FG woos Austrian investors with 20% dollar returns

The Federal Government has told Austrian investors that businesses operating in Nigeria are recording returns of more than 20 per cent in dollar terms, as it intensifies efforts to attract foreign capital into the country.

The Minister of Budget and Economic Planning, Abubakar Bagudu, disclosed this while wooing investors at the GPF Global Vienna Meeting in Vienna, Austria, on Tuesday.

A statement issued by the ministry said Bagudu addressed the meeting virtually on “Financing Africa’s Future: The Vienna Stock Exchange as a Gateway to European Capital Markets for African Government Projects.”

The minister said prospective investors would not regret investing in Nigeria, claiming that existing investors were earning more than 20 per cent return on investment in US dollars.

The statement read, “He said prospective investors would not regret doing business in Nigeria, as existing investors in the country were earning over 20 per cent return on investment in US dollars.”

According to the statement, Bagudu argued that Nigeria’s large population and demand for capital provided opportunities for Austrian companies, particularly those with expertise in technology.

“We are confident that Nigeria is a proven market of choice with strong absorptive capacity, with over 200 million people. So, Austrian companies and businesses well-rooted in technology can operate profitably in Nigeria,” Bagudu was quoted as saying in the statement.

According to him, economic reforms implemented by the President Bola Tinubu administration over the past three years have improved macroeconomic predictability and investor confidence.

Bagudu said the reforms were designed to remove distortions in the economy, including in the foreign exchange market, and provide a rules-based environment for private capital.

He maintained that the measures had stabilised the macroeconomy and made the foreign exchange market more predictable for investors seeking to move capital into and out of Nigeria.

“The forex market has stabilised, with free entry and exit. Foreign reserves have risen significantly to over $50bn, providing over 11 months of import cover,” the minister said.

Bagudu also cited increased revenues accruing to the three tiers of government as one of the gains from the economic reforms, saying the additional resources had provided governments with greater capacity to deliver services.

He added that movements in Nigeria’s bond spreads reflected improved confidence in the economy.

The minister’s pitch comes as the Federal Government seeks foreign investment to support its ambition of expanding the Nigerian economy to $1tn by 2030.

Bagudu said achieving the target would require greater access to foreign capital, adding that the government considered the Austrian capital market an important potential source of financing.

He also disclosed that the Ministry of Budget and Economic Planning, the Ministry of Finance and Austrian officials working with the Austrian Stock Exchange had established ESME Limited as a special purpose vehicle to mobilise capital for investments in Nigeria.

According to him, the company has two representatives of the Ministry of Finance Incorporated and Austrian businessmen on its board.

Bagudu explained that the company would issue bonds on the Vienna capital market to finance investments by Austrian and other companies in Nigeria.

The proposed financing would target green technology, waste-to-energy, textiles, pharmaceuticals, agriculture and water projects, among other sectors. The facility is also expected to provide financing for companies seeking to expand existing operations in Nigeria.

Bagudu said the Tinubu administration welcomed the progress made towards the proposed bond issuance and expected the initiative to deepen business relations between Nigeria and Austria.

He argued that the similarities and comparative economic advantages between both countries provided opportunities for stronger investment relations.

The minister urged Austrian businesses to take advantage of Nigeria’s large domestic market and investment requirements as the government pursues its economic expansion programme.

He maintained that the reforms implemented since 2023 had created better conditions for investment and strengthened confidence in the Nigerian economy.

Bagudu said the government expected the planned bond issuance through the Austrian capital market to open another financing channel for companies interested in investing in Nigeria while supporting the country’s push to attract private capital into productive sectors.