Corruption, hostile environment hinder US investments in Nigeria
Sopuruchi Onwuka
The government of the United States of America has blamed uncongenial business environment and fear of corruption as key hindrances to investment capital flow from the world’s biggest economy into the Africa’s most populous country.
The American Secretary of States, Mr Antony Blinken, who was in the country as part of his African tour tasked the government of President Bola Tinubu “to make sure that this is the most inviting business environment possible.”
He said that the United States had a growing interest “in working with Nigeria, investing in Nigeria, partnering with Nigeria,” regretting that corruption and Nigeria’s foreign exchange squeeze pose hindrances to the ability of foreign companies operating in the country to repatriate capital and profit to home countries.
Mr Blinken challenged the Tinubu government to root out corruption and make the operating environment inviting enough to international investible capital.
Foreign businesses in Nigeria require permission from the central bank to return funds to their home countries.
The Oracle Today reports that the Central Bank of Nigeria (CBN) has been unable to clear a backlog of about $7.0 billion in matured forwards following acute shortage of foreign exchange associated with the mindless borrowings by the past administration of former President Muhammadu Buhari whose plunged the country into huge external debt burden.
While the central bank has assured investors, businesses have complained about long delays in recent years as Nigeria’s foreign reserves dwindle as a result of a drop in global oil prices and Nigeria’s own crude production.
Sectors directly affected include manufacturing, aviation, and petroleum. Foreign airlines including Emirates and United Airlines have had to suspend their operations in Nigeria over inability to access their millions of dollars in income.
The inability of the CBN in recent years to convert Naira denominated income to foreign exchange, and remit same to international business operators remain huge disincentive to foreign direct investments in the country.
In promising greater US investments in Nigeria, Antony Blinken called on the Tinubu administration to guarantee repatriation of funds for investors.
Hailing Nigerian ingenuity, Blinken said that the United States had a growing interest “in working with Nigeria, investing in Nigeria, partnering with Nigeria;” adding that “there are challenges that still need to be met to make sure that this is the most inviting business environment possible.”
He said he spoke to Nigerian leaders about issues “including the ability to repatriate capital, including the ongoing challenge of rooting out corruption”.
