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Monday, August 11, 2014

$14bn Obama initiative: US, Nigeria begin collaboration on infrastructure financing



Nigeria and the United States have commenced plans to leverage on US President Barack Obama’s $14bn investment pledge in Africa, for an effective financing structure for infrastructure in Nigeria.
US President Barack Obama (R) shakes hands with President Goodluck Jonathan of Nigeria before their bilateral meeting in New York on September 23, 2013 on the sideline of the United Nations General Assembly. AFP US President Barack Obama (R) shakes hands with President Goodluck Jonathan of Nigeria before their bilateral meeting in New York on September 23, 2013 on the sideline of the United Nations General Assembly. AFP
The Minister of Industry, Trade and Investment, Olusegun Aganga, and the US Commerce Secretary, Penny Pritzker, agreed during a bilateral meeting at the just-concluded US-Africa Summit that increased investment in the area of infrastructure would further improve the Nigerian business environment, noting that Obama’s focus on power was particularly encouraging.
While the two countries agreed to work on the financial structure for infrastructure within the next few weeks, Pritzer noted that US companies were eager to do business in Nigeria due to the ongoing reforms in critical sectors, adding that they could also leverage on the US export assistance facilities scattered around the country.
Aganga, who spoke to journalists in Washington DC, during the summit, said, apart from the investment commitments and and memoranda of understanding, MOU, that were signed during the summit, most investors agreed that Nigeria had the most robust, clear and friendly policies on power, which other African countries should try to emulate.
He said: “This means we already have an enabling environment that will encourage more investors to come and invest in the sector. In fact, what these investors were saying was that most of our sectoral policies, which we have put in place already have encouraged them to come and invest in Nigeria.
“That was why, when we met with the American automotive manufacturing giant, Ford, during the summit, they said that they wanted to come to Nigeria as quickly as possible because of our new automotive policy.
“If the new auto policy was not in place, Ford would not be talking about coming to invest in Nigeria.
That is the value you get as a country when you have a proper industrial plan and well-articulated sectoral policy in place.”
The minister added: “Also, the World Bank made a pledge of $5 billion for risk capital, preparation of projects and to invest in Nigeria overall. Most of these investments will be going to the power sector. This is coming into Nigeria because the country is ready to receive investors.
“On our next plans, we are looking forward to the re-formulation and re-modernisation of the African Growth and Opportunity Act, AGOA. We are working on a National AGOA strategy in addition to raising the awareness of Nigerians to fully understand the benefits and opportunities that exist therein for them.
Also, we will continue to engage with the United States under the Trade and Investment Framework Agreement, TIFA, in order to build and sustain the present momentum.”

Aganga said that the United States was keen on boosting trade with Africa and Nigeria in particular, noting that the interests cut across all sectors of the Nigerian economy.
“If you look at the people that participated in the summit, they cut across the different strata of the economy. The United States, especially President Obama, is focusing on power. So, overall, I see the major sectors of the Nigerian economy benefiting from Obama’s initiative.
“In the real sector, for example, we expect more investments coming into the agro-industrial sectors, textile and garment, palm oil, sugar and food processing generally,” he said.
On the Economic Partnership Agreement, EPA, the minister insisted that Nigeria had not shifted its position, saying EPA must meet the country’s expectations and must be “in our overall best economic interest as a nation.”

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