Making Oyo Investors’ Destination

To make Oyo State a destination for sustainable investment in Nigeria, the state government has taken several steps to attract foreign investors and promote private sector-led business development. Gilbert Ekugbe writes on the opportunities the Oyo State International Business Summit 2023 offers to potential and existing local and foreign investors

On the 19th of May, 2023, the Governor, Oyo State, Seyi Makinde, was in London to organise the first edition of the Oyo State International Business Summit OYSIBS 2023. Themed, “Accessing the Pioneer Advantage to Sustainable Investments in Oyo State,” the summit was aimed at bringing together key stakeholders to showcase investment opportunities in the Oyo State economy and foster improved private sector-led business development and investment.

Undoubtedly, Oyo State has several investment opportunities in sectors such as agriculture, healthcare, education, tourism, and infrastructure development. For example, the State has vast arable land suitable for agriculture and a large population that provides a ready market for agricultural products.

Oyo State in Perspective 

Oyo State has a landmass of 28,454 square kilometres. To put that in perspective, it is about 18 times the size of London. With an estimated population of over 8 million where about 60 per cent are between the ages of 16 and 54, the State boasts of a large working population force.

Demographically, data shows that Oyo State is a ready investment market with a landmass and population giving it the comparative and competitive advantage that very few States in Nigeria have.

According to the state governor, in 2018, the World Bank published one of its last annual Ease of Doing Business Reports for subnational in Nigeria based on four key indicators to rate the State.

The state, he said, scored average to above average in three of these indicators which include starting a business at about 76 per cent, dealing with construction permits at about 61 per cent and enforcing contracts at about 53 per cent. 

“The score for registering property was quite low at just about 22 per cent. Oyo State scored 53.41 per cent in the Ease of Doing Business index overall. Looking at this data, it was clear that there was a lot of room for improvement in property registration. So, after we assumed office in 2019, we got to work. First, we built on the Certificate of Occupancy – C of O Made Easy Scheme, which our predecessors had tried to operationalise. Our goal was to ensure that properties could be registered in 60 days,” Makinde said.

He stated that so far, the State has achieved a measure of success in that regard leading to an expansion of the project. 

“It was renamed C of O Redefined, and commercial entities were pulled into the mix. This moved the emphasis to the business community. We also looked at the other indicators that would attract big businesses to Oyo State. We worked on our regulatory environment. For example, we made the Bureau of Public Procurement a standalone agency and appointed a Director General who used to be a private sector player. One of the remits of this agency is to create opportunities for SMEs,” he averred.

Addressing bureaucracies 

To address bottlenecks hindering the influx of local and foreign direct investments, the state created the Oyo State Public Private Partnership Agency (OYSIPA). The agency is the one-stop shop for investment opportunities in Oyo State in its bid to ensure that compliance regulations that businesses must adhere to are within the purview of the federal government. The agency is also working with the Presidential Enabling Business Environment Council (PEBEC) to implement the State Action on Business Enabling Reforms (SABER) Programme in the State. The PEBEC Secretariat and World Bank coordinate this project. So far, PEBEC has released two Ease of Doing Business Reports with the first published in 2021, and the second in 2023. The report, which was based on infrastructure, transparency and accessibility to information, secure and sustainable environment, regulatory environment, skills and labour and economic opportunity showed a 2-point improvement in perception by Micro, Small and Medium Enterprises (MSMEs) in land and property acquisition going from 2.88 to 4.88.

“As mentioned earlier, our administration shortened the process of obtaining Certificates of Occupancy to 60 days. We also made it easier to pay taxes through the adoption of technology. Today, you do not have to go to the agency to pay any bills in cash, you can do so online from anywhere in the world,” Makinde said.

Building human capacity

He added that in the past four years, the dtate has consistently maintained a 15-20 per cent budgetary allocation to its education sector.

The State, he added, has increased its funding to the all levels of the education sector, including the tertiary level, one of the three State-owned universities, the Ladoke Akintola University of Technology has been rated the best State-owned university in Nigeria for the past four years.

The move according to State is to bridge the dearth of skill gaps that exist in the nation’s skills and labour space as many middle-class people are leaving the country, the State is worried about the current trend and have taken steps to ensure that education and skills acquisition are prioritised.

“For example, in the last four years, we have also prioritised skills acquisition in the sectors where we have comparative advantage. For example, as part of our focus on agribusiness in the last four years, we have trained over 4,000 youths across the agribusiness value chain, and another 1,500 youths have passed through our Start Them Early Program (STEP), which trains young people aged 13-16 on various enterprises in the agribusiness value chain,” he added.

In his words: “With these and other improvements done, Oyo State has been able to create a conducive environment for the private sector to thrive. One of the factors that our surveys revealed has played a key role in the decision-making process of MSMEs is the growing middle class in Oyo State. MSMEs rated Oyo State 5.83 in New/Range of Customers. Of course, this is always an important factor. We do not only have a large working-class population, but they also have spending power. We have ensured that about 8 per  of our working population who are government workers have received their salaries regularly and consistently in the last four years; an injection of N12 billion into the economy monthly.”

“Through our efforts in the past four years, the State has been able to better its economic standing among Nigerian States and currently one of the top five economies in Nigeria. We now have a GDP of $8.67 billion in 2022. This is a growth of about 50 per cent in 4 years. The number of enterprises within the State grew to 1,872,941. We attracted Foreign Direct Investment (FDI) of $65 million,” he said.

“Against this background, I am sure you would like to know how you can join the thousands of investors in Oyo State and benefit from the huge Return on Investment that has led to about a dozen of these investors joining us at this summit to learn about how they can expand their business,” he urged.

Agribusiness

Oyo State has a comparative advantage in agribusiness and with a 2.85 million hectares of arable land and a climate and soil type suitable for most agribusiness enterprises, the State is focused on building agribusiness industrial hubs. 

‘We have already shown proof of concept with the Fasola Agribusiness Industrial Hub. Some of the investors in this audience today are already subscribed to the hub,” the Governor said.

The hub, he added, will have a built environment that supports various agribusiness ventures such as livestock, crop production centres, warehouses for agro-logistics and more.

“Let me also mention that we will start to work soon on Akufo, Eruwa and Ilora Farm Settlements to convert them to agribusiness industrial hubs. So, if you are an investor looking to develop one of our nine farm settlements in Oyo State, talk to us. We should be able to work out a Public Private and Development Partnership.

“This partnership involves building infrastructure that will make the area more business viable. For instance, to make the Fasola Agribusiness Industrial Hub accessible, we are reconstructing the 34.85 km Oyo-Iseyin Road,” he added.

“Going forward, the State is planning to inject $40 million into its livestock value chain through the World Bank-assisted Livestock Productivity & Resilience Support Project (L-PRES) as this would ensure that investors get the infrastructural support required in livestock production. For those who would like to see in specific terms what deals we have on agribusiness, please speak with Dr Debo Akande, my Executive Adviser on Agribusiness who is also the Director General of the Oyo State Agribusiness Development Agency,” he advised.

Solid minerals

Solid mineral development, Makinde added, is one of the three new entrants into the Oyo State investment portfolio. The State established the Pacesetter Mineral Development Company (PMDC). “The PMDC is the Special-Purpose Vehicle used to acquire solid minerals titles.  We have exploration and mining titles. After surveying the areas where we hold titles, we created a database of minerals on those titles. I can tell you that we have deposits of Feldspar, Talc, Marble, Pyraiba, Gold, Tourmaline, Quartz, Beryl and Granite. So, when you choose to partner with Oyo State, we will be able to tell you how much of a deposit of each of these minerals we have. That is one advantage of working with Oyo State in the solid minerals sector.

“The Oyo State now hosts the International Gemstone Market in Adan in Akinyele Local Government Area, Ibadan Zone. The collaboration between the Oyo State Government and the Federal Government shows how important the State is in the gemstone industry conversation.  So now is the time to locate ancillary facilities in the State. To learn more about investing in the Solid Minerals sector in Oyo State, please approach the Chairman of the PMDC, Abiodun Oni,” he stressed.

Sustainable energy

Makinde revealed that in 2019, the State created the Oyo State Ministry of Energy and Mineral Resources primarily to develop policies and programmes to help the State meet residents’ energy needs.

“While the power sector was still mainly under the Exclusive List of the Constitution of the Federal Republic of Nigeria 1999 (as amended) and so under the Federal Government’s control, Oyo State found a way of showing proof of concept for alternative energy sources to underserved communities.

So far, the Makinde-led administration has built five mini-grids in various communities.  At the same time, private investors have come on board to provide Energy-as-a-Service (EaaS) to 17 more communities. Additionally, the State has worked with Fan Milk Plc to provide 1 MW of solar power and Nigerian Breweries Ltd to provide 600 kW with a plan to upgrade this to 3 MW.

“We also have the 11 MW Independent Power Project (IPP) and the Oyo State-Shell Nigeria Gas construction of a Pressure Reduction and Metering Station (PRMS), which will deliver an upside of 60 million standard cubic feet of gas per day to industrial, manufacturing and commercial entities,” he affirmed. Following the devolution of powers in the sector, Oyo State has created the Oyo State Electricity Regulatory Commission, allowing partnership with the private sector on large-scale energy provision. To talk about more specific investments in this sector, we have our Commissioner for Energy and Mineral Resources, Barr. Temilolu ’Seun Ashamu,” he advised.

Tourism

Rich in culture and history, the State has barely tapped the available potential. After spending the first four years in office laying the groundwork to explore the State’s rich culture, it now has the market and the supporting purchasing power as evident in the State’s MSME experiencing massive growth business in the hospitality industry. 

From its records, Oyo State has about 5,342 MSMEs in the hospitality sector up from 3,918. 

“This is mainly because of the improved business outlook in the State. Oyo State receives over 10,000 visitors into the state daily. Some come to stay, others are passing by, and others stay for a while. As you make this decision, bear in mind that we will be providing you with access to our database of all tourism sites in Oyo State and their unique features. You can also work with us in organising trade shows and other events that will be built around state-adopted cultural days. If you are excited about investing in Oyo State Tourism in more specific ways, our Commissioner for Information, Culture and Tourism, Dr Wasiu Olatubosun, is your man, “Makinde said.

Infrastructure

He stated that despite meeting a huge deficit when his administration assumed office, the state made infrastructure development as one of its core focus areas.

“To bridge its huge infrastructure decay, the present administration started with the bigger projects such as the 65 km Moniya-Ijaiye-Iseyin Road, the 34.85 km Oyo-Iseyin Road, the 76.67 km Ogbomoso-Fapote-Iseyin Road and the 48 km Ido-Eruwa Road. We are also working on completing the 110 km Senator Rashidi Ladoja Circular Road, which encircles the Ilutuntun Business District in Akinyele Local Government Area, I mentioned earlier that the International Gemstone Market Centre is at Akinyele Local Government Area. We plan to turn this zone into “the most futuristic growth corridor of the city of Ibadan.

“So, within this radius, we also have the proposed Ibadan Inland Dry Port and the Railway Corridor. The State is also working on a circular road that would be rolled as it has completed the heavy lifting to construct the first 32km East-Wing and completing six bridges including two interchanges along the route. Why not talk to our Commissioner for Public Works and Transportation, Prof Dahud Shangodoyin, about investing in Oyo State Infrastructure,” he implored.