Why Invest in Nigeria

Abundant Resources: Nigeria has enormous resources, most of which are yet to be fully exploited. They include mineral, agricultural and human resources.


Large Market: Nigeria offers the market in sub-Saharan Africa, with a population of about 120 million people. The Nigerian market potential also stretches into the growing West African sub-region.

Political Stability: Nigeria offers stable political environment.

Free Market Economy: The Government has created a favorable climate for business and industrial ventures. Administrative and bureaucratic procedures have been greatly streamlined. The Government has put in place policies and programmes that guarantee a free market economy.

Robust Private Sector: The country has a dynamic private sector, which has assured greater responsibilities under the new economic environment.

Free Flow of Investment: Exchange control regulations have been liberalized to ensure free flow of international finance. There is now unrestricted movement of investment capital.

Attractive Incentives: A comprehensive package of incentives has been put in place to attract investment.

Fast Growing Financial Sector: There is well-developed banking and financial sector. The investor has easy access to working capital and other credit facilities.

Skilled and Low Cost Labour: There is an abundance of skilled labour at an economic cost, resulting in production costs, which are among the lowest in Africa.

Infrastructure: Rapid development of physical and industrial infrastructure, in terms of transportation, communications, electricity and water supply.

Nigeria is Africa’s foremost business destination second only to SA. Its currency is the Naira. N1.00 is approximately N127USD. The country operates a market economy dominated by crude oil exports with the revenue earnings from the sector accounting for 90% of forex earnings and 65% of budgetary revenues. Other exports are cocoa, palm oil, groundnuts, cotton, timber and rubber.

Nigeria’s imports are in the region of $14.54billion USD. Import commodities include machinery, chemicals, transport, equipment, manufactured goods and live animals.

In recent times, focus is being directed at non oil exports and agriculture, which presently accounts for 30% of the GDP, to diversify the economic base. Opportunities exist for the exploitation and export of natural gas, bitumen, limestone, coal, tin, columbite, gold, silver, lead-zinc, gypsum, glass sands, clays, asbestos, graphite, and iron ore, among others.

The Government has been pursuing economic reforms marked by the privatization and deregulation which seek to transfer state ownership of institutions to the private sector and so engender efficiency n the productive sectors of the economy .These are well articulated in The NEEDS programme. The reforms have led to an explosive growth in the telecoms sector after years of stagnation. The GSM has transformed the economic terrain creating employment and oiling the operations of businesses in Nigeria. The country is traversed by a network of primary and secondary roads, and has 4 international airports, and 6 seaports. It also boasts 12 Television stations and 25 National newspapers. Its internet country code is .ng

Nigeria, officially the Federal Republic of Nigeria, is a country in West Africa and the most populous country on the African continent. Nigeria shares land borders with the Republic of Benin in the west, Chad and Cameroon in the east, Niger in the north, and borders the Gulf of Guinea in the south. Since 1991, its capital has been the centrally located city of Abuja; previously, the Nigerian government was headquartered in Lagos.

The people of Nigeria have an extensive history, and based on archaeological evidence, human habitation of the area dates back to at least 9000 BC. The Benue Cross River area is thought to be the original homeland of the Bantu migrants who spread across most of central and southern Africa in waves between the 1st millennium BC and the 2nd millennium AD. However, the Nigerian state came into being on October 1, 1960 when Nigeria declared its independence from the British and at present consists of 36 states and the federal capital territory. Nigeria re-achieved democracy in 1999 after a sixteen year interruption by a series of military rulers. From 1966 until 1999, Nigeria had been ruled (except the short lived second republic, 1979 1983) by military rulers who seized power in coup d'états and counter coups. Today Nigeria is a democratic country with tremendous market and investment opportunities.

Geography: Nigeria Lies within three climatic and geographic types equatorial in the southern reaches, tropical in the central area and arid in the north fringe giving rise to rainforest, savannah and desert vegetations respectively. Nigeria is bisected by rivers Niger and Benue which merge at Lokoja, then cascade southwards to form the tributaries and creeks of the Niger Delta.

Nigeria Trade Investment

The agricultural potential of Nigeria is barely being tapped and this explains the inability of the country to meet the ever increasing demand for agricultural produce. Although the agricultural sector remains a dominant employer of labour, serious investment is needed across the board to enhance production and increase the contribution of the sector to GDP. Investment is required in the following priority activities:

(a) Crop production to achieve food security and to provide industrial raw materials. Potentials exist for the following crops:

Cereals: Maize, rice, sorghum, corn, millet, wheat.

Root crops: Cassava, yam, ginger, potato, coco yam.

Legumes: Soya beans, groundnuts, cowpeas.

Fruits: Mango, banana, oranges, guava, papaw, pineapple.

Vegetables: Cabbage, green pepper, carrots, lettuce, spice, onions, melons.

Tree crops: Oil palm, cocoa, rubber, coconut, kola nut, coffee, she nuts, beniseed, cotton, cashew nut, sugar cane.

Others:
Commercial growing of flowers and ornamentals and experimental orchards for more temperate fruits-apples, grape vines and pears have been successfully established in the high plateau regions.

(b) Food processing and preservation involving industries that will use agricultural produce as raw materials.

(c) Livestock and Fisheries production which possess great potentials for development. Grazing lands are abundant, facilities for animal feed production are plentiful, and the in-land rivers, lakes and coastal creeks are sufficient to augment ocean fishery resources.

(d) Agricultural inputs supplies and machinery, water resources development especially for flood control infrastructure and irrigation.

(e) Commodity trading and transportation.

(f) Development and fabrication of appropriate small-scale mechanized technologies for on-farm processing and secondary processing of agricultural produce.

(g) Exploitation of timber and wood processing activities. A wide range of wood resources abound.

AVERAGE ANNUAL (1990-1998) OUTPUT OF MAJOR AGRICULTURAL COMMODITIES IN NIGERIA, CROP PRODUCTION (‘000 TONES)

A. Cereals Maize 5954 Millet 5134 Millet 3048 Wheat 205 Sorghum 7096	B. Grain legumes or Pulses Cowpea 1644 Soybean 248
C. Root Tubers Yams 21100 Cassava 214 Coco yam 1589 Irish potato 85 Sweet potato 812	D. In Industrial Crops Cotton 287 Groundnut 1716 Cocoa 288 Coffee 346 Sugar Cane 755 Palm kernel 742 She nut 265 Rubber 170 Ginger 49 Benniseed 58 Palm Oil 784 Coconut 141

These are widely used in food and beverage sub-sectors like flour mills, breweries, chemical, pharmaceuticals, pulp and paper, wood products and industrial starch

OPPORTUNITIES IN THE SOLID MINERALS SECTOR

Nigeria is endowed with numerous mineral resources. Recent policy reforms have brought the solid minerals sector to the fore. The emphasis is on encouraging massive foreign investors’ participation in this sector.

PROFILE OF SOLID MINERALS DEPOSITS IN NIGERIA

TALC

An estimated reserve of over 100 million tones of talc has been obtained in Niger, Osun, Kogi, Kwara, Ogun, Taraba and Kaduna States. There are only two medium size talc processing plants currently operating in Nigeria and both are located in Niger State. The color of the Nigerian talc varies from white through milky-white to gray. The talc industry represents one of the most versatile sectors of the industrial minerals of the world. The exploitation of the vast talc deposits in Nigeria would therefore satisfy not only local demands but also that of the international markets as well.

IRON ORE

There are over 3 billion tones of iron ore found in kogi, Enugu, Niger, Zamfara and Kaduna States. Iron is currently being mined at Itakpe (Kogi State), which is more or less at the center of the region of crystalline iron deposits. The large deposit of oolitic iron ores of Kogi and Enugu States are yet to be fully explored. Itakpe iron ore is being beneficiated to 67% Fe. To feed Aladja and Ajaokuta Steel complexes. Besides there are three in-land rolling mills at Oshogbo, Jos and Katsina in addition to some privately owned rolling mills in Lagos and Kano.

GOLD

There are proven reserves of both alluvial and primary deposits of gold with proven reserves in the shiest belt covering the western half of Nigeria. At present exploitation of alluvial deposits is being carried out mostly by artisan miners in a few places in the country. A number of primary deposits, which are sufficiently big for large scale mechanized mining, have been identified in the northwest and southwest parts of the county. Private investors are invited to stake concessions on these primary deposits. It is interesting to note that the primary deposits are of relatively high grade and at shallow depth. Production costs will easily be as low as about $50 per ounce.

BITUMEN

The occurrence of Bitumen deposits in Nigeria is indicated at about 42 billion tones almost as twice the amount of existing reserves of crude petroleum. When fully developed, the industry will no doubt meet local requirements for road construction and also become a foreign exchange earner for the country.

ROCK SALT

The national demand for table salt, caustic soda, chlorine, sodium bicarbonate, sodium hypochloric acid and hydrogen peroxide exceeds one million tones. A colossal amount of money is expended annually to import these chemicals by various companies including tanneries, food beverages, paper and pulp, bottling and other industries including the oil companies. There are salt springs at Awe (Plateau State), Abakaliki (Enugu State) and Uburu (Imo State), while rock salt is available in Benue State. A total reserve of 1.5 billion tones has been indicated, and further investigations are now being carried out by government to ascertain the quantum of reserves.

GYPSUM

Gypsum is an important imput for the production of cement. It is used for the production of Plaster of Paris (P.O.P) and classroom chalk, etc. A strategy for large-scale mining of gypsum used in the cement industries is urgently required to sustain existing plants and meet future expansion. Current cement production is put at 8 million tones per annum while the national requirement is 9.6 million tones. About one billion tones of gypsum deposits are spread over many states in Nigeria.

LEAD/ZINC

An estimated 10 million tons of lead/zinc veins are spread over eight States in Nigeria. Joint venture partners are encouraged to develop and exploit the various lead/zinc deposits all over the country.

BENTONITE AND BARYTE

These are the main constituents of the mud used in the drilling of all types of oil wells. The Nigerian baryte had specific gravity of about 4.3. Over 7.5 million tons of baryte have been identified in Taraba and Bauchi States. Large bentonite reserves of 700 million tonnes are available in many states of the Federation ready for massive development and exploitation.

COAL

Nigerian Coal is one the most bituminous in the world owing to its low sulpur and ash content and therefore the most enviroment friendly. There are nearly 3.00 billion tonnes of indicated reserves in 17 identified coalfields and over 600 million tonnes of proven reserves.

GEMSTONES

Gemstone mining has boomed in various parts of Plateau, Kaduna and Bauchi States for years. Some of these gemstones include Sapphire, Ruby, Aguamarine, Emerald, Tourmaline, Topaz, Garnet, Amethyst, Zircon and Flourspar which are among the world’s best. Good prospects exists in this area for viable investments.

KAOLIN

An estimated reserve of 3 billion tonnes of good kaolinitic clays has been identified.

TANTALITE

Large deposits of Tantalite are known to occur in Nasarawa, Gombe and Kogi tates as well as the Federal Capital Territory. The deposits ar both alluvial and primary in the numerous pegmatite bodies that infest these ares. Grades of well over 50% Ta2O5 are found. Private investors are invited to stake concessions for the development and exploitation of tantalite in these areas.

Pelletisation of Coal for Domestic Use

Given the large deposits of brown coal in the tertiary sediments east and west of River Niger; Nigeria can cash in on foreign investors’ technology to produce coal pellets for industrial use, coal briquettes for domestic use; that is, to replace firewood.

Incentives and Strategies for Investment

Investment Incentives:

- 3-5 years Tax Holiday.

- Deferred royalty payments.

- Posible capitalisation of expenditure on exploration and surveys.

- Extension of infrastructure such as roads and electricity to mining sites, and provision of 100% foreign ownership of mining concerns.

OPPORTUNITIES IN THE SOLID MINERALS SECTOR

Nigeria is endowed with numerous mineral resources. Recent policy reforms have brought the solid minerals sector to the fore. The emphasis is on encouraging massive foreign investors’ participation in this sector.

PROFILE OF SOLID MINERALS DEPOSITS IN NIGERIA

TALC

An estimated reserve of over 100 million tones of talc has been obtained in Niger, Osun, Kogi, Kwara, Ogun, Taraba and Kaduna States. There are only two medium size talc processing plants currently operating in Nigeria and both are located in Niger State. The color of the Nigerian talc varies from white through milky-white to gray. The talc industry represents one of the most versatile sectors of the industrial minerals of the world. The exploitation of the vast talc deposits in Nigeria would therefore satisfy not only local demands but also that of the international markets as well.

IRON ORE

There are over 3 billion tones of iron ore found in kogi, Enugu, Niger, Zamfara and Kaduna States. Iron is currently being mined at Itakpe (Kogi State), which is more or less at the center of the region of crystalline iron deposits. The large deposit of oolitic iron ores of Kogi and Enugu States are yet to be fully explored. Itakpe iron ore is being beneficiated to 67% Fe. To feed Aladja and Ajaokuta Steel complexes. Besides there are three in-land rolling mills at Oshogbo, Jos and Katsina in addition to some privately owned rolling mills in Lagos and Kano.

GOLD

There are proven reserves of both alluvial and primary deposits of gold with proven reserves in the shiest belt covering the western half of Nigeria. At present exploitation of alluvial deposits is being carried out mostly by artisan miners in a few places in the country. A number of primary deposits, which are sufficiently big for large scale mechanized mining, have been identified in the northwest and southwest parts of the county. Private investors are invited to stake concessions on these primary deposits. It is interesting to note that the primary deposits are of relatively high grade and at shallow depth. Production costs will easily be as low as about $50 per ounce.

BITUMEN

The occurrence of Bitumen deposits in Nigeria is indicated at about 42 billion tones almost as twice the amount of existing reserves of crude petroleum. When fully developed, the industry will no doubt meet local requirements for road construction and also become a foreign exchange earner for the country.

ROCK SALT

The national demand for table salt, caustic soda, chlorine, sodium bicarbonate, sodium hypochloric acid and hydrogen peroxide exceeds one million tones. A colossal amount of money is expended annually to import these chemicals by various companies including tanneries, food beverages, paper and pulp, bottling and other industries including the oil companies. There are salt springs at Awe (Plateau State), Abakaliki (Enugu State) and Uburu (Imo State), while rock salt is available in Benue State. A total reserve of 1.5 billion tones has been indicated, and further investigations are now being carried out by government to ascertain the quantum of reserves.

GYPSUM

Gypsum is an important imput for the production of cement. It is used for the production of Plaster of Paris (P.O.P) and classroom chalk, etc. A strategy for large-scale mining of gypsum used in the cement industries is urgently required to sustain existing plants and meet future expansion. Current cement production is put at 8 million tones per annum while the national requirement is 9.6 million tones. About one billion tones of gypsum deposits are spread over many states in Nigeria.

LEAD/ZINC

An estimated 10 million tons of lead/zinc veins are spread over eight States in Nigeria. Joint venture partners are encouraged to develop and exploit the various lead/zinc deposits all over the country.

BENTONITE AND BARYTE

These are the main constituents of the mud used in the drilling of all types of oil wells. The Nigerian baryte had specific gravity of about 4.3. Over 7.5 million tons of baryte have been identified in Taraba and Bauchi States. Large bentonite reserves of 700 million tonnes are available in many states of the Federation ready for massive development and exploitation.

COAL

Nigerian Coal is one the most bituminous in the world owing to its low sulpur and ash content and therefore the most enviroment friendly. There are nearly 3.00 billion tonnes of indicated reserves in 17 identified coalfields and over 600 million tonnes of proven reserves.

GEMSTONES

Gemstone mining has boomed in various parts of Plateau, Kaduna and Bauchi States for years. Some of these gemstones include Sapphire, Ruby, Aguamarine, Emerald, Tourmaline, Topaz, Garnet, Amethyst, Zircon and Flourspar which are among the world’s best. Good prospects exists in this area for viable investments.

KAOLIN

An estimated reserve of 3 billion tonnes of good kaolinitic clays has been identified.

TANTALITE

Large deposits of Tantalite are known to occur in Nasarawa, Gombe and Kogi tates as well as the Federal Capital Territory. The deposits ar both alluvial and primary in the numerous pegmatite bodies that infest these ares. Grades of well over 50% Ta2O5 are found. Private investors are invited to stake concessions for the development and exploitation of tantalite in these areas.

Pelletisation of Coal for Domestic Use

Given the large deposits of brown coal in the tertiary sediments east and west of River Niger; Nigeria can cash in on foreign investors’ technology to produce coal pellets for industrial use, coal briquettes for domestic use; that is, to replace firewood.

Incentives and Strategies for Investment

Investment Incentives:

- 3-5 years Tax Holiday.

- Deferred royalty payments.

- Posible capitalisation of expenditure on exploration and surveys.

- Extension of infrastructure such as roads and electricity to mining sites, and provision of 100% foreign ownership of mining concerns.

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