Why Nigeria, Singapore economic and trade relations will move ahead

A fresh atmosphere of positive change has been brought to Nigeria’s trade and investment climate under the watch of President Muhammadu Buhari GCFR, a leader with integrity and steadfastness. I am hopeful that the outcome of this engagement will further consolidate on the gains already achieved in the economic and trade relations between Nigeria and […]

A fresh atmosphere of positive change has been brought to Nigeria’s trade and investment climate under the watch of President Muhammadu Buhari GCFR, a leader with integrity and steadfastness. I am hopeful that the outcome of this engagement will further consolidate on the gains already achieved in the economic and trade relations between Nigeria and Singapore and take the relationship to a greater height for the mutual benefit of both countries.
Nigeria is the most populous country in Africa with a population of about 178 million based on 2014 estimates. This makes Nigeria the largest market in Africa, the most preferred destination of choice for Foreign Direct Investment (FDI) and indeed the largest economy in Africa. The economy is growing at a rapid 6.8% annually, driven by growth not only in oil but also in agriculture, telecommunications and services. The medium-term outlook for Nigeria is very good.
Despite the strong fundamentals of its economy, economic diversification and strong growth have not really translated into significant decline in poverty levels due to inadequate energy supplies and poor infrastructure amongst others.
Singapore is an island country with a population of about 5 million people. Despite its disadvantaged population and landmass, it has the 9th largest foreign reserves and is currently the fastest growing economy in the world. It has a highly developed and successful free-market economy. It enjoys a remarkably open and corruption-free environment, stable prices, and a per capita GDP higher than that of most developed Countries.
The economy depends on exports, particularly in consumer electronics, information technology products, pharmaceuticals, and a growing financial services sector amongst others. It has attracted major investments in pharmaceuticals and medical production technology and it is no doubt, Southeast Asia’s financial and high-tech hub.
The cordial relations between Nigeria and Singapore have been sustained since their independence in 1960 and 1965 respectively.  Both countries have supported each other in the areas of trade and investments.
The relationship blossomed with the establishment of the Nigerian High Commission in Singapore in 2000. Since then and particularly in the years following 2010, there has been an improved economic trend towards investment facilitation, liberalization and promotion of economic and political relations between Nigeria and Singapore.
The relations between Nigeria and Singapore have been on the ascendency since 2012, culminating in the first Nigeria-Singapore Business & Investment Forum in 2013. The Forum significantly improved the knowledge base of the Singaporean business community on the vast business opportunities available in Nigeria and the various policies put in place to provide incentives for Foreign Direct Investment (FDI). It is instructive to note that the Bilateral Air Services Agreement (BASA) for cargo services has been functioning between the two countries since 2012.
The current situation in the business relations between Nigeria and Singapore show there has been increase in activities in recent times. Unfortunately, this is yet to materialize into real trade boom relative to the volume recorded with other regions.
It is worthy to note here that Singapore’s major trading partners in 2013 were the European Union (EU), the United States (US), and Member States of the Association of South East Asian Nations (ASEAN), Australia, China and Japan. Singapore’s volume of trade at regional level shows it is highest with Asia at 40.9% and lowest with Africa at 2.1%. For instance, while the volume of export of Singapore to Nigeria in 2013 stood at $212 million, exports from Nigeria to Singapore were only $5.4million.
In charting a way forward, it is worthy of note that President Muhammadu Buhari has already reassured the business and international community when he reaffirmed that “as a responsible government, we intend to continue to build a stable economy through prudent fiscal policies and providing favorable environment for both domestic and foreign investments. The aim is to guarantee growth and developments in all the sectors of our economy, cut waste, ensure fairness and equal opportunities”.
The Nigerian government will maintain a commitment to Implementation of Agreements, Create a Conducive Business Environment, Improve the Quality of Exports through Value Chain, Explore the Non- Oil Sector and change the Consumption Pattern of the Nigerian Economy.
The way forward for Economic and Trade Relations between Nigeria and Singapore had since been identified by no less a personality than the Former Governor of Lagos State Mr. Babatunde Raji Fashola when he received the High Commissioner of Singapore to Nigeria, His Excellency Mr. Shabbir Hassanbhai at his Lagos House Ikeja Office, in Nigeria.
He said and I quote: “The biggest impediment now probably, if that is the right word to use, is the very slow movement of Singaporean entrepreneurs outside their own shores. Leaving their shores and coming here will enable them to see the environment in which they expectedly want to invest”. He further said: “I think maybe if we begin to have this kind of fora in rotation, maybe host it in Africa one period and in Singapore another period, it will facilitate the crossing of channels and direct contact with the people and the place, rather than dealing with them on laptops and telephones”.
I hereby extend an invitation for you all to visit Nigeria and see for yourselves. In doing so however, I call on the government of Singapore to establish its High Commission in Nigeria and appoint a resident High Commissioner as doing so will be in the best interest of our trade relations.
Farouk presented this paper at the 2015 Nigeria and Singapore Business Forum in Singapore.