The launch of the Economic Recovery and Growth Plan (ERGP) attracted not only applause, but renewed optimism on the country’s possible return to growth path. While it was not the first of the many laudable and hopeful plans, the concerns were much about the implementation.
The cardinal objective of ERGP, which the Federal Government launched about 18 months ago, is to achieve economic recovery through activation and accelerated development of the non-oil sector, for the purpose of ushering a new era of sustainable economic growth and development.
The aim is to restore economic growth, invest in people and a globally competitive economy towards national prosperity, happiness and wellbeing of all Nigerians, irrespective of tribe, religion or political affiliation.
It also aims at creating a society where respect for rule of law and fundamental human rights would be paramount. These goals, indeed, are at different levels of achievement, with varying degrees of controversies.In March this year, a further step was taken in ensuring that the growth plan records as much success as intended, by organizing focus labs for investors in Abuja.
The event brought together more than 300 participants representing 180 companies and served as a driver for the ERGP, as well as key to unlocking investment potentials in the several sectors, which are expected to lead the envisaged economic recovery and growth.
This was modelled after a similar programme that enthroned economic fortunes in Malaysia. Of course, experts from that country were in attendance, alongside Nigerian counterparts.
One of the objectives of the focus labs was building of trust among key stakeholders in the economy. The event involved 67,200 man-hours in 22 syndication meetings, providing opportunity for key stakeholders in the public and private sectors to brainstorm.
The Minister of Budget and National Planning, Senator Udoma Udo Udoma, whose ministry coordinates the implementation of ERGP and the organiser of the focus labs, said the event was to catalyse private capital inflows to finance projects across the country.
“Our aim is, simply put, to raise the level of productivity in Nigeria”, he said. “We want more things to be grown in Nigeria. We want more things to be made in Nigeria. We want more opportunities created for Nigerians to be able to work.
That is what the focus labs are all about,” he said.
According to him, at the close of the focus labs, they succeeded in the objective of building trust and achieving a consensus among participants on what needs to be done to make the economic recovery programme achievable.
In a statement attributed to Vice President Yemi Osinbajo, he said: “Most of these investments will of course be from the private sector, therefore, the focus is to deal frontally with the issues facing the private sector businesses.”
Among objectives of the focus labs was the need to identify projects that were considered as Entry Point Projects (EPPs), with potential to make strong, catalytic impact on investment and job creation. Also, to develop practical and feasible plans, as well as strategies to implement them, with the assistance of individuals and experts responsible for the sectors involved. It also targeted at establishing and harnessing public-private partnerships
At the end of the event, there was a consensus among participants that ERGP is on course and would, if painstakingly implemented, take the country out of the decades-long economic doldrum.
There were some identifiable gains of the first focus labs, in practical terms- the success in identifying investment potential in some key sectors of the economy like agriculture, transportation, manufacturing, as well as power and gas, collectively estimated at about $22.5 billion, with potential to create about 500, 000 jobs by 2020.
“About $4.73 billion worth of investment has been identified in the agriculture and transport focus labs with a potential to create about 129, 000 jobs; $9.25 billion investment with potential of 378, 000 jobs was identified in the manufacturing and processing labs, while $8.57 billion worth of investment will come from power and gas, with potential of crating up to 7, 000 jobs”, Udoma said.
He said that the cumulative investment value of the projects that were identified at the focus labs were projected to rise up to about $39.12 billion, with potential for 716, 079 jobs by 2025.
A remarkable feature of the focus labs and a novelty in encouragement of private sector participation in the nation’s economic recovery process was the rating of projects in the manner hotels are rated- from zero-star to five-star.
A zero-star rating meant that a project needed to be worked on, even if it had potential, while increase in rating showed projects that were at different stages of progress or readiness. Udoma said a four or five-star project was good to go, and only needed finishing touches to enable it to take off.
This could be in form of financial backing or regulatory approval.
Investors with projects that were lowly rated had the opportunity of one-on-one meetings with experts, with more opportunities for follow-up meetings with bureaucrats in the relevant ministries, for the purpose of getting the projects fine-tuned in terms of design and packaging, to make them attractive to potential foreign partners. The aim is to ensure that every project attains a five-star status.
For instance, investors that had difficulty in assessing credit were taken through the different funding opportunities available through the Central Bank of Nigeria. Officials from the Federal Inland Revenue Service (FIRS) were on hand to explain to investors the various tax incentives the agency offers. This was important because of the difficulty the government faces in making payment of tax a culture among Nigerians, both individuals and corporates, which has been a major setback for revenue generation in the country.
Some of the immediate benefits participants derived from the focus labs include the fact that there were those who obtained approvals to facilitate the take off of their projects with ease – something that might not have been achieved over many months of trips to Abuja.
According to Udoma, Our Collective was able to obtain Letter of Intent (LOI) from the Ministry of Transportation to access funding to the tune of $500 million. Kabara Mining had its application for license renewal, finalised by the Ministry of Mines and Steel Development. Poliguard Investment, received LOI in favour of the export agency of the United Kingdom.
Also, Spring Fountain, an aviation company that is involved with Boeing Corporation of the United States in four projects that would not only lift Nigeria’s status in the international aviation industry, but also help in achieving the objectives of ERGP.