The Federal Government of Nigeria, through its Executive Council, on Wednesday, approved N169.7bn private sector investments for at least four road infrastructures under the government’s Tax Credit Scheme.
Minister of Works and Housing, Babatunde Fashola, made this known to the State House correspondents after the council meeting. At the meeting presided over by President Muhammadu Buhari, Fashola disclosed that the scheme was initiated in 2019 through Executive Order 7 signed by the President, and that the arrangement allowed private sector players to finance public infrastructure instead of paying taxes and then offset it over time using tax credits.
In the statement made available to Investors King, the four roads include a 234 kilometre stretch from Bali to Sheti through Gashaka to Gembu in Taraba State at the sum of N95,232,474,010.72 and the second road, which is also a tax credit scheme, is made up of three roads worth N74,486,577,050.
For the 234-kilometre road in Taraba costing N95.23bn, Fashola noted that N20bn under the NNPC Tax Credit Scheme would be disbursed to begin the project soonest.
“The two main memoranda relate to the uptake by the private sector in response to the tax credit programme, which we initiated in 2019, by Mr. President signing of Executive Order 7 to allow private sector finance public infrastructure in lieu of tax and then to offset it over time using tax credits.
“So the first road that was awarded today on that policy initiative is the rule road from Bali to Sheti through Gashaka to Gembu in Taraba State. A total of 234 kilometres reconstruction of that road in the sum of N95,232,474,010.62.
“The existing road, for those who are familiar with it, has no concrete stone base. It is just laterite on the asphalt so it doesn’t last and it’s breaking up and leading to potholes.
“So we’ve rewarded this now for reconstruction under the tax credit scheme, there’s a N20bn provision under the NNPC tax credit scheme that will be used to kickstart this immediately,” he said.
Fashola added that “the second road which is also the tax credit scheme, which was approved by the Council is actually three roads. The applicant, in this case, is Mainstream Energy Solutions, a major energy player in the country and is now seeking to also participate in this policy by investing a total of N74,486,577, 050.”
British International Investment to Invest $1B in Nigerian Banks, Telecoms, and Other Key Sectors in the Economy
The British International Investment (BII), the UK Government’s Development Finance Institution (DFI), is investing $1 billion in Nigerian banks, infrastructure and power in the next five years.
The BII’s investment strategy was announced yesterday by the Chief Executive Officer, British International Investment, Nick O’Donohoe, at a briefing in Lagos.
He said the BII has invested $100 million in FirstBank; $75 million in Stanbic IBTC; $15 million in CardinalStone Capital Advisors and a $162.5 million syndicated loan package in Access Bank.
Azura Power also got $30 million in debt finance to support the construction of the 461 mega wats Azura-Edo power plant.
He said investments reflect BII’s focus on mobilising capital to build self-sufficiency and market resilience in Nigeria and improve access to inclusive economic opportunities while helping to catalyse Nigeria’s boundless entrepreneurial ambition.
O’Donohoe said: “Investing in the prosperity of Nigeria’s growing population requires innovative new partnerships that can leverage the country’s abundant capabilities and expertise.’’
He said investments in key segments of the economy are evaluated based on sustainability, inclusion and productivity.
“I am delighted that not only will BII’s investment help to create jobs and provide entrepreneurial self-starters with the means to own their vehicles,” he said.
British High Commissioner, Catriona Laing CB, said: “It’s a pleasure to be in Lagos to mark the launch of British International Investment. BII forms an important part of UK’s package of tools and expertise to help Nigeria build their pipeline for investment and scale up infrastructure investment, in particular, to achieve clean, green growth.”
Investment Opportunities on the Rise as Nigeria Steps up Efforts to Strengthen Health Sector
A new focus report, produced by Oxford Business Group (OBG), highlights the opportunities for investors to contribute to the development of Nigeria’s health sector by bridging funding shortfalls for planned infrastructure projects and supporting other segments with high growth potential.
Titled “Nigeria Health”, the report provides in-depth analysis of both the health sector and pharmaceutical industry in an easy-to-navigate and accessible format that includes key data and infographics. It also includes an interview with Mojisola Adeyeye, Director General, National Agency for Food and Drug Administration and Control, and contains in-depth case studies and viewpoints from key industry players, such as Fidson, Codix, GSK, Merck and Bayer.
The report explores the key role that public-private partnerships (PPPs) are expected to play in bringing a range of health care projects to fruition and helping Nigeria to achieve its ambitious goals for the sector, which include increasing the number of hospital beds to nearer the global average bed-to-population ratio of 2.7 per 1000 people.
It also considers the potential Nigeria has to boost local production capacity for consumable items, such as syringes, bandages and dressings, needles and catheters, and, in turn, reduce its import bill.
The opportunities emerging in medical technology are another focus. In this section, OBG provides in-depth coverage of the digital solutions disrupting health provision worldwide, which include extending care to underserved areas and facilitating remote diagnosis and treatments.
The report shines a spotlight on Nigeria’s pharmaceutical industry, tracking the growth stories of key companies with a presence in the country and featuring contributions from high-profile industry representatives.
With Nigeria’s reliance on China and India for pharmaceuticals evident at the start of the Covid-19 pandemic, OBG considers the scope for increasing local production capacity. It also notes the part that Nigeria’s Five Plus Five-Year Validity policy is expected to play in increasing partnerships between multinational pharmaceutical firms and local manufacturers.
In addition, the report examines the topical issue of counterfeit drugs, looking in detail at Nigeria’s efforts to address this and related challenges through monitoring and enforcement solutions.
Karine Loehman, OBG’s Managing Director for Africa, said that while Nigeria’s health sector continues to feel the knock-on effects of the Covid-19 pandemic and other, pre-existing challenges, the government had made notable progress in meeting key health indicators in recent years, while a successful PPP model bodes well for investors eyeing opportunities in infrastructure and other segments showing potential.
“Nigeria’s expanding population and underlying fundamentals make it an attractive proposition for the international investment community,” Loehman said. “With the pandemic having created new opportunities for expansion and innovation, and public funds limited, our report points to a health sector ripe for development, offering opportunities that range from capital projects to the provision of high-quality medical services at new and existing facilities.”
The report on Nigeria’s health sector forms part of a series of tailored studies that OBG is currently producing, which includes ESG Intelligence and Future Readiness reports, and other highly relevant, go-to research tools, such as country-specific Growth and Recovery Outlook articles and interviews.
Lagos Remains Top Destination for Investment Despite Drop in Capital Importation
Despite an overall 28.09 percent decrease in Capital Investment in Nigeria, Lagos State remains the number one destination for investments in Nigeria in the first quarter (Q1), 2022.
In the quarter under review, capital investment into Lagos state stood at $1,119.44m, representing 71.16 percent of total capital investment into the country in Q1 2022.
According to the report obtained by Investors King from the National Bureau of Statistics (NBS), the total value of capital importation into Nigeria in Q1 2022 stood at $1,573.14m from $2,187.63m in the preceding quarter, showing a decrease of 28.09 percent.
On a yearly basis, the capital importation decreased by 17.46 percent from $1,905.89m.
The report showed that the most significant amount of capital importation by type was received through Portfolio Investment, which accounted for 60.87 percent ($957.58m).
This was followed by Other Investment with 29.28 percent (US$460.59m), and Foreign Direct Investment (FDI) accounted for 9.85 percent ($154.97m) of total capital imported in Q1 2022.
Breaking down the number into sectors, capital importation into banking was the highest at $818.84 million in the first quarter, amounting to 52.05 percent of total capital imported.
Capital imported into the production sector came second at US$223.67 million (14.22 percent). The finance sector followed with $199.37m (12.67 percent).
Capital importation by country of origin shows that the United Kingdom ranked top as the source of capital imported into Nigeria in Q1 of 2022 with a value of $1.021.21m, accounting for 64.92 percent.
This was followed by the Republic of South Africa and the United States of America, valued at $117.50m (7.47 percent) and $82.07m (5.22 percent), respectively.
In terms of Destination of Investment, the Federal Capital Territory, Abuja, comes second after Lagos with a value of $446.81m, representing 28.40 percent.
Standard Chartered Bank of Nigeria imported the most fund at $543.20m (34.53 percent) while Citi Bank Nigeria Limited with $439.03m (27.91 percent) and Stanbic IBTC Bank Plc came third with $251.52 (15.99 percent).
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