The Minister of Finance and Coordinating Minister of Economy, Wale Edun, has said foreign investors are not really interested in improving the nation’s foreign direct investment due to rising inflation in Western countries and the need to keep interest rates high by tightening the money supply.
He said the lack of investor appetite to invest in Nigeria means the government may turn to the corporate world for solutions and investments.
Speaking at the 40th annual Conference of the Chartered Institute of Directors on Thursday in Abuja, the Minister said the development is 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 is to increase productivity, grow the economy, create jobs, and reduce poverty, noting that 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. They are not interested and they have inflation to fight in the Western world so they have to keep interest high, tighten the money supply, and cannot not 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. The big prize is to make our economy, institutions, and corporate governance such that it attracts, from around the world, those interested and have surplus savings to invest in for profitable ventures.”
The minister asserting that Nigeria’s economy has been diversified, expressed worry that foreign exchange revenue is yet to grow because oil has remained the major source of income.
He, however, noted that the present administration is ready to provide a stable economy, “this means one that is growing more than the population growth, one where inflation is low, the exchange rate is stable, and 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.
“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.
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 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 has 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.
He added that strong corporate governance in Nigeria would strengthen institutions that are responsible for economic diversification and transformation.
Also speaking, the President and Chairman of Governing Council of CIoD, Tijanni Borodo, said the conference was aimed to serve as a platform, where people converge to share insights, knowledge, and strategies aimed at driving Nigeria’s economic transformation, and diversification through the lens of corporate governance.
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