Siaka Momoh
The Federal Ministry of Industry Trade and Investment (FMITI) is the heart of the Nigerian economy, Olusegun Aganga, the minister who runs the ministry, said Friday in Abuja, as he reviewed the activities of the ministry in the last three years.
Aganga, who spoke at the 2014 Media Chat/Strategic Retreat organised by his ministry said “investments affect all sectors of the economy”.
He explained: “Manufacturing and trade account for 27% of GDP, Industry 25.9% and MSME 46%. In the past, there was no plan in place to achieve a diversified economy. Manufacturing GDP was low; there was much pressure on foreign exchange. We had a weak industrial infrastructure. All we were doing was importation of raw materials – there was no value addition. But the story is different today.”
The minister said Nigeria would have been in big trouble now if it had remained oil revenue-skewed – if it had spurned diversification, explaining that “today, oil is US$83 per barrel – America that was our number one partner for trade is now number 12; it now exports oil and does not need our oil – India is now our number one trade partner”.
Said Aganga: “No country has ever moved from a poor status to a rich status without a strong industrial revolution. This is the reason why Nigeria came up with the Nigerian Industrial Revolution Plan (NIRP), an infrastructural master plan that is linked to all development plans in the country.”
Nigeria, according to Aganga, has attracted US$59bn pipeline local and foreign direct investments within three years, while the country’s economic base diversified significantly in the same period. He said this feat was possible because the far-reaching industrial policies initiated by the ministry, in line with the Transformation Agenda of President Goodluck Jonathan, had made the country a destination of choice for investment.
Said he: “If you look at pipeline investments that have come into the country within the last three years, we have a minimum of US$59billion coming into the different sectors of the economy over the next five to eight years. This does not include the investments that are coming into the power sector. If you look at the value chain, we have about US$60billion in investments going into the power sector.”
He said of the US$59 billion $12bn would into the integrated petrochemical plant. “This means that if that petrochemical plant comes on stream as planned by 2018, there will be no need for the country to import refined petroleum products, and that will be a big boost towards the economic diversification of the country.”
He reeled out investments that are going into fertilizer and ethanol plants and agribusiness – sugar refinery, rice mills and cement and automobile manufacturing.
On automobile manufacturing, he said, “It is now more than just assembling cars like we did in the past. By May 2014, the automotive policy was approved by the Federal Executive Council; October 2013 saw Nissan launching its first Nigerian cars. In the list of automobile companies already producing are Peugeot Automobile, Ashock, Leyland, Innoson Vehicle Manufacturing, etc.
According to him, “In 2011, we did not have a comprehensive automotive policy on the ground. Today, in the automotive sector, over 22 companies have signed technical commitments to manufacturing or assembling cars in Nigeria.”
He added that to date, Nigeria has recorded 40% increase in automobile manufacturing capacity while investment in sugar cane has risen from $100m in 2011 to N3.2 billion today.
The cement sector has witnessed installed capacity increasing from 16.5 million metric tonnes per annum in 2011 to 39.5 million metric tonnes currently, the minister said.
The price of cement recently went down at the instance of Dangote Cement, the nation’s number one cement manufacturer. It brought down the price of its 32.5 from N1,700 per bag to N1,000. The 42.5 is coming down from around N1,800 to about N1,150 per bag”.
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