UK and Nigeria: An Enduring Investment Partnership

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By Helen Grant

A year ago, this week, President Buhari, federal government ministers, state governors and over 70 senior Nigerian business leaders, were in London for the UK-Africa Investment Summit; arguably one of the biggest Nigerian delegations ever to visit the UK. The summit helped secured £364 million in announced deals between the UK and Nigeria. But above all, the summit was about connecting governments, businesses and investors with each other; matching UK capital and expertise with exciting projects and business initiatives. I was privileged to play a role in several of the summit sessions with African Heads of State and Government, including chairing panels on breaking down barriers to trade and encouraging investment in clean energy. And I had the privilege of meeting some truly inspiring Nigerian Female Tech Founders whom the UK-Nigerian Tech Hub have been supporting and mentoring.

In that same week in January 2020, there were reports of a new virus starting to spread around the world. I don’t think anyone foresaw how much COVID-19 would come to dominate our lives in the following twelve months. Both the UK and Nigeria have had to focus on addressing the challenges of COVID-19, particularly the unavoidable shutdown of normal business activity for significant periods in 2020. As a Member of Parliament in the UK, I have seen how businesses, communities and families have struggled with the pandemic, while also adapting in often ingenious ways. As someone with a proud Nigerian heritage from my father, I have watched closely many of the same struggles, and similar resilience, in Nigeria.

When Prime Minister Boris Johnson appointed me as Nigeria Trade Envoy last October, I quickly understood that one of my most important roles would be to foster the UK-Nigeria trade and investment partnership to help boost a recovery that will create jobs, but also to grasp the opportunity to build back better and more sustainably. The latter will feature prominently this year as the UK Government prepares to host COP 26 and deliver a much needed further move towards a low-carbon and nature-based global economy.

One of the reasons why I was so keen to accept the Federal Government of Nigeria’s invitation to visit Nigeria last month, was to resume following-up on what the UK-Africa Investment Summit had started, while also taking into account the unprecedented challenges of 2020. Based on my conversations there in December with the federal government, state governors, Nigerian and UK business, I am convinced of the great opportunities of bringing more UK capital and expertise to support key sectors of the Nigerian economy; Sectors such as power and transport infrastructure to mention just two, where investment can really drive Nigeria’s recovery. UK companies are already active here in power generation and distribution projects in states as diverse as Bauchi, Kaduna and Ogun, but we are keen to bring more investors that can share their expertise more widely, perhaps using alternative models such as Public Private Partnerships (PPPs).

I also heard and saw for myself, during the visit, the important role that existing UK investors played in Nigeria during the pandemic, and continue to do so, which brought home the importance of retaining, as well as attracting investment. Many of these companies have invested in Nigeria for decades. Many will think of investors as mainly working in the oil and gas sector. But UK companies employ tens of thousands in sectors as diverse as financial services, pharmaceuticals, consumer goods manufacturing, food and drink, and waste management services. And they have stayed committed to Nigeria: according to the most recent available figures from the UK Office for National Statistics, the stock of UK investment in Nigeria is worth over £4 billion and Nigeria remains the second biggest destination for UK outward direct investment.

An important part of retaining investment is to create an environment which will not only attract companies but encourage them to stay. Since COVID-19 started to affect growth and normal business last spring, Nigeria deserves credit for intensifying reforms such as removing fuel subsidies and taking the first steps towards making power sector commercially viable. Other reforms ranging from the Companies and Allied Matters Act to licences for payment service banks to expand access to mobile money, are welcome.

I very much hope that the impetus will continue, even intensify, and that was another theme of my discussions with ministers and leading decision-makers. One of several issues we talked about was the federal government’s commitment to make customs clearance easier for businesses. Some UK technical assistance is supporting work on the Single Window portal for clearing exports and imports. This is good for Nigeria, because it will help competitiveness and support diversification by making it easier for companies to export non-oil products. It is also in the UK’s interest to make it easier for UK investors in Nigeria to bring in essential imports that will boost their business operations, enable to grow and create new jobs. We are keen to continue working together with the federal government to implement these changes.

Another area that I have focussed on in my first months as Trade Envoy, has been improving the conditions for trade in legal services between the UK and Nigeria. This follows three years of working alongside London’s world class Judicial College, formulating and delivering a State level Judicial Training Programme for judges and court staff in a growing number of states, including; Kaduna, Niger, Imo and Sokoto. Reinforcing a strong justice system and the rule of law is, I believe, critical for the maintenance of a favourable investment environment.

Continuing to address any policy or regulatory issue to make business easier – be it steps to accelerate customs clearance, or ensuring adequate access to the foreign currency essential for investors to keep their businesses operating – is an important way to show the value the government places on investment retention. It is also something that potential new investors will look at in their due diligence.

Which brings me to today’s virtual Africa Investment Conference, for which I am pleased to report over 190 Nigerian participants have registered to take part. Not only does the conference mark the one-year anniversary of the landmark UK-Africa Investment Summit, but it is also a reminder of what potential UK investors can offer and the support available from the UK Government. I look forward to reacquainting with contacts and friends, as well as making some new ones.

The conference is looking at four particular sectors: sustainable infrastructure, renewable energies, financial and professional services, and agriculture and agritech. I’m delighted that this is such a good fit with the priorities for Nigeria’s government and its private sector. These are also sectors where I am already looking to help Nigerian and UK companies, including a particularly exciting potential partnership on cutting-edge agricultural technology. Others will welcome a reminder of the opportunities to match demands for capital in Nigeria withS the deep and sophisticated financial markets in which the City of London excels.

I’m confident that the Nigerian attendees will find the conference helpful for making UK companies aware of the diverse range of opportunities in Nigeria and her attractions, not least the size of the domestic market.

Although this is a virtual conference, I look forward to physically returning to Nigeria very soon. As the Prime Minister’s UK Trade Envoy, there is much for me to do to help convert the immense goodwill that exists between our two countries, into the business deals and partnerships which will make a sustainable, investment-driven and job-creating recovery a reality. I am relishing the challenge with open arms.

*Helen is the UK Prime Minister’s Trade Envoy to Nigeria