Dons Eze
ENUGU SHINES AT UK BUSINESS FORUM
The investment horizon looks green for Enugu State, South East Nigeria as the Coal City State has recently become a preferred destination for big businesses.
In a rapidly changing global finance and economy where sustainability and technology are the cornerstones of economic growth, findings show that the state is now a formidable force in two critical sectors: the green economy and information technology (IT).
Enugu State Governor, Dr Peter Mbah since assumption of office has not prevaricated over his administration’s resolve to make the state’s economy private-sector driven.
In May this year, the government published on its website detailed strategic steps to achieve a robust 500 per cent growth in the state’s economic-financial valuation over the next 7 years. This ambition has naturally widened the eyebrows of economists and financial consultants.
Since assuming office, the governor has implemented and upheld a vast array of policies which has played key roles in weathering the financial storms of the state.
Although the state’s current budget surged by over 130 per cent compared to the previous year, the governor established a 20 billion Naira Security Trust Fund which aimed at providing direct funding to armed forces to maintain stability in the state. This security trust fund became a bedrock for the present thriving economy of the state.
The bold efforts of the present administration in the state came to the fore at the Black-Owned Businesses Annual Seminar in Manchester, United Kingdom.
In a paper he presented at the high-profile gathering of global business leaders, Chukwudera Attama, a financial analyst and chattered management consultant, declared that Enugu has become a tax safe haven for foreign investors, MSMEs, FinTech and Tech startups with the dawn of new stable governance.
He noted that the rapidly growing population of the state has provided investors and local businesses with a market of consumers as well.
He said: “Currently, Enugu is growing at 0.27 per cent monthly populace growth which is an incredible resource for thriving industrialization, divergent talents, and investors’ haven. Leveraging its rich natural resources and expanding tech ecosystem, this southeastern Nigerian State is positioning itself as a leading player in renewable energy and a burgeoning technology hub in West Africa.
“Enugu State in the past year has enhanced her reputation for prime Real Estates according to the World Bank records, the state further stands as the first in ranking for ICT and Fintech development according to the Nigeria Council of Communications and Technology making her a prime geolocation of global energy and IT companies.
“With over 90 per cent literacy rate, the well-structured policies and targeted investments in smart education, Enugu is not only shaping its own economic trajectory for investors but also setting a benchmark for subnational entities across Nigeria and the African continent at large by fostering a robust investment climate and forward-thinking initiatives, Enugu State is spearheading a regional transformation that holds promise for driving Nigeria’s competitive edge in the global economy.”
Attama’s presentation critically evaluated Enugu State’s performance in its pursuit of leadership in the green economy and information technology (IT) sectors, employing a rigorous framework based on four key performance criteria: strategic relevance, criterion deficiency, criterion contamination, and reliability.
According to the financial expert, until the coming of Mbah as governor on May 29, 2023, the state had witnessed an uncontrollable decline in her Global Credit Rating (GCR) which was reflected in the GCR rating in 2021 as “B-unstable.”
However, recently the GCR rated Enugu as BBB-(NG) long-term and A3(NG) short-term with a stable outlook in May 2024 which comes at a time when Nigerian sub-national entities are grappling with economic pressures, ranging from inflationary challenges to debt sustainability.
This GCR rating has sparked the eyes of foreign investors who are hoping to capitalise on the newfound policy-derived financial stability of Enugu.
Also, for investors, the state’s disciplined approach to debt management, tax exemptions, PPP opportunities, and revenue generation, especially through Internally Generated Revenue (IGR), offers a favourable environment for both local and international investments.
To further illustrate the credibility of the GCR rating to the world, it is worthy to note that the current Enugu budget is approximately 79% of the total budget to capital expenditures which reflects Enugu’s commitment to long-term economic sustainability.
Additionally, the governor exhibited fiscal discipline and his economic management capacities by allocating over 63% of the current budget to critical investments in areas like education (₦134.6 billion), infrastructure development (₦82.5 billion), and agriculture (₦25.1 billion). These investments are top-tier choices for achieving a 0% poverty index in the state.
On the other hand, known for its vast coal reserves, the state is now pivoting towards renewable energy, aligning itself with global sustainability and financial goals. Since the passing of the Electricity Act of 2023 which empowers states to regulate and drive energy production and distribution within their jurisdictions, Enugu State’s leadership in the green economy is a cornerstone of its broader economic transformation.
A notable highlight is the incredible 50MW solar power project and ongoing natural gas development with plans to generate 690 MW of power by 2030, which aims to diversify the state’s energy mix to CNGs and other natural gas to aid reduce reliance on traditional fossil fuels and advancements in the green economy.
Attama continued: “To put the financial practical perspective, let’s look at the forecast future of green energy. According to the International Energy Agency (IEA), investment in renewable energy will reach approximately $2 trillion annually by 2030 and with over $35 trillion in assets under management globally, Environmental, Social, and Governance (ESG) factors are increasingly influencing investment decisions, with a strong focus on sustainability.
“With the MSCI Global Alternative Energy Index has outperformed traditional energy indices over the past five years and Enugu State’s strategic position in the market, it is clear that Enugu is a pathway of economic blossom of $4.4 billion GDP to a robust $13.5 billion GDP forecast in just 2 years apart.”
Enugu’s ambitions do not stop at renewable energy; the state is also positioning itself as a burgeoning technology hub within West Africa. The state’s investment in R&D digital infrastructure and its growing tech ecosystem are key drivers of this transformation.
Enugu is emerging as a technology hub in West Africa, with the state government committed to transforming the region into a digital innovation centre.
Enugu’s strategic location, skilled workforce, and burgeoning tech ecosystem have laid the foundation for this vision. With over 60% mobile penetration and a literacy rate of 90%, the state is well-positioned to leverage digital technologies for economic growth.
The state’s emphasis on ICT and innovation is genuinely aligned with Nigeria’s broader push for technology-driven growth, as it capitalizes on the African Continental Free Trade Area (AfCFTA) to access regional and international markets which is on the rapid rise.
The state’s Smart City Project, a project focused on decongestion of city centre areas to give rise to model infrastructures, reduce the carbon footprint and push towards digitalization, are laying the foundation for a robust tech ecosystem.
This is a world-class project currently bringing more credibility to Enugu State as we have seen the likes of this project in London, New York, Silicon Valley and many other tech cities in the world and how the city structure plays a key role in the financial booming of the state.
Enugu will be the next hub of global tech companies and a key player in data management in West Africa.
It is estimated that using this investment index published by the Enugu government, Enugu can achieve $30 billion GDP come 2029.
Attama did not end at extolling the government’s creative efforts, he also made valuable suggestions for further upscale the state’s economy.
“I commend the state to open more of the airspace of Enugu State to the international corridors, lead introduction of private air hangers for international cargoes and flights at key points of the state to reduce logistics cost of products/raw materials within the intercontinental level and heighten the state’s rising consumption power by 36% annually,” he said.
He finally stated that the State’s budget and capital expenditure met the four key performance criteria in strategic relevance, criterion deficiency, criterion contamination, and reliability.
“The dual focus on green economy and digital innovation is reshaping its economic landscape and positioning it as a key player in Nigeria’s future. As the state leverages its abundant natural resources, tech-savvy workforce, and investor-friendly policies, it is not only addressing the challenges of today but also preparing for the demands of tomorrow’s Africa,” Attama opined.
