Nigeria is the 19th most attractive economy for investments flowing into the African continent, a new report has indicated.
The Africa Investment Index 2016 report showed that Nigeria attracted a net Foreign Direct Investment of $3.1bn in 2015.
According to the index, African investment destinations attracted an overall FDI of US $13.6bn.
Botswana was ranked the most attractive economy for investments flowing into the African continent followed by Morocco, Egypt, South Africa and Zambia.
The report was released by Quantum Global’s independent research arm, Quantum Global Research Lab.
Commenting on the report, the Head, Quantum Global Research Lab, Prof. Mthuli Ncube, said, “Despite the current economic challenges, we are quite confident on the medium to long-term market prospects. Nigeria has earmarked a significant amount of capital to develop critical infrastructure in the country and there are various opportunities for public private collaboration providing investors’ returns 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.”
Following the decline in oil prices, which impacted various African oil producing nations, the Federal Government has intensified its effort towards diversifying the economy and has laid out a road map to enhance public infrastructure and support high-growth sectors in the country such as manufacturing, ICT, agriculture, among others.
This is aimed at meeting local demand along with boosting exports globally in the short-to medium term to stabilise the macro-economy.
Nigeria, the biggest economy in Africa with a gross domestic product of $415bn, is projected to grow to about $595bn by 2020.
According to the index, this presents a big market for goods and services. In this sector, the GDP per capita currently at 2,260 is projected to leap to $2, 907 by 2020, which could boost consumption and domestic demand.
Remarking on Nigeria’s economy, Ncube further said, “The short to medium-term focus of the Federal 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.”
The Federal Government has implemented various reforms to boost and restructure the economy including the introduction of the Nigeria Industrial Revolution Plan, establishing the Enabling Business Environment Council 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 12 months.