Nigeria has been ranked the nineteenth most attractive economy for investments flowing into the African continent, according to the latest Africa Investment Index 2016 by Quantum Global’s independent research arm, Quantum Global Research Lab. In 2015, Nigeria attracted a net foreign direct investment of US$3.1 billion.
According to the report, the top five African investment destinations attracted an overall FDI of US $13.6 billion. Botswana was ranked the most attractive economy for investments flowing into the African continent followed by Morocco, Egypt, South Africa and Zambia.
While commenting on the report findings, Head of Quantum Global Research Lab, Prof Mthuli Ncube stated that despite the current economic challenges, the firm remained confident on the medium to long term market prospects. Ncube noted that Nigeria had earmarked significant amount of capital to develop critical infrastructure in the country and there are various opportunities for public private collaboration providing investors’ return on their investments.
“We anticipate that investment in infrastructure will underpin the growth of the economy and meet the needs of a large Nigerian growth population,” he added.
Following the decline in oil prices, which impacted various African oil producing nations, the Nigerian government has intensified its effort towards diversifying the local economy and has laid out a roadmap to enhance public infrastructure and support high growth sectors in the country such as manufacturing, ICT, agriculture amongst others to meet the local demand along with boosting exports globally in the short to medium term to stabilise the macro-economy.
Nigeria is the biggest economy in Africa with a GDP of $415 billion that is projected to grow to about US$595 billion by 2020. This presents a big market for goods and services. In this sector, Gross Domestic Product (GDP) per capita currently at 2,260 had been projected to leap to US$2,907 by 2020, which could boost consumption and domestic demand.
Commenting further, Ncube added: “The short to medium term focus of the Nigerian Government is to reduce imports and address primary sector blockages, such as roads, bridges, power, railway, aviation, water, housing, agriculture, education and health. Despite the current market volatility, Nigeria presents tremendous investment opportunities in these areas, which would not only support the local economy but also deliver significant yields to foreign investors.”
Nigeria has implemented various reforms to boost and restructure the economy including the introduction of the Nigeria Industrial Revolution Plan (NIRP), establishing the Enabling Business Environment Council (PEBEC) to make Nigeria more attractive for investments, and the microcredit scheme in the 2016 budget, which will see the Bank of Industry, overseeing the disbursement of loans to 1.6 million traders, artists, farmers and young entrepreneurs over the next twelve months.