Private and Confidential

INVESTING IN NIGERIA’S NEW ECONOMY

2018 ANNUAL BUSINESS LUNCHEON OF CAPITAL MARKET SOLICITORS

ASSOCIATION

YEWANDE SADIKU

EXECUTIVE SECRETARY/CEO

NIGERIAN INVESTMENT PROMOTION COMMISSION

LAGOS | 25 APRIL 2018

1

Investor feedback (no particular order)

“poor private sector engagement in policy formulation”

“painful, long, unpredictable government approval process”

“corruption: can’t get anything done without paying a bribe”

“difficult operating conditions: no power, no roads, no public utilities”

“lack of skilled labour”

“government policy flip flop, changing rules without notice”

“harassment of existing investors”

“corrupt judiciary; too many sacred cows”

“meeting with senior government officials cancelled after investor’s arrival”

“tariff measures never work, borders too porous”

“difficulty with getting access to FX”

“announced tariffs not enforced”

“easier to import than to invest”

“road to the ports”

“difficulty with getting visas”

“insufficient investment incentives”

“poor work ethic”

“access to capital”

“high cost of doing business”

2

What do investors look for?

Business Environment

Attractiveness

Workforce Infrastructure

Real Estate

Natural Disasters

Knowledge and Innovation Living Environment

Business Costs

Incentives

Taxation

Regulatory Framework

Source: IBM Global Business Services: Plant Location International

Bu

sin

ess

Envi

ron

men

t

Macro Stability/Risk Market force

Workforce Costs

Workforce/Skills Infrastructure

Costs

Real Estate Incentives

Quality of life Micro

3

Business case for improving business operating conditions

Strong correlation between economic prosperity and ease of doing business

R² = 0.4918

100

1,000

10,000

100,000

020406080100120140160180200

Income per capita (log scale) USD per person per year

# of Objs = 185

Nigeria

Brazil

South Africa

USA

Singapore

Norway

Ease of Doing Business Rank (2017)

Source: World Bank

4

“While we are not unaware of the challenges currently being faced by our businesses, on our part, the Government remains relentless in our goal of removing the obstacles and roadblocks that have long afflicted commercial activity in Nigeria.”

H.E VP Prof. Osinbanjo SAN, March 2016

in the World Bank Ease of Doing Business Index.

Move Nigeria

STEPS UPWARDS

REMOVE CRITICAL BOTTLENECKS

& BUREAUCRATIC CONSTRAINTS

to doing business in Nigeria

Email: info@ebes.gov.ng | Website: www.pebec.gov.ng | Twitter: @EBESnigeria | Facebook: www.facebook.com/EBESnigeria

Vice President Yemi Osinbajo SAN, GCON

President Muhammadu Buhari, GCFR

▪ Chaired by HE VP; Vice

Chair HM Ministry of

Industry, Trade and

Investment

▪ 10 Honourable Ministers,

Head of Service and CBN

Governor

▪ Meets frequently to

provide steer, ensure

coordination across

ministries and resolve

challenges

Key partnerships and

technical supporters

▪ Development agencies,

e.g. World Bank,

Government of Singapore

▪ Advisors: consulting firms,

technology companies

▪ Private sector companies/

stakeholders

▪ Routinely interfaces with

MDAs, State Governments,

as well as multilateral

agencies

The Mandate

5

Registering Property

▪ Sworn affidavit not needed for title search at land registry (Lagos)

▪ Digitization of land records and cadastral mapping of Kano City.

Paying Taxes

▪ E-filing of Federal Taxes.

▪ Centralized electronic payment of all Federal Taxes.

Dealing with Construction Permits

▪ Publicized fees, procedures and laws.

▪ Operationalized the Lagos e-planning platform.

Trading Across Borders

▪ Reduction of documents for export from 10 to 7 and similarly for import from 14 to 8.

Starting a Business

▪ Online name reservation

▪ Consolidation of incorporation forms into one form (CAC.1) which can be completed electronically.

Getting Credit

▪ Borrowers have the right by law to access their credit reports .

▪ The operationalization of a modern, web-enabled National Collateral Registry

Getting Electricity

▪ Reduction of procedures for new grid connections.

Entry & Exit of People

▪ Harmonization of four forms on arrival into one form by the Nigerian Immigration Service.

▪ 48 hour visa processing timeline across missions abroad.

Reforms over the past 18 months

Email: info@ebes.gov.ng | Website: www.pebec.gov.ng | Twitter: @EBESnigeria | Facebook: www.facebook.com/EBESnigeria

6

Starting a Business

Dealing with Construction Permits

Getting Electricity

Registering Property

Getting Credit

Paying Taxes

Enforcing Contracts

Protecting Minority Investors

Trading Across Boarders

Resolving Insolvency

130/ 190

147/ 190

172/ 190

179/ 190

6/ 190

33/ 190

171/ 190

183/ 190

96/ 190

145/ 190

+8

+27

+8

+3

+38

-1

+11

-2

+43

-5

2018

2017

2016

2015

2014

145/ 190

169/ 190

170/ 189

170/ 189

147/ 189

+24

+1

+0

-23

-16

Rank Difference

DB 2018 Ranking

Rank Difference

DB Year

Nigeria has achieved its highest jump in DB rankings… …with progress across several indicators

Email: info@ebes.gov.ng | Website: www.pebec.gov.ng | Twitter: @EBESnigeria | Facebook: www.facebook.com/EBESnigeria

7

Economic Recovery and Growth Plan (ERGP)

2017 - 2020

Restoring Growth

• Macroeconomic stability

• Economic diversification

Investing in Our People

• Social Inclusion

• Improved human capital

• Job creation and youth empowerment

Building a Globally Competitive Economy

• Investing in infrastructure

• Improving the business environment

• Promoting digital-led growth

Broad Policy Objectives

• Double manufacturing’s share of GDP

• Maintain a competitive exchange rate

• Reduce inflation from 18.6% to 9.9%

• Increase tax/GDP ratio from 6% to 15%

• Improve budget preparation and execution process

• FDI target of $10bn

• Create 15m new jobs

• Grow GDP at average of 4.62%

• Top 100 ease of doing business ranking by 2020

• Rebalance domestic/foreign debt from 84:16 to 60:40

Source: ERGP document

8

ERGP Focus Labs

Identify projects to drive growth, increase private investments and create new jobs

Mobilize private capital to finance projects

Harness private-public partnerships

Achieve economic diversification, inclusive and sustained growth

Enhance productivity for quality made in Nigeria products

Focus labs Objectives

Agriculture Manufacturing Power Supply

Solid Minerals Transportation Gas

Pre-Labs

8 weeks

Labs

6 weeks

Post-Labs

3 weeks

January 15 - May 12

9

Done: Compendium of Investment Incentives in Nigeria

Compilation of fiscal incentives in Nigerian tax laws and duly approved sector-specific incentives

6 principal sections

– Investment policies and protections

– General tax-based incentives

– Sector-specific incentives

– Tariff-based incentives

– Export incentives

– Special Economic Zones

First step in understanding impact of incentives in achieving Government’s economic objectives and considering incentive reforms

10

Done: Pioneer Status Incentive - clearer application process

for new applications

11

Done: Nigerian Investment Certification Program for States

The State’s ability to provide complete, accurate and relevant information to investors in a timely manner.

Information Standard

The State’s ability to offer sites and buildings that meet targeted investors needs in a transparent and efficient manner.

Property Standard

The State’s ability to promote and sell the region in a focused manner and to offer professional levels of service to potential and existing investors.

Marketing Standard

Highly qualified to help investors

State Certification following training and assessment on 3 standards

Well qualified to help foreign and

domestic investors

Qualified to help foreign and

domestic investors

Not yet ready to help investors

Serious weaknesses that need to be addressed

12

Done: Initial Assessment of Nigeria’s Bilateral Investment Treaties

Source: NIPC Analysis

3 14%

1 5%

17 81%

21

Validation required to complete assessment

13

WIP: Investment Promotion Club, a public private partnership

Investment Promotion

Club

Strategy consulting Corporate

finance advisory

Legal advisory

Tax advisory

Banking services Accounting Executive search

Strategic marketing

Real estate advisory

Risk analytics

NIPC, working with professional service providers, for investment promotion and facilitation

14

WIP: Country-focused investment promotion strategy

Investment sources (Global, Africa & Nigeria)

Countries that have trade relations (import and export) with Nigeria

Countries with capacity to support Nigeria with world class investments in the priority sectors

Countries that have strategically decided to make outward investments

Countries with which Nigeria has a strategic relationship, such as having signed a Bilateral Investment Agreement

Objective Criteria

1

2

3

4

5

Broad-based

investment promotion

Identify strategic investment promotion countries based on a

defined criteria

To proactively determine countries with which to

develop strategic investment promotion relationships

1

2

3

4

5

15

WIP: Direct Investors’ Summit, Nigeria 2018

Why Attend • Get direct access to policy makers

• Receive relevant data on investment trends and opportunities

• Meet with investors and promoters of investment projects

across Nigeria

Host and Speakers

His Excellency, Muhammadu Buhari, GCFR President, Federal Republic of Nigeria

His Excellency, Yemi Osinbajo, GCON Vice President, Federal Republic of Nigeria

Honourable Minister Okechukwu Enelamah Minister of Industry, Trade and Investments

Yewande Sadiku Executive Secretary, Nigerian Investment Promotion Commission

Yemi Kale Statistician General, National Bureau of Statistics

To register, visit: www.disn.com.ng

16

Yewande Sadiku Executive Secretary/CEO

infodesk@nipc.gov.ng osicinfodesk@nipc.gov.ng

NIGERIAN INVESTMENT PROMOTION COMMISSION Plot 1181 Aguiyi Ironsi Street

Maitama District Abuja

www.nipc.gov.ng

For further details, please contact us