FG signs agreements with Afreximbank, BoI, NSIA to develop special economic zones

The
federal government on Friday signed investment agreements with
three development finance institutions — Afreximbank, Bank of
Industry and the Nigeria Sovereign Investment Authority (NSIA) —
for the creation of special economic zones in the
country.

With the
signing, President Muhammadu Buhari, who presided over the ceremony
at the Council Chambers of the Aso Rock Villa, declared the
investment company in the special economic zones will become
operational.

“Today, we are here to witness the signing of investment
agreements, following which the Nigeria SEZ Investment Company
Limited will become fully operational,” he said.

The federal government set up NSEZCO Limited as
a vehicle for participating in public-private partnerships
involving Federal and State governments and local and foreign
private investors to develop new special economic zones all over
the country, offering world class infrastructure and facilities at
competitive costs.  The projects in the pilot phase
include Enyimba Economic City, Funtua Cotton Cluster and Lekki
Model Industrial Park.

The three
DFIs are among the five to partner with NSEZCO and the Ministry of
Finance Incorporated. NSEZCO intends to raise at least $500million
in equity over the first five years in order to execute its
ambitious strategy of becoming a leading investor in special
economic zones in the country. The other investment partners are
African Development Bank (AfDB) and Africa Finance Corporation
(AFC).

Called
Project MINE (Made in Nigeria for Exports) the development of
special economic zones under the direct supervision of the
President Muhammudu Buhari, is a Presidential special priority
intervention aimed using the zones to attract substantial
foreign and domestic investment for the development of world-class
facilities dedicated to export-oriented manufacturing in a range of
industries across Nigeria.

Project MINE
seeks to position Nigeria as the pre-eminent manufacturing hub in
sub-Saharan Africa and as a major exporter of made in Nigeria goods
and services regionally and globally; as well as boosting
manufacturing’s share of Gross Domestic Product to 20 per cent;
generating $30bn in annual export earnings; and creating 1.5
million new jobs all by 2025.

Speaking at
the signing ceremony, Buhari said the federal government set up the
Nigeria SEZ Investment Company Limited as a vehicle for
participating in Public Private Partnerships involving Federal and
State governments and local and foreign private investors to
develop new special economic zones all over the country. He said,
the projects in the pilot phase include Enyimba Economic City,
Funtua Cotton Cluster and Lekki Model Industrial Park.

The president
said the federal government is implementing a comprehensive plan
including “the invitation of experienced Special Economic Zone
developers and operators to partner with us to upgrade the Federal
Government owned Free Trade Zones in Calabar and Kano, to offer
world class standards of infrastructure and
facilities.  Whilst we await the completion of the
process of bringing in these investors, the Federal Executive
Council has approved the award of contracts in excess of N19.45
billion for the needed investment in Calabar and Kano Free Trade
Zones and work is currently ongoing.  This is the highest
amount of capital investment ever in the history of these
zones”.

He added: “We
have allocated substantial funds to upgrade the capabilities of our
people and the systems in the Nigeria Export Processing Zones
Authority to strengthen it as a regulator of our Special Economic
Zones; and we are allocating substantial resources to the provision
of “outside the fence” infrastructure to ensure that our Special
Economic Zones are connected to global, regional and domestic
markets.

“We are
reviewing our incentive framework to ensure competitiveness
relative to the other countries with whom we are in the race to
attract export oriented global manufacturing investment.”

He added that
the federal government will extend the early successes achieved in
ease of doing business to the areas critical to globally
competitive export-oriented manufacturing operations.

He thanked
the investment partners for their “strong demonstrations of support
for the important initiative”.

Okechukwu
Enelamah, whose ministry, industry, trade and investment is
implementing Project MINE, recalled Buhari’s choice for special
economic zones to hasten industrial development and the mandate to
the ministry to attract investors to participate in the
project.

“This is the
reason we are here today. The investors have all agreed to partner
with us,” he said.

He said the
initial projects, such as the Enyimba Economic City, are underway,
while feasibility study is going on in eight states.

The signing
of the agreement was done by  Benedict Oramah, president of
Afreximbank, Kayode Pitan, managing director of the Bank of
Industry and Uche Orji, managing director of NSIA.

Femi Edun, a
director of NSEZCO and Bakari Wadinga, director, Ministry of
Finance Incorporated, signed on behalf of the company.

Project MINE seeks to achieve the following specific
objectives:

• Aid structural transformation of the Nigerian economy by
  increasing the manufacturing sector’s contribution to GDP to 20% by
  2025;
• Contribute to sustainable inclusive growth by creating 1.5
  million new direct manufacturing jobs in the initial phase of
  Project MINE;
• Increase and diversify foreign exchange earnings to at
  least US$30bn annually by 2025, by increasing manufacturing sector
  exports;
• Create local models of global best practice in provision of
  world class infrastructure at competitive costs connecting SEZs to
  international and regional markets with transport links,
  uninterrupted power, ICT, water, sewage and other services to
  ensure smooth and efficient operation of SEZ
  businesses;
• Promote the “cluster” effect to be gained by locating
  similar export-oriented manufacturing businesses within the same
  locality;
• Attract world class investors with strong positions in
  global supply chains and investors with potential to increase the
  scale of operations rapidly to set up operations in SEZs;
  and
• Create an enabling environment for SEZ businesses by
  instituting best in class legal and regulatory frameworks, using
  technology and streamlined processes to facilitate movement of
  people, goods and capital and easy access to government services,
  approvals and permits.