Unveiling Ogun State’s Economic Promise
Femi Ogbonnikan, who covered the recent Ogun State Economic Forum, writes on the two-day event, showcasing the economic potentials of the South-west heartland
Ogun State is a major industrial hub of Nigeria and the West African sub-region. To showcase the state’s economic potentials, the Governor Ibikunle Amosun administration initiated a forum for investors from across the world, the fourth edition of which was held on Tuesday and Wednesday in Abeokuta, the state capital. Amosun, who is doing his second term, has since the inception of his government in 2011 pursued an economic development agenda predicated on three key areas, namely, industry, agriculture, and technology. He has aimed to turn the state, which ranked 35th out of the 36 states of the federation on the World Bank ease of doing business rating in 2011, from a public sector driven economy to a private sector focused one. The state government says the mission has been largely fulfilled.
Turnaround
At the Ogun State Investors’ Forum 2018 press conference held on March 13, 2018 in Abeokuta, the Commissioner for Commerce and Industry, Otunba Bimbo Ashiru, disclosed that from a paltry N730 million monthly Internally Generated Revenue in 2011, the state currently boasted N7 billion. Ashiru said between 2014 and 2015, Ogun State recorded 54.5 per cent growth in direct investment.
The Amosun administration says it is targeting a monthly IGR of N10 billion before the expiration of the governor’s second tenure on May 29, 2019. It reveals that over 300 new industries have been established in the state between 2011 and 2018.
Open for Business
The Ogun State Investors’ Forum 2018, the fourth edition of the forum, was tagged, “open for business”, and themed, “Consolidation the gains, accelerating growth.” It was held on March 20 and 21 at the June 12 Cultural Centre, Abeokuta.
In his address at the event, Amosun stated that the state government’s approach to agriculture was both holistic and futuristic. He stated, “This administration streamlined the process of land allocation and offered incentives to serious prospective investors. In order to complement available agricultural land belonging to the government, the state government continuously collaborates with host communities, to make more agricultural land available for large-scale commercial farming.
“We also remain committed to infrastructural investment as a catalyst for economic growth and transformation. As a result of our concerted efforts, Ogun State becomes a reference point among the comity of states in Nigeria. “Our improved business environment remains a solid foundation for our new status as the industrial capital of Nigeria. This is not just a claim, but one that is corroborated by the Manufacturers Association of Nigeria (MAN). Data collated by MAN revealed that between 2014 and 2016, Ogun State attracted 75 per cent of the total foreign direct and local investment into the manufacturing sector. This was the period between the second and third editions of our investors’ forum.” The governor said Ogun State, as rated by MAN in terms of the value of investment, had N515 billion (i.e., 26.9 per cent) of total manufacturing investment in Nigeria in 2016 and, as certified by the Nigeria Investment Promotion Council (NIPC), a five-star rating as an “investment friendly state” on Nigeria Investment Certification Programme for States (NICPS). According to Amosun, “We have taken strides to harmonise taxes and levies within the state. The road haulage laws, policies and regulations have been harmonised and relevant levies and taxes rolled into a single payment. This will ease movement of goods and services across the highways in the state. In addition, our land use and amenities charge has also harmonised related levies, such as tenement rates and amenities charged, into a single payment.”
He also talked about the “Youth entrepreneurship training at the Technology Incubation Centre (TIC), Onijanganjangan, facilitated by the Foreign Trade and Investment Services Africa (FTAISA) in partnership with our administration and, establishment of an Export Promotion Council smart office in the Ministry of Commerce and Industry to coordinate and facilitate exportation of local commodities.”
Based on the recent efforts, Ogun State was ranked the second most viable state in the country in terms of fiscal sustainability in the 2017 BudgIT report.
Infrastructure
The governor said, “On infrastructure, we have undertaken the following projects, amongst oth- ers, a total of 357.11km of Ogun Standard Roads constructed; maintenance/rehabilitation of a total of 3,125 km of roads throughout the three senatorial districts; and a total of 15 flyover bridges have been completed to resolve traffic conflicts on the Ogun Standard Roads in the three senatorial districts, while three others are at various stages of completion, and three more will be constructed, making a total of 21.
“A total of 13 bridges constructed over various rivers in the three senatorial districts of the state, while 10 more are on-going in the state. In addition to these, several roads construction projects have been earmarked for this year. They include: construction of an additional 100km of Ogun Standard Roads; construction of 25 Ogun Standard Semi-Urban Roads, spanning a total distance of 293.34km throughout the state; construction of another 171 Ogun Standard Rural Feeder Roads spanning 1.282.50km in all the 20 local governments and 37 local council development areas (LCDAs) in the state; and rehabilitation/maintenance of additional 5,000km of Rural Roads across the state.”
On transportation, Amosun stated, “We believe that an inter-modal transportation network is essential for maximising economic growth.”
He said the state had developed “strategically placed railways and an airport” integral to the state’s development agenda. “This will go a long way in promoting the Regional Integration Programme of the South-west. The first phase of the Ogun Light Rail Network is approximately 102.3km and consists of two lines: Abeokuta (Panseke)-Sagamu Interchange-Sagamu town (49.8km); and Ogere town-Sagamu Interchange-Berger (52.5km),” he stated. Amosun added, “The federal government has committed funds in the 2018 budget for the development of an international airport in Wasimi, in Ogun Central Senatorial District, and construction work at the site has actually begun. In fact, we have always paid compensation to the affected villagers. This strategically located international airport will be used for passenger and cargo transportation, serving as an alternative to the Murtala Muhammed International Airport in Lagos. The airport will strengthen our state’s position as an inter-modal logistics hub for the West African sub-region, promoting commercial activities around the state. It will support our aspirations to be an exporter of high value agricultural produce, enhance the tourism potentials, and allow us to offer greater flexibility to private investors across Nigeria and beyond.”
Economic Collaboration
Vice President Yemi Osinbajo urged Lagos and Ogun states to exploit the proximity between them to achieve regional economic integration. Speaking at the forum, Osinbajo said, “Apart from being an industrial hub, Ogun State ought to be a business preference of choice for anybody that wants to do business in Nigeria.
“There ought to be a deliberate collaboration between Lagos and Ogun states for future economic benefits. Recently, I attended a collaborative economic summit between Kano and Lagos states, but I wonder why such could not be reciprocated here, especially between and among Lagos and Ogun states, and Republic of Benin because of the proximity. They should come together, so that the potentials that abound can be exploited. There should be a sub-regional meeting and cooperation between and among Lagos, Ogun, and the Republic of Benin.”
Osinbajo disclosed that the federal government had made available N1.91 trillion to support states in three key areas, namely, anchor-borrowing, social investment, and budget support.
Prudence
In her own remarks, Minister of Finance, Kemi Adeosun, explained how the administration of President Muhammadu Buhari, upon assumption of office on May 29, 2015, resisted the pressure to sack civil service workers during the last recession, owing to the sharp drop in government revenues. Adeosun said the government had two options.
“The first option was either to rebalance its books by cutting down on expenses through massive sacking of workers, or to invest massively in infrastructure and the economy,” she stated. “But we chose to stimulate the economy with massive investments on roads, power, rails, and other infrastructure as part of the deliberate efforts to grow the economy. We have invested over N2.5 trillion in infrastructure between 2015 and 2017.”