FoSIPAN Inaugurates Joint Steering Committee for Subnational Investment

The Forum of State Investment Promotion Agencies of Nigeria (FoSIPAN) launched the Joint Steering Committee of the Subnational Investment Promotion Strategy (SIPS) on October 15, 2024. This committee will coordinate investment promotion efforts across Nigeria's 36 states and the Federal Capital Territory. It aims to drive state-level investment toward Nigeria's goal of a $1 trillion economy by 2030.

FoSIPAN established the committee in Abuja with representatives from state investment agencies. The committee will develop unified policies and remove barriers to investment. It will focus on sectors like agriculture, manufacturing, and technology. This move follows Nigeria's National Development Plan 2021-2025, which targets 5% annual GDP growth.

Why the SIPS Steering Committee Matters

Nigeria's economy grew by 2.5% in 2023, according to the National Bureau of Statistics. Foreign direct investment fell to $1.1 billion in 2023 from $1.5 billion in 2022. State-level coordination could reverse this trend. The SIPS committee will standardize investment processes across states. It will reduce bureaucratic delays for businesses.

The committee will work with the Nigerian Investment Promotion Commission (NIPC). It will align state efforts with federal priorities like infrastructure and job creation. Nigeria needs $3 trillion in investment to meet its development goals by 2050. State agencies currently operate with varying efficiency. This initiative seeks to harmonize their approaches.

Key Functions of the New Committee

The SIPS steering committee has three main tasks. First, it will create a single window for investment approvals across states. This system could cut permit processing times from 90 days to 30 days. Second, it will develop investment incentives like tax holidays and land grants. Third, it will track and report investment data quarterly.

The committee will prioritize six sectors: agriculture, renewable energy, digital services, healthcare, logistics, and tourism. For example, it aims to attract $500 million in agribusiness investments by 2026. It will also address security concerns by collaborating with state security agencies. Each state will appoint a liaison officer to the committee.

What Businesses Should Watch

Companies should monitor the committee's first policy announcements in early 2025. Look for changes in state-level business registration fees. Currently, fees range from ₦50,000 to ₦200,000 ($33 to $133) per state. The committee may standardize these costs. Also watch for new incentives in export processing zones.

Businesses in Lagos, Rivers, and Ogun states may see early benefits. These states have active investment agencies. The committee could expand successful models to other regions. For instance, Lagos attracted $2 billion in investments in 2023. Its ease of doing business reforms might be replicated.

Investors should engage with state agencies through the new single window. This portal will launch in Q2 2025. It will provide updates on land availability and infrastructure projects. The committee will publish its first progress report in June 2025. This report will detail investment commitments and job creation metrics.

Challenges and Opportunities

The SIPS steering committee faces significant hurdles. Nigeria's states have different legal frameworks. Harmonizing them will require legislative changes. Some states lack reliable power and roads. The committee must work with the Federal Ministry of Power and the Ministry of Works. Corruption remains a concern. The committee plans to implement transparent bidding processes.

Opportunities exist in Nigeria's young population. Over 60% of Nigerians are under 25. This demographic can support labor-intensive industries. The committee will promote vocational training programs. It will also leverage Nigeria's African Continental Free Trade Area membership. This agreement offers access to a $3.4 trillion market.

International partners like the World Bank and Afreximbank may provide funding. The committee will seek grants for infrastructure projects. It aims to secure $100 million in development financing by 2025. Success depends on state governors' cooperation. All 36 governors have pledged support through the Nigerian Governors' Forum.

Next Steps for Implementation

The SIPS steering committee will hold its first working session in November 2024. It will draft operational guidelines by December 2024. These guidelines will cover investment promotion standards and dispute resolution. The committee will then train state agency staff in Q1 2025.

Key performance indicators include investment inflows and job creation. The committee targets 500,000 new jobs by 2026. It will use NIPC data to measure progress. Regular audits will ensure accountability. The committee reports directly to FoSIPAN's governing council.

Businesses can participate through public consultations. The committee will host forums in Abuja, Lagos, and Kano. These events will gather input on regulatory reforms. The goal is to make Nigeria's states more competitive for investment. This effort supports President Bola Tinubu's economic agenda. His administration seeks to double GDP within a decade.