Former Deputy Governor of the Central Bank of Nigeria, Kingsley Moghalu, has opined that Ease of Doing Business rankings are not enough to attract foreign investors to Nigeria. According to him, Nigeria’s weak economic enabling policy space also deters investors.
Impacts of poor policies: He stated that in his career so far, poor economic policy is a major roadblock for investors willing to invest in Nigeria. “In my business as a ‘knowledge entrepreneur’ providing advisory services to foreign investors interested in Nigeria and other African countries, I find that many investors are interested in Nigeria’s potential value but are held back by weak economic policy and business environment,” he said.
Moghalu added that the year 2023 could also be an economic boom for Nigeria if the right policies are implemented.
Enabling Policy: He noted that Ease of Doing Business mainly covers the substance of the policy, adding that without an enabling policy environment, investors will stay away.
- “Ease of doing business is mainly about the substance of policy + the transparency and efficiency of the marketplace. Tax issues and port administration also matter greatly.
- “We can do all the Ease of Doing Business work we want, but without a substantively enabling policy space, as well as zero/low corruption, most potential investors will stay out, and some inside already may leave.
Moghalu urged that 2023 could open the vista for an economic boom in Nigeria depending on how things evolve. “Nigeria holds much attraction to investors. It’s a great market” he said.
What you should know: It was reported last year that Nigeria attracted a sum of $1.54 billion as capital inflows in the second quarter of 2022, an increase of 75.34% compared to $875.62 million recorded in the corresponding period of 2021.
The breakdown of the report showed that the largest amount was received through portfolio investment at $757.32 million, which accounted for 49.33% of the total inflows, followed by other investments with $630.87 million, representing 41.09%, while foreign direct investment accounted for 9.58% ($147.16 million).
