Onne FTZ grows government revenue to $7.1bn in 2yrs

Given the attractive business environment created by the promoters of Onne Oil & Gas Free Trade Zone for investors to come in, the volume of revenue remitted into the federation account from the free trade zone has grown from $5.4 billion in 2011 to $7.1 billion in 2013, said President Goodluck Jonathan at the closing ceremony of the 2013 Oil and Gas Trade and Investment Forum held in Onne, Rivers State, recently.

According to the president, the number of registered companies that operate within the trade zone has also grown from 150 in 2011 to 170 in 2013, adding that the FTZ also grew its employment generation list from 30,000 in 2011 to 34,000 in 2013, while Foreign Direct Investment (FDI) at the FTZ also grew from $4 billion in 2011 to $4.2 billion in 2013.

“The investment climate reforms embarked upon by the government has helped to attract N6.8 trillion local and foreign direct investments. This is why Nigeria, which accounts for over 20 percent of the FDI flows into Africa, is ranked first in the top five host economies for FDI in Africa. Our port reforms have ensured greater efficiency in the ports thereby reducing the goods-clearing period tremendously, but the target remains 48 hours,” he explained.

President Jonathan, who commended the efforts of Federal Ministries of Industry, Trade and Investment, Petroleum Resources, and Transport, as well as Orlean Invest West Africa for organising the event, also said the event has succeeded in showcasing the place of Public-Private Partnership in growing the economy.

On Federal Government effort to create enabling business environment, the president noted that the Federal Gas Master Plan has taken care of the growth in demand for power to create new investment opportunities for local and international investors.

“Nigeria’s 12-month gas supply energy plan has produced more that the projected volume of gas demand for the power sector,” he said, adding that since inception, his administration has demonstrated the willingness to engage in more flexible and innovative policies that will accelerate economic growth and development in order to put Nigeria in the league of the 20 largest economies in the world.

The Federal Government, he said, has also focused on uprooting barriers to trade and investment in order to stimulate real sector growth.

“As part of our initiatives in the ease of doing business, our visa policy has made it easier for legitimate investors to receive long-stay visa while business registration has been reduced to hours,” he added.

The result of these interventions, according to the president, has been remarkable as the nation has sustained an average Gross Domestic Product (GDP) growth rate of 7 percent in the past two years despite the weak growth in the global economy, adding, “The exchange rate is stable, the dollar exchange rate has been between N155 and N160 over the last two years as inflation rate continues to trend downwards from 12.4 percent in May 2011 to present single digit.”

Findings have shown that the increasing world demand for oil and gas poses supply challenges to the producer nations in terms of investment in oil and gas infrastructure.

According to International Energy Agency (IEA), the world demand for oil and gas was projected to rise from 85 million barrels per day in 2007 to 106 bpd by 2030. This implies that for the world supply to keep pace with projected demand, investment in oil and gas must be deepened.

Here in Nigeria, the president explained, the challenge is more critical in view of the existing infrastructural gap in the sector, which demands huge resources to bridge, saying this was why the nation must leverage on private investment to grow the sector.

Listing other challenges, he noted that oil theft, which relevant regulatory agencies are working assiduously to combat, has become a hard nut to crack, adding that the strategic position of oil and gas in the Nigerian economy has made the present administration to embark on a number of far-reaching measures to check these unwholesome activities.

“Government is exploring the possibility of using electronic pipeline surveillance to track down oil theft while seeking means of making access to petroleum pipelines extremely difficult for vandals,” he disclosed.

He called on all the relevant authorities to ensure that all oil and gas-related cargo are discharged only at the designated terminals to support investment drive, while also urging the agencies concerned to ensure strict enforcement on the ban on midstream discharge of cargo and private jetties from receiving ocean-going vessels directly at their jetties.

These steps, the president noted, would help to guard against breach of the nation’s security and loss of revenue to the government, saying: “Despite the corruption and security challenges confronting the nation, oil and gas sector remains the live-wire of the economy, with great opportunities especially in the downstream petroleum sector.”

The president, who urged prospective investors to take advantage of the numerous incentive packages provided at Onne Free Trade Zones to invest in Nigeria, further assured the entire business community of safety of lives and property.

He re-emphasised that Nigeria offers broad investment opportunities in the oil and gas sector, particularly in growth-engendering areas such as petrochemicals and its derivatives, refineries, gas stations, among others.

In addition, he commended Deep Offshore International Services Limited “for committing the sum of $2.798 billion for the development of phase 4B port facilities at the Onne Port Complex”, enjoining other players to join the race now or risk asking where they were when others were investing in Nigeria.

By: Uzoamaka Anagor