By Adesanya Alao
Blumberg Grain, a global investment firm has indicated plans to invest $250 million in grain storage in Nigeria.
Nigeria’s Minister of Finance and Coordinating Minister of the Economy, Dr. Ngozi Okonjo-Iweala who disclosed this in Washington DC at the on-going International Monetary Fund (IMF) and the World Bank Group meetings, said the firm is working with the Minister of Agriculture and had sent a team to the country.
She said, “They want to make Nigeria the hub for grain storage and cold storage in Africa for agriculture logistics, and they want to invest $250 million. They have their team, but the fact that we have the largest economy in Africa, is making them feel that this may be the place to make the hub.”
She said the World Bank and the IMF had agreed to create a Social Protection Programme to address the issue of growth and job creation for Nigeria and some other developing countries at the bottom end of the development ladder.
She said both development and funding bodies were putting together policies and suggestions on how more jobs can be created, and as well drive growth in this regard.
“We just announced our rebased Gross Domestic Products (GDP), and this was very favourably accepted and looked upon, particularly when the institutions themselves participated, especially in the quality control. The rebase is stronger, it was well received, it elicited a lot of interest among participants and also private sector people, who came to say they were interested in investing,” she said.
“The biggest focus about these meetings is looking at the global recovery, looking at a group of countries and what needs to be done for them to either strengthen their position and make sure that whatever the circumstance, they are able to prevail and come out with a strong economy.
“The other issue is that the recovery is on, but the one in the Euro-Zone is quite fragile. The reason for the fragility may be what looks to be an extended period of low inflation, and low inflation is not a good thing because that means that demands for goods and services is suppressed, and there’s even a fear of deflation, of fallen prices in Europe, as it happened in Japan.”
The implication, she argued, is that if these countries in Europe continue to suffer from a period of low pricing, internal demand for goods and services will be low, meaning that the rate of recovery for those economies will be either slower, or reversed.
To the Minister, of greater concern to Nigeria is the tapering that is taking place in the US, that has to do with the phasing out of liquidity which they are putting into the economy, which she cautioned has very serious implications for our economy and its impact on portfolio flows, as well as in our bonds in the Europe market.
She said the varied global economic developments place on Nigeria the need to continue to improve on its economic buffers, “because they are telling us, in the Euro-zone, they are not sure which direction it is going. In our case, that means we have to build our reserves, shore up our Excess Crude. We have to maintain very solid macro framework, because of our ties to the Euro-zone, in case something happens there. We are already doing that, we just need to emphasise that we must continue doing that.”