Shortly after the 100 day celebration of GEJ in autonomous power, internationally he makes a decision for the Nigerian economy which is worth discussing.
GEJ has built a strong economic and commerce team and I am keen to review and understand their policy decisions. At the Nigerian Investment Summit and Exhibition in New York, Jonathan offered a 10 year visa for foreign investors, with the aim to boost foreign direct investment (FDI). I am awaiting a full length paper on the benefits of this policy and I want to see the projections of how much FDI will result directly from this policy change. Comparing Nigeria’s FDI to Egypt’s another country in the N11 (based on 2009 IMF indicators Egypt had approx $1bn more FDI), why have we chosen to open borders when they have not? Can this policy directive pave the way for N11 countries to become the next set of emergent economies; this is definitely one policy to watch.
These 3 headings are helpful to get involved in the debate:
Neocolonialism simply describes the relations of power that influence economic and political outcomes. Reversing the political powers of sovereignty by allowing foreign investors into the country on the basis of investments, without having a bilateral agreement, means we have willingly relinquished equality in power play terms. We have potentially allowed political influence on the basis of economic favour. I applaud Tambuwal for suggesting a bilateral stance with the British government, our house speaker says the British government should reciprocate the gesture and offer Nigerian businessmen 10 year visas, and very well said to.
In my opinion this was very reactionary, it almost appears to be a direct response to insecurity. Nigeria is welcoming foreign investors at all costs because we seemingly are no longer safe. I criticise our president for referring to Boko Haram as ‘our friends’ as that trivialises the issue, and makes our pleas come across as desperate. The first way to resolve a problem is through transparency and educating investors about how security inefficiencies are being addressed is best, not referring to them as insignificant. It is a better approach to ensure strict policies of safety in your territory because that will encourage investors by default.
Can we attribute the increase in FDI between the years 2003-2007 as a direct impact of Ngozi Okonjo Iwela being the finance Minster and being on the Nigerian Economic Intelligence team? Can we also safely say that to stimulate the Nigerian economy at a time when there is no longer the effect of the cancellation of the Paris debt obligation, no more windfall oil gains, that to ensure she outperforms her last appointment she needs to come up with policies which ensure economic outperforming. Is there more of an onus on our Finance Minister to provide more results as this is her second time on the job?
Nigeria needs to maintain its position in the N11 and actually elevate to a top 20 economy by 2020 (love the rhetoric), and to make this happen, infrastructure is that watch word. FDI is the prescribed way to go, however FDI without strategic policy implementation… this will yet be another Pyrrhic victory, a simple case of ‘more money more problems’.
Similar to my last blog post my big question remains the same, who will police this policy to ensure that it is well executed? Who is defined as a foreign investor, who will assess what a viable financial investment is? Additionally not all investments will necessarily mature after 10 years, could be way less? What will be the additional revenue by extending such an offer, how will the synergy between the foreign and economic ministry be assessed/ reported.
This policy engineers so many more questions, we have to watch this space…