Investment Policy Review - Nigeria

image of Investment Policy Review - Nigeria

Nigeria is well known as a major oil producer. However, oil wealth has not been converted unto a comparable improvement in living standards, due to decades of economic mismanagement. The report provides an overview of foreign direct investment (FDI) trends and performance; analyses the investment framework; outlines a strategy of “supported market forces” to induce and support foreign affiliates in manufacturing to increase their presence in the country and in so doing the contribution to Nigeria’s development. The final chapter summarizes the main findings of the report and the proposed policy recommendations.



Working towards an effective FDI strategy: Conclusions and recommendations

In recent years, Nigeria has attracted increasing levels of FDI, essentially concentrated in the oil sector. Beyond this sector, FDI has, however, remainded low and not played a significant role in industrial development. As articulated in its home-grown strategy, the Government of Nigeria is promoting a private sector-led approach to achieving its national development objectives. In this regard, NEEDS emphasizes the central role of broad-based investment and focuses on the need to attract FDI in a variety of economic activities. Based on the philosophy presented in NEEDS, the role of the Government is therefore evolving towards one of regulation and facilitation of investment rather than direct involvement in business. This was reiterated by the current Administration. Against this background, the authorities have removed virtually all restrictions to FDI entry and are currently extending the scope of FDI by inviting private investment into areas such as public infrastructure and utilities. As economic fundamentals further strengthen and new measures are put in place to improve the investment environment, greater volumes of FDI will undoubtedly enter Nigeria.


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