The Nigerian Economic Summit Group has said Nigeria is in dire need of investments to return the economy to the path of growth. The NESG, a private sector-led think-tank, said the COVID-19 pandemic had made investors apprehensive about making further investments in the Nigerian economy.
“This is coupled with the fact that savings drastically diminished as people lost jobs and unemployment worsened. More broadly, with a 21 per cent decline in global markets and 28 per cent in Africa specifically, COVID-19 has adversely affected investment flows into Nigeria and worldwide,” the group said in its NES 26 report.
It said the decline in global investment further created a dismal outlook for Nigerian micro, small and medium enterprises as investment inflows were suboptimal before the pandemic. The NESG said, “Even though they constitute over 70 per cent of Nigerian businesses, the ability of Nigeria’s MSMEs to upscale is now limited more than ever.
“It is, therefore, pertinent that Nigeria takes proactive steps to prepare and open up early for foreign investment. Strategic moves to reposition the Nigerian investment landscape must include automation of investment processes, ease of doing business reforms, and investment promotion policies and incentives.
“Also imperative is the need for governments at all levels to urgently and actively mitigate divestments in their respective jurisdictions.” The group urged the government to implement sectoral reforms that would help attract investments into key sectors and sustain an enabling environment for private investors ‘as Nigeria is in dire need of investments to return the economy to the path of growth’.
“Nigeria must explicitly state its policy direction with clarity to foster confidence in the investment ecosystem,” it said. According to the report, unsustainable exchange rate policy and perpetual infrastructure deficit inconsistencies in exchange rate policies have created confusion for businesses and demonstrated a sense of haphazardness in exchange rate policy design.
“Years of inadequate investment in infrastructure have impeded the Nigerian economy’s growth, with current indications suggesting Nigeria will be unable to meet its infrastructure development gap estimated to require $10Bn over 30 years,” it said.