Nigeria is the most populous country in Africa with over 200 million people and also the largest economy in Africa with gross domestic product (GDP) of $446.543 billion US dollars in 2019.With abundant natural resources; the potential growth of the economy is limitless.
While there are diverse opportunities for interested investors in Nigeria, it is important to applaud the strategic move by this current administration to fix and upgrade broken infrastructure affecting the economy.
This makes it worthy to highlight the development of Nigeria railway sector under the leadership of the minister of transport- Rt.Hon. Rotimi Chibuike Amaechi whose drive and determination deserves commendation for total transformation of Nigeria’s railway sector.
Other areas where the minister needs to be commended are his ability to persuade Chinese construction firm China Civil Engineering Construction Company (CCECC) to construct a Transportation university in Nigeria, the training of 150 young Nigerian students in railway engineering in China as well as the building of a railway rolling stock assembly plant in Kajola, a town in the south-western state of Ogun.
While it is important to commend this administration for a job well done in the railway subsector, we must also appeal to them to direct same efforts to other transport institutions such as Nigeria Ports Authority (NPA), Nigerian Maritime Administration and safety Agency (NIMASA), Nigeria Shippers Council (NSC), Maritime Academy of Nigeria, Nigerian Inland Waterways (NIWA) etc.
Also worthy of note is the strategy of the governments investment in the railway, agriculture and information technology sector which has yielded high results as well as given a boost to the economy.
While the launching of the Economic Recovery and Growth Plan (ERGP) by this administration in 2017 also led to a review of previous economic policy decisions, it is important to point out that this new policy also included an investor and exporter foreign exchange window (IEFX) as well as tightening of monetary policies.
Some of the priorities of the ERGP include improving transportation infrastructure, driving industrialization, focusing on SMEs, stabilizing the macroeconomic environment and achieving agriculture and food security.
Therefore, revamping the sector will be of tremendous benefits in boosting competitiveness as well as opening up Nigerian economy for more foreign direct investment and employment opportunities.
Also, Nigerian health and educational sector such as Universities, Polytechnics and other institutions can also increase their market share, if same determination and strategy used in the railway subsector can be applied.
Their capacities in areas such finance, training, technology etc can be boosted by so doing; thereby attracting medical and educational tourists which will make Nigeria a global hub for education and healthcare.
In addition to the successes achieved so far in the railway sector, we can form partnerships with nations such as USA, UK, China, Netherlands, Belgium, Denmark, Singapore ,Germany, Australia, Canada etc to learn from what they have done to achieve success in their transport sectors such as maritime, road etc. If this is done, it will create multiplier effects in our economy as well as stimulate high return on investment (ROI).
For instance, transportation sector contribution to Nigeria’s GDP increased from $642.927 to $720.241 million in the third quarter of 2019 as well as its contribution of 2.49 percent to nominal GDP in Q1 2019 increased from 1.85 percent recorded in the corresponding period of 2018which was higher than 2.05 percent recorded in the fourth quarter of 2018.
While Nigeria’s transportation sector has enormous resources, it is yet to be fully explored despite the relentless efforts of this administration. Aside crude oil, Nigeria is blessed with diverse natural resources such as gas, tin, iron ore, coal, limestone, lead, zinc, arable land, deep ocean, vast seas which are worth billions of dollars and there is no denying the fact that Nigeria has tremendous opportunities for foreign investors in the sector (railway, pipeline, airways, maritime and land).
There are two major ways for investors to look at opportunities in Nigerian Transportation sector. For example, they can look at foreign portfolio investments that includes investments in stocks and securities of an existing Nigerian Transportation company (Railway, Maritime, Air, pipeline and Road transportation) or foreign direct investments (FDI) which involves establishing business organisation and acquisition of assets. They can also play actively in transport businesses in Nigeria.
Additionally, improving security, power supply, wages rates, labour skills, tax rates, size, political stability, exchange rate, access to free trade areas and streamlining the process for companies interested in doing businesses in Nigeria will also go a long way to attract foreign direct investments to Nigeria.
Aside the direct impact of FDI on the economy, it will also help improve knowledge acquisition and technical know-how of the working population through transfer of knowledge and skills which will help improve quality processes and production of locally manufactured goods. It will also boost export of locally manufactured goods in international market.
Some of the advantages of doing business and exploring the investment opportunities in Nigeria is taking advantage of the high population, abundance of natural resources, untapped target market, great economic potential due to large number of people, quest for modern transport infrastructure and technology, high demand for global imports, largest consumer market in Africa, investment incentives in exports oriented businesses.
Therefore, with the determination and performance of this administration in revamping and connecting the railway system, Nigeria economy is now better positioned to attract more investments opportunities. It is therefore important that Nigeria government prioritize the sector for more funding and development.
If this is done together with upgrading our policies and laws in line with current changes globally, Nigerian economy stands to be one of the most attractive globally.
Lastly, with Nigeria’s added advantage as the largest economy in Africa and the target of the present administration to deliver the dividends of democracy to Nigerians as well as provide quality life for its citizens, create more employment opportunities together with improving the socio-economic status of the citizens through provision of modern infrastructures to make the economy business friendly, Nigeria will be better placed as the new destination hub for investors globally.
