Experts Identify Impediments to Private Sector Investment in Nigeria

Minister of Information, Culture and Tourism, Alhaji Lai Muhammed and other experts, who spoke at the Aviation Round Table (ART) forum over the weekend, identified inadequate education and lack of commitment in issues involving in PublicPrivate Partnership (PPP), as the major obstacles to private sector investment in Nigeria.

Other speakers at the forum, which held in Lagos, included Chairman, The Resort Group, Dr. Wale Babalakin (SAN) and the CEO of Air Peace, Allen Onyema.

Specifically, the experts, some of who are investors in the aviation industry agreed that the major hindrances to private investment in the sector and other sectors of Nigeria’s economy include the lack of legal framework, inconsistent government policies and failure to honour business agreements.

According to them, until these problems are resolved, there would always be dearth of the expected direct investments, both locally and internationally, which are needed to exit the country’s economy out of the current recession.

Delivering a lecture as the Guest Speaker on “Investment Opportunities in Airport Development for Economic Growth”, at the Quarter Three edition of Aviation Round Table forum, Babalakin lamented that the attitude of government officials had continued to scare away private investors.

He said a situation where various past governments, especially the military with their civilian collaborators, destroyed all sectors of the economy with inconsistent policies was what Nigerians were paying for today, adding, “weak educational system with melancholic decadence of great intellect is affecting the aviation sector and all other sectors of the economy”.

He expressed regret that 11 ministers had presided over the affairs of the aviation sector with different policies, since he started investing in the sector over one decade ago. He said those policies, “if subjected to critical analysis lead to nothing”.

To him, a government, which does not honour its own agreement cannot be taken seriously by investors, even as he advised that at the negotiation stage with an investor, the government must put his best intellectuals forward to do the negotiation “instead of making the investor, who has the agreement, look like the devil because Public-Private Partnership (PPP) projects require 75 per cent of thinking and 25 per cent in implementation”.

On his part, Muhammed, who was the Guest of Honour, agreed with Babalakin that there was the need for a legal framework in PPP policy, pointing that that government officials also needed to change their approach to agreements validly entered into with any private investor, irrespective of his or her ethnic background or religion, in order to attract the required private investments for the economy.

While describing MMA2 as a proof of what the private investors can do, the minister said: “If MMA2 is an error, it is a good error and I want that kind of error replicated all over Nigeria.”

Speaking in the same vein, Onyema lamented the hostile operational environment for domestic airlines, pointing out that domestic carriers pay about 37 taxes. He said that despite the waiver given to airline operators from the federal government which allows them to import aircraft and spares without paying duties, the Nigeria Customs still device other ways to make them pay some charges.

He urged government to push for the legislation on the waiver so that it will become part of the law and would therefore not be at the whims of the executive that has four-year tenure.