Financial expert has urged the federal government to put in place policies that will create job opportunity and attract foreign direct investment (FDI) into the economy.
Chief executive officer, Financial Derivative Company Limited, Mr. Bismarck Rewane, who stated this at a at seminar organised for financial journalists and business editors said that foreign direct investment is less volatile to the economy, adding that rebasing would have higher impact on foreign portfolio investment than foreign direct investment and domestic investment.
He said that the experiences of other countries have shown that rebasing can lead to increase in investment, but there are factors within the Nigeria’s investment climate that might militate against such scenario in the country.
He further explained that even though there are countries that have rebased and experienced higher foreign inflow, Nigeria has to work on improving its competitiveness and removing the identified problems to investment.
According to him, Nigeria has to exploit the new opportunity presented in the service sector; but this has to be done without jettisoning its industrialisation goal, because in the end, industrialisation is necessary for sustainable growth.
Rewane said that rebasing of the nation’s GDP has led to a change in total nominal GDP in a range above 60 per cent, but majority of this increase was generated by the service sector, implying that Nigeria is heading towards a more service-oriented economy.
In his paper titled, ‘Gross Domestic Product Rebasing and Implications for Nigeria’ Investment Environment,’ he argued that the investment environment in Nigeria is shaped by some macroeconomic, governance, infrastructure and other micro factors.
“While some successes have been recorded in the macroeconomic environment, much still have to be done to other factors as they grossly limit the competitiveness of the country,” he said, adding that theoretically, rebasing may boost investment in Nigeria, especially foreign investment.
The Financial Derivative boss said that the newly rebased figures may influence government attention in some sector and this could lead to higher public investment provided attention to other sectors is not reduced.
