There are speculations that foreign investors are not willing to invest in Nigeria.
The reason you could say has a lot to do with the rising inflation in the Western world.
Foreign investors are, therefore, shying away from foreign direct investment.
President Bola Tinubu’s effort at reviving Nigeria’s economy is facing many troubles that are stunting its budding process.
One such challenge that the government had hoped would aid the revival process is foreign direct investment.
As a result, the Minister of Finance and Coordinating Minister of Economy, Wale Edun, revealed that foreign investors are shying away from investing in Nigeria.
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According to him, foreign investors are not interested in improving the nation’s foreign direct investment.
The reason is the rising inflation in Western countries and the need to keep interest rates high by tightening the money supply.
Edun said the lack of investor appetite to invest in Nigeria means the government may turn to the corporate world for solutions and investments.
He revealed this at the 40th annual Conference of the Chartered Institute of Directors on Thursday in Abuja.
Domestic Resource Mobilisation
The Minister said the development was forcing the government to depend on “our domestic resource mobilisation”.
The conference was themed, “Driving Nigeria’s Economic Transformation and Diversification: The Role of Corporate Governance”.
Edun said the essence of attracting investment into the economy was to increase productivity, grow the economy, create jobs, and reduce poverty.
The Minister said this is the overall aim of President Bola Ahmed Tinubu and his economic policies.
He said: “The government does not have the funding and the funding is not available internationally.
According to him, the Western world is trying to surmount the rising inflation challenge.
Therefore, it cannot provide any kind of development financing at the level we need.
“When we talk about investment and attracting investment into the economy, we are not only talking about domestic investors.
“But about foreign direct investments, private investment, and much more than what the multilateral organisations may have to offer.
“We must make our economy, institutions, and corporate governance attract FDI from around the world.
“So that those interested and who have surplus savings to invest would see it as a profitable venture.”
Low Foreign Exchange Revenue
Furthermore, Edun said Nigeria’s economy had been diversified, but expressed worry that foreign exchange revenue is yet to grow because oil had remained the major source of income.
He added that the present administration was ready to provide a stable economy.
“This means one that is growing more than the population growth, one where inflation is low, and the exchange rate is stable.
“And there is a reasonable interest rate for people to borrow and invest in productive activities.
“An important part of that is diversification, the economy is diversified as other sectors are increasingly contributing to the economy.
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“But what is not diversified is our source of foreign exchange revenue. So, from all those sectors whether telecommunications, transport or manufacturing.
There is not enough foreign exchange earnings or enough savings to give us what we need, which is the positive balance of trade.
“We need our export earnings to be greater than import expenditure so we can have foreign exchange earnings with which to stabilise the currency and so on,” the minister noted.
Strong Corporate Governance
According to him, strong corporate governance is needed in the country, as it increases investors’ confidence provides access to capital, promotes risk management, and drives innovation and efficiency.
He added that the CIoD has played a major role in enhancing the quality of world leadership and organisation while playing a key role in providing independent directors across all the boards in Nigeria.
On his part, the Former minister of finance, Dr Olusegun Aganga, in his keynote address, posited that Nigeria had the hallmark of a weak economy.
He said the bane of the economic growth is a lack of continuity and implementation of policies.
“The economy is the number one priority of any government, in some countries, elections are won or lost because of the economy.
Our economy today is relatively small, it is not growing fast enough and is not inclusive.
It has all the features of a weak economy; import dependent, weak and unstable macroeconomic environment, exports of primary products without value addition, among others,” he noted.
Also, he expressed the belief that strong corporate governance in Nigeria would strengthen institutions responsible for economic diversification and transformation.