitous infrastructure speeds up development and enhances quick returns on investments. No investor will want to invest in a country where broadband infrastructure is abysmally low and where telecoms infrastructure is not evenly distributed. Such is the situation with Nigeria that is still struggling to raise its infrastructure to a level that will attract FDI, yet the government is busy seeking for foreign investors that will bring their hard earned monies to invest in Nigeria where the political environment is tensed and its level of infrastructure still low. 

Roadshow 

Vice-President Yemi Osinbajo, last week, led a public-private sector collaborative investment roadshow to the United States, where he spoke to global industry leaders in information technology and entertainment at the Silicon Valley in San Francisco and Hollywood in Los Angeles, California, from Monday July 9 to Wednesday July 11.

The Senior Special Assistant to the Vice President on Media and Publicity, Mr. Laolu Akande, who disclosed this in a statement, said Osinbajo was joined on the investment roadshow by members of the recently-inaugurated Advisory Group on Technology and Creativity – an integral part of the National Industrial Policy and Competitiveness Advisory Council.

Akande said the roadshow was designed to showcase the continued improvement in Nigeria’s business environment to entrepreneurs, investors and business leaders in both American cities.

He added that during the trip, Osinbajo emphasised on a number of the present administration’s policies such as the Ease of Doing Business reforms, which he said have improved the country’s ranking in the World Bank’s Ease of Doing Business Index 2017.

Osinbajo used the occasion to visit the headquarters of Google in Silicon Valley, where he met with the CEO of Google, Mr. Sundar Pichai, and he was given a rousing welcome with his team. 

Other aspects of the Vice President’s trip were to showcase to the world the progress and strides in the country’s technology, innovation and creative space by Nigerian technology start-ups and entertainment industry practitioners.

Advantages

Looking at the economic advantage of the Osinbajo led roadshow to Silicon Valley in US, some technology experts said the visit would afford the Vice President the opportunity to see modern technology developments in Silicon Valley and ensure that such technologies are replicated in Nigeria, through the right policy formulation and implementation. They were of the view that the technology start-ups that accompanied Osinbajo on the roadshow, would be exposed to modern technology development and be inspired to become more creative in developing solutions that would address the Nigerian business audience. For example, during the trip, some leading Nigerian start-ups had the opportunity for pitches about their ideas and products in order to promote investment by US companies in Nigeria’s technology and creativity sector.

The visit to Silicon Valley also focused on collaboration between Nigerian and US companies in the areas of technology and entertainment, including further cooperation between Nigeria’s film industry, Nollywood, and US Hollywood in the areas of production, distribution and content protection.

Another objective of the investment mission is to attract Africans in the Diaspora to mentor and support start-ups in Nigeria.

According to Akande, the Vice President was accompanied on the trip by the Minister for Industry, Trade and Investment, Dr. Okey Enelamah; Special Adviser to the President on Economic Affairs, Dr. Adeyemi Dipeolu; as well as senior government officials from the Nigeria Investment Promotion Council (NIPC) and the Nigeria Export Promotion Council (NEPC) Ease of Doing Business Secretariat, among others.

Investment Destination 

In spite of the advantages that the Osinbajo-led team to Silicon Valley would bring to the country, some other technology experts were of the view that wooing foreign investors to invest in the country, should not be the first step to be taken by government. The experts said government must first develop its country and allow investors to be attracted by the level of development in the country, to invest in the country. They argued that once the right infrastructure is put in place, investors who are looking for places to invest their money, would be attracted to the country, rather than the government spending so much money to woo foreign investors. 

Tech Start-ups

The President of the Association of Telecoms Companies of Nigeria (ATCON), Mr. Olusola Teniola, who commended the federal government on its move to further develop the Nigerian economy, through its recent move to Silicon Valley, however stressed the need for government to develop technology start-ups, whom he said, needed funding to expand and commercialise their technology solutions that were locally developed. 

According to him, Nigerian start-ups are innovative and could develop technology apps that could address local challenges in the country, but they need the financial push and mentorship that will make them competitive to excel. Investment in start-ups is a sure way to promote technology development of a nation, Teniola said. 

Commitment 

In addressing the issue of foreign direct investment, the Chairman, Association of Licensed Telecoms Operators of Nigeria (ALTON), Mr. Gbenga Adebayo, said the federal government must first show commitment in addressing the challenges impeding economic development in the country, before thinking of wooing foreign investors. Adebayo who decried the impunity at which government agencies shut down telecoms facilities across the country, in an attempt to collect multiple levies and taxes from the telecoms operators, said such actions have caused more harm than good to the telecoms sector, causing service disruptions across the country. According to him, destruction of telecoms facilities could lead to total collapse of the telecoms infrastructure and also discourage foreign investors from investing in the country, no matter the level of personalities involved in any delegation or roadshow that are designed to woo foreign investors. 

Speaking about the recent picketing of MTN offices across the country by the Nigerian Labour Congress, where telecoms facilities were switched off and tampered with, Adebayo said it was unbecoming of government agencies to attack telecoms facilities across the country with impunity, regardless of the implication of telecoms service disruptions. He therefore called on the federal government and the Nigerian Communications Commission (NCC) to intervene quickly to save the country’s telecommunications system from total collapse. 

According to him, attempts have been made to disrupt the network operations of some of our members through the shutdown and vandalism of critical network activities. The implication of such disruption will lead to severe poor quality of service with attendant natural security implications and far-reaching implications on other services that are dependent on the telecommunication industry.

Collaboration 

The Chief Executive Officer of MainOne, Ms. Funke Opeke, had told THISDAY in an interview that the best way to grow the Nigerian economy was through government collaboration. 

“For me as a business solution company, I think implementation of the country’s national broadband plan has been rather too slow for rapid business growth for a nation like Nigeria, where broadband penetration level is still at its lowest ebb of less than 30 per cent penetration,” Opeke said.

Rwanda for instance, came out of war that almost consumed it as a nation, but after that, the country set its priorities right and came up with fantastic structure that placed all telecoms service providers in the country on the same slate, such that no operator takes undue advantage of the small size of other operators to stifle their business. Today, Rwanda has been able to  have internet access in every public venue in the country. This was achieved through a collaboration between the national and regional authorities of that country. This is the type of collaboration we are canvassing for in Nigeria to drive broadband penetration to all nooks and crannies of Nigeria, Opeke added.

In Nigeria we have all manners of reports where state and local governments impose arbitrary fees on telecoms operators and in the process, stop them from expanding their infrastructure that is meant to boost broadband development in the country. Government must first address all these challenges and make the Nigerian economy attractive for investors, before wooing investors, she stated.