Committed to attracting more investments into Oyo State, Governor Seyi Makinde recently took to London his message of the State’s ready investment market.
The debut edition of the Oyo State International Business Summit, also known as OYSIBS 2023 held on Friday, May 19 at the Millennium Gloucester Hotel, London Kensington and was titled “Accessing the Pioneer Advantage to Sustainable Investments in Oyo State”.
In his presentation closely linked to the Summit theme, Governor Makinde who spoke on the topic, “Your All Access Card to Sustainable Investments in Oyo State – Follow the Data”, said his administration has prepared a programme that will provide investors with all they need to make an informed decision about investing in Oyo State.
Governor Makinde took time answering questions on the investment opportunities available in Oyo State, what investors will benefit from these opportunities, and what the Oyo State Government has done to ensure incoming investors get the support they need.
The investment opportunities, benefits
Notably, among others, the investment opportunities available in Oyo State cut across Agribusiness, Solid Minerals, Sustainable Energy, and Tourism.
“Oyo State has a comparative advantage in agribusiness. We have 2.85 million hectares of arable land and a climate and soil type suitable for most agribusiness enterprises. Right now, we are focused on building agribusiness industrial hubs. We have already shown proof of concept with the Fasola Agribusiness Industrial Hub. Some of the investors in this audience today are already subscribed to the hub.
“So, what we are doing at the hub is to have a built environment that supports various agribusiness ventures. We have livestock and crop production centres, warehouses for agro-logistics and more. We will start to work soon on Akufo, Eruwa and Ilora Farm Settlements to convert them into agribusiness industrial hubs. So, if you are an investor looking to develop one of our nine farm settlements in Oyo State, talk to us. We should be able to work out a Public Private and Development Partnership,” the Governor said.
“This partnership involves building infrastructure that will make the area more business viable. For instance, to make the Fasola Agribusiness Industrial Hub accessible, we are reconstructing the 34.85 km Oyo-Iseyin Road. In the next few years, we shall also be injecting $40 million into the livestock value chain through the World Bank-assisted Livestock Productivity & Resilience Support Project (L-PRES). This will ensure that investors get the infrastructural support required in livestock production”.
“This is one of three new entrants into the Oyo State investment portfolio. Many people have asked how we intend to attract investments into the solid minerals sector, whereas all minerals belong to the Federal Government. The answer lies mainly in the Pacesetter Mineral Development Company (PMDC). The PMDC is the Special-Purpose Vehicle we have used to acquire solid minerals titles. We have exploration and mining titles. After surveying the areas where we hold titles, we created a database of minerals on those titles”.
“I can tell you that we have deposits of Feldspar, Talc, Marble, Pyraiba, Gold, Tourmaline, Quartz, Beryl and Granite. So, when you choose to partner with Oyo State, we will be able to tell you how much of a deposit of each of these minerals we have. That is one advantage of working with Oyo State in the solid minerals sector.
“Another advantage is that Oyo State now hosts the International Gemstone Market in Adan in Akinyele Local Government Area, Ibadan Zone. This collaboration between the Oyo State Government and the Federal Government shows how important the State is in the gemstone industry conversation. So now is the time to locate ancillary facilities in the State,” Governor Makinde told existing and prospective investors.
The Governor said sustainable energy is another not-so-new addition to the State’s investment portfolio. “I should say it is new in name only because we have been developing this sector since 2019. First, we created the Oyo State Ministry of Energy and Mineral Resources in 2019 primarily to develop policies and programmes to help the State meet residents’ energy needs.
“While the power sector was still mainly under the Exclusive List of the Constitution of the Federal Republic of Nigeria 1999 (as amended) and so under the Federal Government’s control, we found a way of showing proof of concept for alternative energy sources to underserved communities. We built five mini-grids in various communities. At the same time, private investors have come on board to provide Energy-as-a-Service (EaaS) to 17 more communities.
“Additionally, the State has worked with Fan Milk Plc to provide 1 MW of solar power and Nigerian Breweries to provide 600 kW with a plan to upgrade this to 3 MW. We also have the 11 MW Independent Power Project (IPP) and the Oyo State-Shell Nigeria Gas construction of a Pressure Reduction and Metering Station (PRMS), which will deliver an upside of 60 million standard cubic feet of gas per day to industrial, manufacturing and commercial entities.
“Following the devolution of powers in the sector, Oyo State has created the Oyo State Electricity Regulatory Commission, allowing partnership with the private sector on large-scale energy provision,” Makinde noted.
Speaking further, Governor Makinde said: “Oyo State is rich in culture and history. As a State, we have barely tapped the available potential. We have spent our first four years in office laying the groundwork for this moment. We now have the market and the supporting purchasing power as we are already experiencing massive growth in MSMEs doing business in the hospitality industry. From our records, we now have 5,342 MSMEs in this sector in Oyo State, up from 3,918. This is mainly because of the improved business outlook in the State. Oyo State receives over 10,000 visitors into the state daily. Some come to stay, others are passing by, and others stay for a while”.
“We are inviting you to invest in the Tourism sector. As you make this decision, bear in mind that we will be providing you with access to our database of all tourism sites in Oyo State and their unique features. You can also work with us in organising trade shows and other events that will be built around state-adopted cultural days,” he added.
According to Governor Makinde, one of the present administration’s core focus areas in the past four years has been infrastructural development. “We met a huge deficit when we came into office, and we knew that we needed to get things going quickly. We started with the bigger projects such as the 65 km Moniya-Ijaiye-Iseyin Road, the 34.85 km Oyo-Iseyin Road, the 76.67 km Ogbomoso-Fapote-Iseyin Road and the 48 km Ido-Eruwa Road.
“We are also working on completing the 110 km Senator Rashidi Ladoja Circular Road, which encircles the Ilutuntun Business District in Akinyele Local Government Area. I mentioned earlier that the International Gemstone Market Centre is in Akinyele Local Government Area. We plan to turn this zone into ‘the most futuristic growth corridor of the city of Ibadan’. So, within this radius, we also have the proposed Ibadan Inland Dry Port and the Railway Corridor. Do you already have ideas on how to collaborate with us? Let me mention that the Circular Road will be a tolled road, and we have already done the heavy lifting out there by constructing the first 32 km East-Wing and completing six bridges, including two interchanges along the route,” he said.
Here are key leverages to consider
While making reference to economic data he shared during his presentation, Makinde noted that such evidence puts Oyo State above the rest to be considered for investment, as he urged participants at the Summit to join the thousands of investors in Oyo State and benefit from the huge Return on Investment (RoI).
“Oyo State has a land mass of 28,454 square kilometres. To put that in perspective, it is about 18 times the size of London. We have an estimated population of over 8 million. Personally, I believe we are far more than that, but we need a census to prove that. Of this population, about 60 percent are between the ages of 16 and 54. So, it is fair to say we have a large working population.
“And so, demographically speaking, the data shows that Oyo State is a ready investment market. Our landmass and population provide a comparative advantage that very few States in Nigeria have,” the Governor said.
Ease of doing business
In 2018, the World Bank published one of its last annual Ease of Doing Business Reports for subnational Nigeria. In that report, it used four key indicators to rate Oyo State. These are: Starting a Business, Dealing with Construction Permits, Registering Property, and Enforcing Contracts.
Oyo State scored average to above average in three of these indicators. These are Starting a Business at about 76 percent, Dealing with Construction Permits at about 61 percent and Enforcing Contracts at about 53 percent. Though, the score for Registering Property was quite low at just about 22 percent. Oyo State scored 53.41 percent in the Ease of Doing Business index overall.
“Looking at this data, it was clear that there was a lot of room for improvement in property registration. So, after we assumed office in 2019, we got to work. First, we built on the Certificate of Occupancy (C-of-O) Made Easy Scheme, which our predecessors had tried to operationalise. Our goal was to ensure that properties could be registered in 60 days.
“We achieved a measure of success in this regard leading to an expansion of the project. It was renamed C of O Redefined, and commercial entities were pulled into the mix. This moved the emphasis to the business community,” Makinde noted.
“We did not stop there. We also looked at the other indicators that would attract big businesses to Oyo State. We worked on our regulatory environment. For example, we made the Bureau of Public Procurement a standalone agency and appointed a Director General who used to be a private sector player. One of the remits of this agency is to create opportunities for SMEs.
“Another thing we did was to create the Oyo State Public Private Partnership Agency (OYSIPA). The agency is the one-stop shop for investment opportunities in Oyo State. Because some of the compliance regulations that businesses must adhere to are within the purview of the Federal Government and there are bureaucracies associated with government in Nigeria as a whole, it became imperative to have an agency that would serve as a vital link to all these agencies. And this is what OYSIPA does,” he noted further.
Makinde noted further that his administration in Oyo State is working with the Presidential Enabling Business Environment Council (PEBEC) to implement the State Action on Business Enabling Reforms (SABER) Programme in the State.
“The PEBEC Secretariat and World Bank coordinate this project. So far, PEBEC has released two Ease of Doing Business Reports. The first was published in 2021, and the second in 2023,” he said.
PEBEC expanded the key indicators of Ease of Doing Business at a subnational level in Nigeria to include: Infrastructure, Transparency and Accessibility to Information, Secure and Stable Environment, Regulatory Environment, Skills and Labour, and Economic Opportunity.
Based on these terms of reference, Makinde noted that Oyo State showed a 2-point improvement in perception by Micro, Small and Medium Enterprises (MSMEs) in land and property acquisition going from 2.88 to 4.88.
He added: “Our administration shortened the process of obtaining Certificates of Occupancy to 60 days. We also made it easier to pay taxes through the adoption of technology. Today, you do not have to go to the agency to pay any bills in cash, you can do so online from anywhere in the world”.
According to the Governor, “The indicator where Oyo State performed best is Skills and Labour. Though Nigeria has been facing a skills crisis in the last two years, with so many middle-class people leaving the country, Oyo State has taken steps to ensure that education and skills acquisition are prioritised.
He told prospective investors that in the last four years, the State government has consistently maintained a 15-20 percent budgetary allocation to the Education sector in the State.
“With increased funding to all levels of the Education sector, including the tertiary level, one of the three State-owned universities, the Ladoke Akintola University of Technology has been rated the best State-owned university in Nigeria for the past four years,” Governor Makinde said.
Prioritised skills acquisition in sectors of comparative advantage
Governor Makinde also noted that Oyo State has prioritised skills acquisition in the sectors where it has a comparative advantage. “For example, as part of our focus on agribusiness in the last four years, we have trained over 4,000 youths across the agribusiness value chain, and another 1,500 youths have passed through our Start Them Early Program (STEP), which trains young people aged 13-16 on various enterprises in the agribusiness value chain,” he added.
“With these and other improvements done, Oyo State has been able to create a conducive environment for the private sector to thrive. One of the factors that our surveys revealed has played a key role in the decision-making process of MSMEs is the growing middle class in Oyo State.
“MSMEs rated Oyo State 5.83 in New/Range of Customers. Of course, this is always an important factor. We do not only have a large working-class population, but they also have spending power. We have ensured that about 8 percent of our working population who are government workers have received their salaries regularly and consistently in the last four years; an injection of N12 billion into the economy monthly,” the Governor added.
One of the top five economies in Nigeria
Makinde said: “Through all our efforts in these past four years, we have been able to better our economic standing among Nigerian States. It is on record that Oyo State is now one of the top five economies in Nigeria. We now have a GDP of $8.67 billion in 2022. This is a growth of about 50 percent in 4 years. The number of enterprises within the state grew to 1,872,941. And we attracted Foreign Direct Investment of $65 million”.