Positive
developments have occurred in Nigeria since May 1999 when democracy replaces
the spate of military government. This has resulted in a number of spirited move
to attract investors-local and foreign –into the country. The president,
Olusegun Obasanjo I. a bid to achieve this end, embark on a globe trotting that
saw him interacting with other fellow presidents and the business communities
of different countries.
With a more relaxed taxing system, incentives and the
creation of Nigeria investment promotion commission (NIPC). The country was set
to lure private sector finance. As a first step, the government took a bold
move to privatize all the ailing public enterprise; decree No.25 of July 1996
backs this scheme. The government set up Bureau of
public enterprises (BPE) to oversee the crucial venture and the national
council on privatization (NCP) headed by the vice-president to formulate
pragmatic polices in this area.
INCENTIVES AND OPERATING CONDITIONS
Most of the empirical evidence supports that notion
that specific incentives such as lower taxes have no major impact on FDI.
Particularly when they are seen as compensation for continuing comparative
disadvantages. On the other hand, removing restrictions and proving good
business operating condition are generally to have good positive effects. In
China, the open-door policy and enhanced incentives for investing in special
economic zones contributed to initial influx of FDI. Further incentives, such
as the granting of equal treatment to foreign inventors in relation to local
counterparts and the opening up of new markets (e.g. air transport, retailing
and banking) have been reported as important factors in encouraging FDI in
recent years.
the Indian government has recently
relaxed most of the regulations regarding foreign investment. This is seen as
contributing to the increased FDI flows in the last couple of years. However,
the lack of transparency in investment approval procedure and an extensive
bureaucratic.
System are still deferring foreign
investors, hence relatively FDI/ GNP ratio. In 1991, Bangladesh and Pakistan
implemented reforms allowing foreign investors to operate with 100 0/0 ownership
but still failed to attract significant flow (as a proportion of GNP) because
of political instability and an over-extended bureaucracy. Nigeria in contract
continue to attract foreign investment as an oil exporting country despite its
erratic and relatively in hospitable polices. With regard to the remaining low
income countries. With small FDI inflows, survey indicates that lack of
clear-cut policy with respect to foreign investment and excessive delays in the
approval procedures are among the important deterrents. Although, a number of
African countries set up one-stop investment shops during the 1980 in order to
simplify approval procedure, the increased work roads created bottlenecks.