Why Investors Are Afraid Of Doing Business In Nigeria
The latest report on capital importation (foreign investment) by the National Bureau of Statistics, NBS has shown that foreign investments inflow into Nigeria has been on a steady decline.
A host of factors have been blamed for this, including the inability of the government to create an enabling environment for foreign investors.
In addition to that, a director of African Studies at John Hopkins University, Peter Lewis has identified “Political business cycles” as another factor making foreign investors to stay away from Nigeria.
He lamented policies and economic programmes discontinued after the end of a President’s tenure and not taken up by the succeeding President.
Mr. Lewis made this submission at the 24th Nigerian Economic Summit in Abuja on Tuesday.
He said: “On the negative side, Nigeria because of history is considered a high risk of environment. One of the most interesting conversation we have had in the last several months was at the African Investment day where there were a couple of country people in the room talking about their biggest concerns about risks.”
I was in clusters of private equity investors recently and they worry about the next election, and about who becomes the next President. I worry about that, Lewis said.
“There’s a political business cycle. We can think back to 2000 where there was IMF in the Obasanjo Government and that was put on hold and suspended because of 2003 elections because they realize everything is going off the rails. We would just put this on hold and then resume the conversation at May 29.”
He rather advised that whatever the outcome of the election, the next administration should not discard running policies but “roll out an early plan or an early team that would take charge of international audience.”
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