Buhari: Nigeria is Africa’s Most Viable Investment Destination

* Investors commit N412bn to 35 Nigerian startups in 10 months

Festus Akanbi in Lagos and Deji Elumoye in Abuja

President Muhammadu Buhari has declared that Nigeria remains the most viable and attractive investment destination in Africa.

Buhari also said Nigeria is on the path of becoming Africa’s leading industrial and trading nation.

This is coming as some foreign and local investors have invested a total of N412billion ($992million) across 35 Nigerian startups in the first 10 months of 2021.

The president, who stated these in Dubai, United Arab Emirates (UAE) while addressing a trade and investment forum at Dubai Expo 2020, said Nigeria is reaping from the efforts his administration has made to consciously improve the investment environment.

According to him, “Nigeria’s pavilion at the Expo 2020 clearly shows why we remain the most viable and attractive investment destination in Africa. Our location, our natural resources, our population, and our regulations are there for all to see.

Nigeria is on its way to become a leading industrial and trading nation in Africa. To achieve this, our government focused on policies, projects and programs that support private sector investors.

“We introduced numerous fiscal incentives and infrastructure projects aimed at enhancing the viability of investments.
“Despite the adverse global economic environment of recent years, Nigeria’s investment environment has greatly improved both at the national and sub-national levels,’’ he said.

President Buhari assured captains of industry, and entrepreneurs, who have shown interest and commitment to further enhance trade and investment relations with Nigeria, that his administration would continue to work with them to improve the business climate especially as the African Continental Free Trade Area (AfCFTA) comes into full effect.

“Just last month at the Intra Africa Trade fair in Durban, I reminded business leaders that most of Africa’s challenges, whether security, economic or corruption, can be traced to our inability to domesticate the production of our most basic requirements and provide jobs to our teeming and dynamic youth population.
“I am pleased that this Forum focuses on ‘Unveiling Trade and Investment Opportunities in Nigeria,’ and will encourage you all to keep an open mind and look beyond the challenges.

‘‘In this room, we have governors, ministers and heads of government agencies that can address all your questions and concerns.
‘‘We are here to support you and I hope you will all take this opportunity to move your investment decisions forward,’’ he said.

The Nigerian leader also used the occasion to express profound gratitude to his hosts, Sheikh Khalifa bin Zayed bin Sultan Al Nahyan, the President of the United Arab Emirates and the Emir of Abu Dhabi, for their unwavering commitment to strengthen trade and investment relations between both countries through various initiatives, partnerships and support.

Investors Commit N412bn to 35 Nigerian Startups in 10months

Meanwhile, some foreign and local investors have invested a combined sum of N412billion ($992million) across 35 Nigerian startups in the first 10 months of 2021.
Similarly, Google has pledged to invest $1billion in Africa over the next five years aimed at promoting digital transformation and innovation across the continent.

The Financial Derivatives Company Limited (FDC), which disclosed this in its monthly economic report for December, described the rising interest in Nigerian startups as a good omen for the Nigerian economy.
Startup traditionally refers to a company still in its early stages of operations.

The report noted that on its part, the federal government has developed the Nigerian Startup Bill, which is on its way to the Senate for approval, adding that if passed, the bill will empower the Nigerian tech ecosystem by fostering cooperation between stakeholders in the startup space and Nigerian regulators to ensure that subsequent laws and regulations are in line with the best interests of the sector.

According to the report, the development is an indication that Nigeria, in recent years, has witnessed the advent of a new type of company, one more forward-looking and technologically savvy than those of the past.
“These companies typically leverage technology to disrupt already established industries and offer a new standard of value to consumers,” the report said.

It explained that these companies, apart from obviously creating employment opportunities, bring huge swaths of foreign capital and investments into the country. A number of them also help to solve burning societal and economic issues that impede the living standards of many Nigerians.

FDC believed that “The copious amount of startup firms with decent value propositions, and the availability of a large market with active demand for their service offerings, coupled with the large in the flux of foreign capital, all illustrate the fact that we are at the genesis of the golden age of startups in Nigeria.”
According to the report, the global boom in startup popularity is not exclusive to Nigeria or the West, Africa currently has about 577 registered startup companies.

Nigeria is said to have accounted for the second-highest number of these at 144, just behind South Africa which has 154 startups.
By far the most popular startups in Africa are the tech startups, consisting of fintech, e-commerce, e-health, ed-tech, and agri-tech among others.

In 2020, African tech startups raised a combined sum of $701.41million; $625.66million (89.2 per cent) of that went to the ‘big four’ African technology investment destinations – Nigeria, South Africa, Kenya, and Egypt.

The FDC said that the number of Nigerian startups that secured investments in 2020 represented a 77 per cent increase from the number recorded in 2019, which was 48.
It added that the Nigerian startup funding has risen every year since 2016, with 2020 representing a 22.8 per cent increase from funding secured in 2019.

This trend is projected to continue as estimated funding secured in the third quarter of 2021 alone ($248million) surpassed the totality of funding secured in 2020 by 64.89 per cent.
“In 2020, certain Nigerian startups distinguished themselves from the pack by raising prodigious amounts compared to the rest of the startup industry. For example, Flutterwave, a fintech company, raised $35million in its series B funding round. Flutterwave would later go on to raise $170million in its series C round in 2021, which would elevate the company to Unicorn status. Fintech company Bitfxt and e-health firm, 54gene secured $15million each in 2020,” the report said.