Vice-President Yemi Osinbajo says foreign investors have nothing to worry about as there are no laws limiting foreign participation and investment in any sector of the economy. Osinbajo, who was represented by the acting Director-General, Securities and Exchange Commission, Ms Mary Uduk, at the 2019 FMDQ Capital Market Conference in Lagos, said though there were no limits to investing, the Federal Government had simple and clear procedures for capital repatriation.
He said there was an increased need to attract investment into the country and make investors see Nigeria as a compelling destination of capital because capital is central to economic growth and development. According to him, countries that are currently enjoying economic prosperity have been observed to have experienced transformation in their human and physical capital, which is facilitated through the process of attracting, accumulating and effectively deploying financial capital.
Osinbajo stated that as a country, more capital was required to grow, develop and attain full potential. He said, “We need to mobilise domestic savings and capital, as well as attract the necessary foreign capital to finance our needs in the areas of infrastructure, agriculture, mining, industry, housing, Small and Medium Enterprises, information and communication technology, transportation and other services.
“Taking infrastructure as an example, an African Development Bank report on Nigeria’s Infrastructure Plan in 2013 estimated that Nigeria would need to invest about $350bn in 10 years in order to meet up with its peers while other sources have estimated a slightly higher figure. “In recognition of this need, the administration of President Muhammadu Buhari is doing everything possible to close the gap in our infrastructure deficit. This is being done through our direct expenditure and also by incentives given to private investors, domestic and foreign, to invest in the critical sectors of the economy.”
Osinbajo added that the need to attract capital was further underscored by the Economic Recovery and Growth Plan initiatives such as the promotion of innovation and technology-led industries, encouragement of private equity and venture capital players, as well as the issuance of green, infrastructure and diaspora bonds towards sustainable financing.
He noted that between February 2017 and November 2018, the Federal Government explored the international market to raise capital by issuing series of Eurobonds and a Diaspora bond as part of its policy to restructure the country’s debt towards cheaper, longer-term foreign capital and, therefore, compete less with domestic borrowers.
According to him, the approach to diversifying sources of capital assisted in making the country a destination of capital and further deepened the capital market. He said the government recognised that it alone could not muster and deploy enough resources necessary for Nigeria’s development due to competing and rising needs, as well as challenges in revenue sources and collection.
He stated that with interest rate below two per cent in the United States and other advanced economies, it was expected that capital would flow into the country, given improved global liquidity and relatively higher domestic returns.