Nigeria’s Dev Plans, Summary NIIMP, NIRP, ATA Ike Onyenokwe/IndexConsulting

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NIIMP Infrastructure Spend Projections Ike Onyenokwe/INDEX CONSULTING

NIIMP Infrastructure Spend Projections Ike Onyenokwe/INDEX CONSULTING

Ike Onyenokwe/INDEX CONSULTING NIIMP Ike Onyenokwe/INDEX CONSULTING

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Ike Onyenokwe/INDEX CONSULTING NIIMP Ike Onyenokwe/INDEX CONSULTING

Ike Onyenokwe/INDEX CONSULTING NIIMP Ike Onyenokwe/INDEX CONSULTING

Ike Onyenokwe/INDEX CONSULTING NIIMP Ike Onyenokwe/INDEX CONSULTING

Ike Onyenokwe/INDEX CONSULTING NIIMP Ike Onyenokwe/INDEX CONSULTING

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Ike Onyenokwe/INDEX CONSULTING NIRP Ike Onyenokwe/INDEX CONSULTING

Ike Onyenokwe/INDEX CONSULTING NIRP History shows that no country has ever become rich by exporting raw materials without also having an industrial sector, and in modern terms an advanced services sector. The more a country specializes in the production of raw materials only, the poorer it becomes. Industry multiplies National wealth ! Ike Onyenokwe/INDEX CONSULTING

NIRP Underlying Philosophy The NIRP’s underlying philosophy is to: build Nigeria’s competitive advantage, broaden the scope of industry, and accelerate expansion of the manufacturing sector. The NIRP adopts both a direct and an indirect approach to promoting industrialization. The direct approach identifies sectors where Nigeria can truly win and dominate, based on an assessment of our country’s comparative advantage. The plan proposes specific initiatives and interventions to improve productivity in those target sectors and increase production output. Ike Onyenokwe/INDEX CONSULTING

NIRP Underlying Philosophy, cont’d. The NIRP also adopts an indirect approach in tandem, thereby acknowledging that it is sometimes difficult to predict where free market forces will lead industry and which sectors will be transformational winners. As such, the NIRP establishes cross cutting interventions that address competitiveness of the entire manufacturing sector in Nigeria (i.e. regardless of sector). These indirect interventions create a broad “Nigerian platform” for manufacturing to thrive, while private capital determines which sectors will grow. Ike Onyenokwe/INDEX CONSULTING

Ike Onyenokwe/INDEX CONSULTING NIRP Vision Our vision for Industry in Nigeria, is to make it the dominant job creator and income generator over the next 5 years. The NIRP will ensure that Nigeria becomes: i) The preferred manufacturing hub in West Africa. ii) One of the top 2 manufacturing hubs in West Africa. ii) The preferred source for supplying low and medium-technology consumer and industrial goods domestically and regionally. Globally, Nigeria seeks to become a top 10 player in at least 10 key manufacturing categories within the next 5 to 10 years. The national policy aims to promote capacity expansions within existing Nigerian manufacturers, hasten their growth, and also bring in new investors into Nigeria. Ike Onyenokwe/INDEX CONSULTING

Global Trends in Manufacturing The Manufacturing sector currently contributes 17% of the world’s US$ 70 tr economy, & accounts for over 70% of global trade. Poor countries start off by employing the bulk of their population in agric, however for these countries to transition into middle income/developed markets, they must create a robust industrial & services sectors, which are the drivers of mass employment, improved skills, & better wages, providing the foundations for long run sustainable economic growth & advancement Also, increasingly the manufacturing sector drives the creation of service sector jobs. In advanced markets, 30% to 55% of service jobs are related to the manufacturing sector. Ike Onyenokwe/INDEX CONSULTING

Global Trends in Manufacturing When evaluating the global manufacturing industry, the key question for Nigeria is where to focus its efforts in building a strong market position. The NIRP adopts the following guiding principles in promoting Nigeria's industrialization: (i) A focus on labour intensive low and medium technology manufacturing (ii) Building up core base industries that are essential for other more advanced industries to thrive later (iii) Using the large Nigerian market demand to deepen industrial capacity of local firms, as a first step, before going regional and global (iv) Strategically using key manufacturing sectors as technology drivers of the economy Ike Onyenokwe/INDEX CONSULTING

Global & Nigeria Economic Growth Trends When evaluating the global manufacturing industry, the key question for Nigeria is where to focus its efforts in building a strong market position. The NIRP adopts the following guiding principles in promoting Nigeria's industrialization: (i) A focus on labour intensive low and medium technology manufacturing (ii) Building up core base industries that are essential for other more advanced industries to thrive later (iii) Using the large Nigerian market demand to deepen industrial capacity of local firms, as a first step, before going regional and global (iv) Strategically using key manufacturing sectors as technology drivers of the economy Ike Onyenokwe/INDEX CONSULTING

Nigerian Manufacturing Today When evaluating the global manufacturing industry, the key question for Nigeria is where to focus its efforts in building a strong market position. The NIRP adopts the following guiding principles in promoting Nigeria's industrialization: (i) A focus on labour intensive low and medium technology manufacturing (ii) Building up core base industries that are essential for other more advanced industries to thrive later (iii) Using the large Nigerian market demand to deepen industrial capacity of local firms, as a first step, before going regional and global (iv) Strategically using key manufacturing sectors as technology drivers of the economy Ike Onyenokwe/INDEX CONSULTING

Nigerian Manufacturing Today Nigeria’s limited industrial sector is strikingly evident when considering trade flows. Today, the industrial sector contributes just 3% to export revenues but accounts for over 50% of imports. The country’s trade balance on manufactured items is therefore causing a severe drag on Nigeria’s balance of payments. Oil overwhelmingly dominates our trade at over 90% of total exports but drives a very small portion of other industrial activities, incl. refineries. Ike Onyenokwe/INDEX CONSULTING

Nigerian Manufacturing Today Sub-sectors & Product Categories Ike Onyenokwe/INDEX CONSULTING

Ike Onyenokwe/INDEX CONSULTING NIRP SWOT Analysis Abundant raw materials , ~ 44 solid minerals in commercial quantity Large market, ~ 170m, 7th most populated in the world/#4 by 2050, USD100bn consumer spend pa Strategic location (Gulf of Guinea) Abundant labour, ~ 69m, largest in Africa International /regional political clout Infrastructure deficit/high cost of doing business High interest rates/ cost of capital; paucity of LT capital Policy inconsistency Few/No institutions to drive industrialization Low industrial skills and innovation Weak metrology and standards Weak competition, and fair trading Weak/inconsistent tariff regime Low consumer purchasing power Low patronage of ‘Made in Nigeria’ goods S W Potential to be #1 in Africa (& top10 globally in many industrial sectors Build up labour-intensive sectors, with unemployment @ 21% Produce locally for domestic consumer market Become the mfg hub for Ecowas & Africa Attract investments from East Asia, where labour costs have begun to rise Diversify exports O Recent large oil/gas discoveries globally Increased competition on industrialization Trends in trade policies – globalization & regionalization T Ike Onyenokwe/INDEX CONSULTING

NIRP Goals and Objectives Designed as a 5-yr plan to accelerate the build- up of industrial capacity Expected outcomes incl.: Job creation Econ & revenue diversification Import substitution Export diversification Broadened govt . tax base NIRP is unique because, it is: Strategic Holistic Integrated/linked to other ministerial plans Execution focused – clear goals, priorities, accountabilities, etc. Focused on building institutions Ike Onyenokwe/INDEX CONSULTING

Best Practices in Industrialization NIRP draws heavily from China’s and Brazil’s Industrial Development paths Key elements of China’s path Key elements of Brazil’s path Special economic zones (ie, Industrial Cities) Export-oriented private investments Investment promotion Monetary & fiscal instruments Targeting specific parts of global value-chains A mixed approach to market structure Focus on financing Industrial skills and innovation Local patronage A major focus on local demand Strategic protection The examples of China and Brazil show that every country must develop its own unique recipe for industrialization Ike Onyenokwe/INDEX CONSULTING

NIRP Sectoral Priorities Priority sectors possess regional/ international comparative adv., based on… Existing skills & installed capacity Natural endowments Competitive cost base Labour intensity Potential for linkages with other industries Local & regional demand Ability to export to developed markets Potential for econ. Impact, job creation, & opening up new non-oil export markets Support structures will serve as enablers to unleash productivity across board, by reducing (or removing) structural impediments to Nigeria’s industrialization Ike Onyenokwe/INDEX CONSULTING

NIRP Information, Measurement & Feedback Resource mapping Supplier and skills searches Industrial performance indices NIRP outcomes measurement NIRP will pursue the following initiatives… NIRP interfaces with other development plans in Nigeria Ike Onyenokwe/INDEX CONSULTING

NIRP Linkages with Other Development Plans Ike Onyenokwe/INDEX CONSULTING

NIRP Expectations on Investments & Economic Impact Ike Onyenokwe/INDEX CONSULTING

NIRP Expectations on Investments & Economic Impact Ike Onyenokwe/INDEX CONSULTING

NIRP on Nigerian Oil/Gas Related Industries Nigeria is endowed with some of the largest oil and gas reserves in the world. Current proven oil reserves are estimated at 37.14 b bbls (10th largest in the world), and gas reserves estimated at 187 tcf (7th largest in the world). Oil production has historically ranged b/w 1.7bpd and 2.4 bpd, while about 2.4tcf of gas is produced annually, of which a third is flared. Nigeria’s Oil and Gas Industry however has been dominated by upstream oil and gas activities, with little investments in midstream processing and downstream hydrocarbon related industrial activities. The Nigerian oil and gas Industry accounts for 95% of FX earnings and between 60% and 70% of total government revenue, yet it only contributes less than 15% of the nation’s GDP. Currently Nigeria exports primarily crude oil and gas, whilst at the same time importing value-added petroleum based products. Therefore, opportunities for industrialization of Nigeria using the Oil & Gas sector are enormous by investing heavily in Petrochemicals, Methanol, Fertilizers, Refineries, and other Gas based processing activities. Ike Onyenokwe/INDEX CONSULTING

Oil & Gas Industrial Development Action Plan NIRP draws heavily from China’s and Brazil’s Industrial Development paths Key Challenges Action Items (Phase 1) Insufficient oil and gas pipeline infrastructure Oil & gas supply inconsistencies Increasing international competition for credible global sponsors Low local technology availability High capital intensity Development of Oil/Gas Industrial Cities Agree guidelines on domestic supply obligations for gas based manufacturing Investment promotion and sponsors Establishment of the Nigeria Oil/Gas Industrial Development Committee Regional market penetration for Nigerian oil/gas products in W & C-Africa Capital mobilization The examples of China and Brazil show that every country must develop its own unique recipe for industrialization Ike Onyenokwe/INDEX CONSULTING