We'll have a wagon of foreign investors in Delta soon - Ofehe

*We can attract minimum of $1bn in foreign direct investment to Delta in 2024 quota - Ofehe


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We'll have a wagon of foreign investors in Delta soon - Ofehe
Chief Sunny Ofehe


 

 

Chief (Comrade) Sunny Ofehe, is the Executive Assistant on External Relations and Diaspora Affairs to the Delta State Governor, Chief Sheriff Oborevwori. In this interview, Ofehe speaks on various issues, with particular emphasis on how foreign direct investment can be attracted to Nigeria and Delta State in particular. 

 

 

 

 

How do you plan to sell Delta State to the rest of the world as an Executive Assistant on External Relations and Diaspora Affairs?

 

 

We're not just going to sell Delta State to Nigerians in the Diaspora alone; we're going to sell Delta State to the global community at large. Delta State is very easy to sell. Delta State, as it's today, is the gateway to the South-South and South-East regions of Nigeria. 

 

 

Delta State today is the only state with two major functioning airports in the State capital Asaba with an international standard runway that can land even an airbus A380 and the other airport located in the State’s commercial hub city of Warri. 

 

Delta State today is the only state with despite underachieving four major seaports in the world, we have about 165 kilometers of coastline, which can also open doors to many economic activities including huge potential in blue-economy. And of course, currently we're the largest producer of crude oil in the country, and we have the highest gas reserve in the country. 

 

 

So we have all the abundant natural and mineral resources, even solid minerals to be precise, and in addition to that, we have high human capital development in the state because we pride ourselves as the state with the highest tertiary institutions in this country. So selling Delta State is as easy as selling anything that is good, and that is why we want to take a different approach this time around and look into how we can showcase Delta State beyond the crude oil that we are generally known for.

 

 

That's a very good investment pitch, and I am sure if you're in a road show, I think investors will appreciate what you just said. But looking at crude oil, we have oil theft; looking at solid minerals, we have smuggling. How will you assure potential Diaspora that the money they commit to Delta State will be safe and secure?

 

 

 

The current administration is working tirelessly to harness all the MDAs to jiggle all the officials that have been appointed, saddled with various responsibilities to push the state's potential in natural resources and human capital development around the world. So when you talked about the issue of oil theft, you talked about how we would assure investors. That's why the focus of this current MORE Agenda is on the area of infrastructure and security, and hopefully when we start rolling out those policies, we will be able to deal with those challenges that have been confronting us before now.

 

 

The Governor, His Excellency Sheriff Oborevwori, just presented the 2024 Appropriation Bill of N725 billion naira that has been signed into law by the State House of Assembly. The approved budget is made up of N317 billion naira in recurrent expenditure, while the sum of N408 billion naira is for capital expenditure. 

 

 

This budget has been tagged, the “Budget of Hope and Optimism”, which is geared towards putting the economy of the state on the path to sustainable growth. The budget would boost both domestic and foreign direct investments with increased productivity while at the same time enhance the ease of doing business in the state. The budget is cutting down on recurrent expenditure in other to free up more funds for the sustainable financing of the State’s critical infrastructure and human capital.

 

 

For the first time the government is focused, improving the ease of doing business so that we can attract domestic and foreign direct investments, and improve productivity while sustaining the growth of our domestic economy. Remember that since the commencement of this administration in the last six months, there has not been a single borrowing. 

 

 

Therefore, we are not only guaranteeing the security and safety of our Diaspora investments but we are also assuring them of a better business investment climate in Delta State.

 

 

 

What about fashion? What is the Delta State Government going to do in the area of fashion?

 

 

 

We pride ourselves on being one of the most dressed people in the country. There is this popular saying that “Warri nor dey carry last” and that has been in our DNA. As an administration, in the area of fashion, the state government is looking at investments in the key critical textiles sector. 

 

 

We used to have Asaba Textile Mill in Asaba, and we know today that about 70 percent of what most people wear, including what I am wearing today, is all made in Nigeria. So this current government is seriously looking into dragging in investment into the area of textiles. So we cannot only improve on our usual well-known way of dressing but also become the hub of textile products not just within Nigeria but across sub-Saharan African countries.

 

 

In doing this, we will be able to create jobs for our young population while exposing them to modern system of textile production and the finishing. I can assure you that Delta State will become the red carpet of the global fashion industry.

 

 

 

How challenging is this job for you because the Delta State Government has given you an enormous task to seek money and investors for the state?

 

 

 

It's not challenging because I have lived in Europe for 28 years, and every day of my stay in Europe, I have always talked to friends and people who run companies and are willing to invest in Africa, most especially Nigeria, so it is a convenient zone for me. It's a place where I really strive because I see a lot of amazing opportunities. 

 

 

I see the determination of many Western companies to do investments here, but issues such as security and lack of infrastructure have always been the problem, particularly the challenges involved in their reaching out to the people who can actually take decisions as to how these investments can come into Nigeria.

 

 

In other to mitigate these challenges, that is why this administration has devoted almost 60% of the 2024 budget on infrastructure particularly the construction of access roads, major expansion and fly-overs across the major cities. His Excellency, the Governor has also taken security as one of his major priority, meeting regularly with all the major security stakeholders in the state and providing the needed support and encouragement for effective discharge of their duties.

 

 

 

So this is your terrain. For 28 years, you have been doing it. In those 28 years, how successful have you been because you are a Deltan? How successful have you been in terms of convincing your colleagues and prospective investors to come and invest in Delta State?

 

 

 

I actually come into the country with a whole lot of them for them to see our hospitality and the potential that we have in human capital development, and they can also see that Nigeria is not as insecure as it's internationally claimed. 

 

 

Every country has its own challenges and a country is built on the past, present, and future, so we have our past, we're dealing with our present, and we're very optimistic about our future. When you look at Delta State today, the governor has defined his vision in a “MORE Agenda”, and he has started very well. For the first time, the state has contracted Julius Berger to do major flyover bridges construction to the tune of about N78BN naira in his first 100 days in office.

 

 

Just recently I came with some European investors and Dutch experts on flood managements and shoreline protection. We even embarked on a trip to several communities in Escravos in Warri South-west Local Government area of the State and they were amazed with what they saw. They all planned to visit again and bring their knowledge and expertise. 

 

 

Whenever, I visit Delta State with foreign investors, I always ensure that they see our urban and rural communities and their lifestyles. They also see the potential we have in both natural, mineral and human capital development. 

 

 

 

What part of your 28 years in Europe has made it easier for you to convince investors to come in because, for the past 28 years, Nigeria has seen different economic circles?

 

 

 

I think now it is a bit easier with the advancement of modern technology - the internet, and social media. You can sit in one remote location and view or relate anything you want to say about Delta State, and then the awareness is there for everyone to verify. 

 

 

Today, Nigeria is the largest economy in Africa, with a highly growing young population. We're the most populous black nation in the world. Our labour is also very cheap. These are incentives to attract foreign direct investment. 

 

 

So when you talk about the global North and the challenges they are facing from their Chinese counterpart, you know there is this determination now from western countries to look into how they can plug themselves into investment opportunities that are open within the Nigerian economy. 

 

 

So Nigeria is resonating very well with potential investors and this last trip I made, I came with about five investors in different sectors and we have looked around our state and had discussion with senior government officials so the government is laying the groundwork for investors to come in. We are looking at infrastructure as a major area that we need to improve upon to be able to attract this investors. 

 

 

And if you look at some countries in Africa, for instance, Botswana, as of 1966, when they gained independence, their annual per capita growth domestic product was about 70 dollars with just 12 kilometers of pave roads, but they were able to open up their diamond market to attract just one company to come in and do investment. Today, Botswana's annual per capita GDP is more than 800 million dollars, surpassing even their neighbor, South Africa. That's what foreign direct investment can do to your economy.

 

 

 

 

But for Botswana, we saw economic policies; there was also serious, transparent leadership, and they resolved to open up the space for investors. What do you think we have been lacking as a country to attract foreign direct investment as much as we should in the past 10 years? Foreign direct investment has been declining, and what we have are portfolio investments, whereby when the economy is a bit okay, they stay once it is not, or when they see the interest rate going higher, they just pack their briefcases and leave. What have we not done right, and why is it challenging for us to bring in FDI at a time when we really need it as a country?

 

 

 

 

I think the first thing is security. You can't invest in a country where every time you hear news of bombings, killings, and all that. The second one is infrastructure. You know we lack major roads. And thirdly, our fiscal policy is very poor. When you want to attract investors, you must guarantee that there must be security on their investment and there must be guarantee on their investment. 

 

 

Most importantly, you must allow them to repatriate their profits and their funds back to their home country. Look at the airline industry, for instance. It is said now that the International Air Transport Association, IATA, has said that there is a total amount of $2.3 billion in unrepatriated funds for major airlines across the world, and in that figure, Nigeria happened to be the highest, with $812 million. Look at the countries that follow: Bangladesh, Lebanon, and Pakistan. We shouldn't be in the league with those countries. 

 

 

So in order to attract these investors to come in, you must guarantee and assure them that whatever they make in your country, they will be able to have an easy financial corridor with which these money can be repatriated back to their country, You must also lay down the enabling environment for such investment to come in. You must look at your critical infrastructural sector, and that's what Delta State is doing now. Tackle your infrastructure challenges; open the way for investors to come in so that you can use those investments that are coming in to be able to create jobs and improve infrastructure.

 

 

 

From what you have said, how much FDI can Nigeria attract in the absence of infrastructure? I also know our infrastructure needs are also investment opportunities, but how much FDI can we attract when we don't have good roads, with our airports not functioning optimally, our constant epileptic power supply, etc.?

 

 

 

We can start with those infrastructural challenges as our area of FDI attraction. You just mentioned power. There are several alternative ways of generating power these days, particularly if it's a way of using clean energy to generate power and then putting your investment in those sectors. 

 

 

You can also look at other areas, like agriculture and solid minerals. I just mentioned Botswana relying on just Diamond. We have a whole lot of solid minerals that we can tap into. There are many companies that are willing to come and explore that sector of our economy. The volume of what we can attract is very high. 

 

 

Look at countries like India and even Brazil. Brazil has been able to increase its foreign direct investment flow in the first quarter of 2023 to about 21 billion dollars, even surpassing China. So Nigeria can fall in the league of those countries because, in terms of human capital, we have a young and dynamic work force with cheap labour, which we can tap into. We also have abundant natural resources that are still very much untapped. for instance, lithium. 

 

What stops us from discussing with companies like Tesla to come in and explore our lithium potential so that they can even set up a battery factory here that would not only create corporate and income taxes but will also at the same time create jobs for our teeming unemployed graduates who are out there? These are the areas we need to look at. 

 

 

Then also create the enabling environment. You talked about the area of aviation and our airports.  I was flying from Lagos to Abuja; my flight was originally scheduled for 6 p.m., but I got an email that they had rescheduled the flight for 2 p.m. due to operational issues. So they brought the take-off time backward for the same day. You don't do that! What about if I have a crucial meeting by 4 p.m. and I decide to leave at 6 p.m.? Now you're forcing me to suddenly change my plans and I have paid you; you've given me a time slot; now you're forcing me to come and travel. So those things can also affect investors when there are inconsistencies in the system. 

 

 

It is only in Nigeria that I see when you come to the airport people are asking, “Is the flight on ground?” You don't see that in any other part of the world. We need to work on those things. I was in Nigeria for like nine days, and I had two major challenges in the aviation sector. I was supposed to take off from Abuja to Asaba. We were on schedule to be the number three flight to hit the runway, then there was a flight that shot off the runway. That cost us about six hours of delay. The flight was not even blocking the runway, but the exit for entering and exiting the gate. 

 

 

These are areas you think are little hiccups, but by the time you start accumulating them together, you will understand the damages.  Any investor who wants to come here must do their research, do their due diligence, look at the environment, see if it's feasible, see if it's workable, and all that. Emirates is not flying to this country today, and most of the airlines have chosen not to use Nigeria as a hub for crew change. Those are losses in revenue and investment.

 

 

 

Let's take a look at this FDI more closely.  We will say we have the capacity to take as much money as we can. I think for roads, we need about 3 trillion dollars, at least for the next 30 years, to do our roads. President Tinubu has been going everywhere. Do we really have the capacity to take in FDI of over 200 billion dollars? For example, Delta state, if investors bring in money, is there propensity that they will make profits from that money in Delta State which is one of the oil rich state managed an FDI of about 1 million dollars until 2022. So if you take a look at this, how feasible is these? 

 

 

 

If you look at the MORE agenda of Delta State, that's why the emphasis is on infrastructure. Developing our roads, ensuring that we create a good public space for investors to come in, and there will always be a return on such investments, but the return on investment can be minimal because you have to mitigate the challenges that come from infrastructure. 

 

 

You talked about the highways; as it is right now, it is clear that the Federal Government cannot handle the major highways and the costs that are accruing following the inflation rate we currently have in our economy today. So what I would have suggested that this administration can do is price our roads. Return to the tollgate system, and then privatize those roads. 

 

Give the private sector the opportunity to invest in it and recoup their investment through people going through that road and paying for that road, where maintenance can be in their own hands. So once you're able to get that right in terms of infrastructure, the investment will definitely flow in, and investment in Nigeria and Delta State is not limited to just one sector like what we're seeing today, now that Nigeria is a mono-economy, relying almost 99 percent on crude oil. 

 

 

We should shift from that and move into, rather than becoming a consumption economy, looking at how we can become a production economy. We should also refrain from becoming an import-dependent economy and instead become an export-dependent economy. How do we do that? We can invest hugely in our agricultural sector and become one of the largest exporters of agricultural produce to other parts of the world.

 

 

 

 

What kind of FDIs do we need? Because there are different kinds of FDIs due to the peculiarities of the Nigerian economy, what kind of FDI does Nigeria need?

 

 

 

When you talk about the kind of FDI that we need, we just need to woo companies with technical expertise in specific sectors so that we know that we have the capacity to be able to sell what we have to the world. For instance, in agriculture, power, and solid minerals, that is one untapped area. We can also use our human capital advantage to attract FDI. 

 

 

I fly KLM and Air France. If you call KLM and Air France today and press option 2 for English, it will automatically connect you to Philippine, where they have a bunch of young people who are doing telephone services for them. This can be done by outsourcing. Delta State, as we speak right now, has the highest number of tertiary institutions in the county. 

 

 

What does that mean? That means we have the highest number of intellectually sound young people in the country. These can be used to attract investments in the human capital development indexes.

 

 

 

But you may not judge by that because it is a different thing from having infrastructure and the illiteracy rate. Yes, having infrastructure can boost your literacy rate, but having educational infrastructure doesn't mean that you are also producing literate people. I hope you understand my point?.

 

 

 

I do understand, but you cannot rule out the fact that in Delta State, we have abundance in human capital development when you talk about the entertainment industry, when you talk about the banking sector in the country today, even the media sector, we have the highest. So we should capitalize on that potential as a state, and that is what we are currently doing. 

 

 

Delta State is a name that's synonymous with investors across the world. Delta State has the capacity to become the seventh-largest economy in sub-Saharan Africa. We are surely driving in that direction. We have a governor right now who is listening. 

 

 

Most of the foreign direct investment potential we will bring to Delta State will be like a pilot that will showcase itself for other states to follow. The target is for us to ensure that before the end of next year 2024, we will outgrow the 1.1 million dollars that you or NBS said are the highest we could bring in 2022. Our target is to grow that, and we are working toward that. We are definitely going to improve on that because Investors are coming in from all sectors.

 

 

 

If we are saying we need FDIs, what kind of policy incentives are we putting in place? I mentioned earlier that about 27 states attracted zero FDIs into their states. States like Lagos got 3.6 billion dollars in 2022, but the issue now is: what is Delta State putting on the table in terms of policy incentives? And how are you pulling Deltans, talking about the governor, yourself, and your colleagues, because it's not just about coming to Delta, putting those FDIs in place, and at the end of the day, taking those dollars away in terms of capita flight and go?

 

 

 

 

We are not going to do that. I have assured my governor that my office alone can attract in one year on a minimum amount of 1 billion dollars in foreign direct investment. I will be in touch with you when we begin to develop this from my office. The secretary to the state government has been engaging foreign investors in the state, so what we will first of all do is create an opening for engagement, which the government is already doing right now, and then we will also structure some possible external visits for the governor to go out there. 

 

 

For instance, we are arranging for him to visit Suriname, a Caribbean country, so that we can seek some collaboration that can help in our aviation sector, that can help in the agricultural sector, and most importantly, create a diplomatic relationship between both countries. Once we are able to do that, there is possibility that, through that, we can access the 1.5 billion dollars that are available from the Africa Import and Export Bank to encourage economic corporation between African countries and Caribbean (CARICUM) countries. so we want to leverage that. 

 

 

The first thing you need to do is understand the lines that are open for this investments. and to even surprise you, what we are doing with our foreign direct investment flow capacity is targeting international companies that will also come with their export credit, so it will not be a financial liability on our state.  

 

 

In some cases, we can agree on counterpart funding, but our counterpart funding portfolio can also come not in the form of money but that we can provide for the investor, such as land, labor and access to licensing, and all of that. So this is what we are actually working toward, and I am very confident that before the end of next year, NBS will make another review of what they have out there for Delta State, and there will be a remarkable improvement on that on the next figure that will be released.

 

 

 

What sectors are you looking at for Delta state.?

 

 

 

In renewable energy, there is what is called carbon capture, and it is unfortunate that it is free money that nobody is tapping into. Delta State will be the first state to invest in a foreign direct investment portfolio carbon capture fund that would surpass even some state total FDI inflow into their states.

 

 

 

 

If we take a look into Nigeria as a whole, what will you say about President Tinubu's travels? Bearing this in mind, I think the World Bank will say in 2022 that Nigeria has the least diversified economy in the world, apart from Angola. We could do better than we are doing, even though we rebase our GDP, and about 15 percent of our GDP is served in agriculture. The oil sector, where we even get the most percent of our forex has been declining in terms of contribution to GDP. So how do we diversify, even the oil sector where we are getting money we haven't seen new investment in that sector in past few years and Delta is also an oil producing state?

 

 

 

Let me start from President Tinubu's travels. I am a proponent of diplomatic engagement. I believe you cannot attract foreign direct investment if you don't go knocking on doors, so the travels I applaud them, they are good, they are putting Nigeria on the map and they are putting Nigeria on the lips of many people so you need that, you need that confidence. 

 

 

Any travel you do bilateral or multilateral you must gain something at the end of the day and that is what we are looking at, when you do that you must also come back to your own country and create the enabling environment for those investors to conveniently come in and do business without hiccups. And when you do that you must look at all the arms of government and strengthen all the institutions with greater emphasis on your judiciary. 

 

 

You must strengthen you judiciary, create transparency in it in the way that if any FDI company is having problem and they want to seek judiciary redress it can be achieve in no time and you must cut your bureaucratic bottlenecks and create a simplified ease of doing business. Like when you import stuff into the country, the processes to follow the paper you have to sign or when you export or people into agricultural export are complaining that before they go through the process of signing and approving documents for their goods to leave most times they become perished by the time they bet to the end destination. So these are the things you have to cut off! 

 

 

You mentioned we being a mono economy relying only on crude oil production even the crude oil production is punctured. There was a time I think this year that even Angola that you mentioned surpass Nigeria as Africa largest exporters of crude oil because we have infrastructural problems and not meeting up the 1.8 or 2 million barrels of our OPEC quota that was supposed to contribute to market. 

 

 

Today Nigeria quota is about 1.1 million barrel of crude oil per day and that is not encouraging at all. This is lose of foreign revenue, however, if you look at our economy before independence it was an agrarian based economy. 

 

 

We were able to live comfortably with that but when the oil boom period came between the 70s and 80s it became a different ball game entirely. We made so much money, so those profits we made from crude oil were supposed to use them to consolidate on our agricultural potentials and today we would have been one of the largest agricultural producing countries in the world but we lost that opportunity. 

 

 

Today we are still struggling within one economy which is not right for a population that is still growing. Any growing population must find a way to attract foreign direct investment because that is the only way you can create jobs, that is the only way you can build your infrastructures like roads, school, hospitals otherwise you will end up borrowing and borrowing and that is what we have been doing. We borrowed from China to take care of our infrastructure but that has to change.

 

 

 

 

I like us to talk about the role of Diaspora remittances especially in attracting FDIs because last year according to official report about 21.9 million dollars was brought into Nigeria as Diaspora remittances. We see increase a bit because we suffered pandemic, the whole would suffered pandemic in 2020. But I am taking a look at how do we strike a balance between Diaspora remittances and attraction of FDI bearing in mind majority of our Diaspora remittances are for personal use. How do you intend to galvanize Deltans and even local direct investment (LDIs) because those of us who are Deltans but not in the state can also come in and invest so how do you strike the right balance between attracting FDIs remittances and those of us that are out?

 

 

 

 

Well, we will critically look at it. You just mentioned in 2022, 21.9 billion dollars was remitted by Nigerians in the Diaspora which is huge, which is second highest after crude oil. But today successive governments have not be taking advantage of the Diaspora potentials.

 

 

In less than two months I have been be contacted by several Nigerians, Deltans and those who are not Deltans reaching out to me believing that as a Diaspora I will understand better the challenges they have been facing trying to invest back home. We have huge potentials. 

 

 

There is no health fund in the world that you don't see any Nigerians working there. There is no multinational companies today in the world that you don’t see any Nigeria working there. And to shock you, even Nigerians here are also stretching their hands out there to attract foreign investment into this country. So I have received a whole lot of proposals. 

 

 

Now what we want to do is that we want to create this bridge between the Delta state government and the Diaspora community so that even when we bring in foreign direct investment, we can do some form of Private, Public Partnership (PPP) arrangement. We can open that to the world so that even the Diaspora can find a way to put their investment into this sectors. So they can also be par-takers of those investment because they know that in doing that there will be a patriotic benefit for them. In a way that employment would come maybe for their families and that can also reduce the sort of money they send to their family to feed.

 

 

 

 

What about those of us here in Nigeria because you can see a lot of Deltans are doing good stuff?

 

 

 

They can still leverage on the opportunities that we are bring in through attraction of foreign direct investment to the state. What we are doing right now is that the government is set and ready to open up the state-of-the-art website where people can have access to everything the government is doing. 

 

 

Like I said this administration is very open to those opportunity that the state has and that opportunity is what we are taking out as our incentives to attract what we need in order to grow our economy but not just to grow our economy but return places like Warri to the original economy and commercial  hub that it used to be.

 

I am assuring you that Delta State under the new “Sheriff” will surely be great again!


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