"Is Nigerian FTZ Strategy Working? 'Jury is out' " – Afolabi Elebiju, June 20081
"NEPZA has seen much development in the course of its existence, but it could have been better" - Engr. Terhemba Nongo, MD NEPZA, September 2019 2
Nigeria, in a bid to further improve her investment attractiveness propositions, formally joined the league of countries with export processing zone (EPZ) or free trade zone (FTZ) regimes in 1986, with the enactment of the Nigeria Export Processing Zones Act (NEPZ Act).3 Whilst the NEPZ Authority (NEPZA), established by section 2 NEPZ Act was only inaugurated in 1992, it took another nine years after NEPZA's inauguration before the first EPZ in Calabar commenced operations in November 2001.4 In 1996, the Oil & Gas Export Free Zone Act5 (OGEFZ Act) was enacted to cater for the oil and gas industry, with the OGEFZ Authority (OGEFZA) as the regulator whilst Onne/Ikpokiri in Rivers State was designated the inaugural OGEFZ.6
The regulatory regime of Nigerian FTZs and the appropriate legal tax regulatory treatment of transactions within and outside the Zones, have been well discussed elsewhere.7 This article focuses on the current state assessment of Nigerian FTZs, an evaluation of their historic (actual) versus projected contributions to the economy, vis a vis the regulatory energies expended in establishing and administering the FTZ regulatory framework. There are burning questions: Could there have been more progress in Nigeria's FTZ journey than we have had?8 How do we de-bottleneck the impediments to optimal FTZ contributions to national economic development?9 We discuss our findings and views on these issues, henceforth in this article.
Strides: Calabar, Onne OGEFZ and Lekki FTZ Case Studies
The Calabar FTZ (CFTZ), located in Cross River and occupying a land size of over 220 hectares, was established in November 2001 as the pioneer FTZ in Nigeria.10 It had reportedly attracted over 11,000 jobs to Cross River State as at May 2017 and hosts enterprises such as General Electric FZE.11 Bedevilled by infrastructural challenges since its start-up (discussed extensively in this article), NEPZA announced some "upgrade" of CFTZ in December 2019 "to make the zones attractive to investors and manufacturers."12
The Onne OGEFZ in Rivers State, was the first and only designated OGEFZ in Nigeria, and OGEFZA began regulatory operations in 2000.13 The OGEFZA has since licensed over 200 companies to operate in Onne, including reputable multinationals representing 45 nationalities, and supporting Nigerian upstream activities. According to Intels Nigeria Limited (Intels), "Onne Port Complex is the largest oil and gas free zone in the world."14 The Onne OGEFZ comprises two major terminals: Federal Ocean Terminal (FOT) and Federal Lighter Terminal (FLT).
In 2017, OGEFZ was reportedly adjudged by the Financial Times as the most successful African FTZ, in in terms of Foreign Direct Investment (FDI).15 According to OGEFZA, Intels, inspired by best practices in other jurisdictions such as the North Sea and the Gulf of Mexico, domesticated the concept of "one-stop oil service centre" that led to the integration and rationalization of the logistic requirements for import and supply of equipment for offshore exploration, development and production which also "maximised Nigerian Ports Authority's (NPA) revenue and control." The introduction of the concept of shared-facilities and services by all the major upstream and downstream companies drastically reduced their operational costs.16
The OGEFZA incorporated Freezone Global Investments Ltd in 2015 as it's "investment subsidiary" to engage with potential investors, promote investment opportunities in OGFZs and facilitate PPPs on behalf of OGEFZA in OGFZs, and maximize "OGFZA's potential as a vehicle for promoting accelerated growth and sustainable development."17 According to OGFZA, operators in the OGEFZ include the following:
Tenant Investors – these are approved enterprises engaged in the processing, refining /manufacturing of products in the oil or gas value-chain; or are service companies involved in or supporting oil and gas projects.18 Since the OGEFZA support the integration of oil and gas value chains (upstream and downstream), these Tenant Investors focus on the related opportunities and in that regard lease spaces/facilities provided by FTZ development companies.
Free Zone Developers - Investors may develop a greenfield/brownfield on a build, operate and transfer basis as a free zone for a concession period. They provide to the Tenant Investors infrastructure for rent or lease which may include: logistics and management services, stacking areas, warehouses, jetty facilities, and power generation plants.19
Intels Nigeria Limited: Portrait of an OGFZA Player
According to Intels, it started operation in Warri Old Port Complex in 1984; following a lull in activities in early 2000s, things picked up subsequently mainly due to the Escravos Gas-to-Liquid (EGTL) project.20 Intels chose Calabar as an operations base in 1989, and grew steadily from there: "... Calabar Port complex is a perfect support base for any activity in that region."21 Intel's history and investments in its flagship venture in Onne Port (which reportedly contributes about US$6.5 million annually into the Federal Government's coffers yearly, and generating over 10,000 jobs), and other proposed projects especially in the Lagos axis have been well documented.22 Recognising the potential role of Lagos State in the future development of deep water blocks in Western Nigeria, it collaborated with Eko Support Services Limited ((ESSL), which has a base at NPA's Apapa port) to enable service provision to clients in the Lagos area.23
The Lekki Free Zone Development Company (LFZDC) was established in May 2006 as a Joint Venture (JV) between: China-Africa Lekki Investment Limited (CALIL, itself owned by a consortium of Chinese companies) as the majority shareholder, the Lagos State Government (LASG) and Lekki Worldwide Investments Limited (LWIL). LFZDC was authorised by the NEPZA and LASG as the sole developer, operator, administrator and manager of the South/West Quadrant of the LFZ project.24
Part of its objectives include developing, operating and managing LFZ in accordance with global best practices, leveraging the advantages of Lagos as an important distribution hub in West Africa, thereby contributing to Nigeria's economic development whilst enhancing the economic cooperation between Nigeria and China.25 The LFZ is home amongst others, to the Dangote Refinery and the Alaro City.26 LFZ is also adjacent to the approved location for the proposed Lekki International Airport (LIA)27 and in close proximity to the deep sea port and a number of planned industrial developments.28 Export revenue at the LFZ is projected to hit over US$6 billion by 202029 while Dangote's investments alone in the LFZ is projected to generate N8 trillion turnover annually.30 In contrast, the entire FG budget for 2019 was N8.83 trillion (compared with N9.12 trillion and N8.61 trillion in in 2018 and 2017 respectively).31
FTZ and Local Content Development
Investment in local content or backward integration is critical to sustainable growth of any economy. Over the years, all the floating production, storage and offloading (FPSO) vessels operating in Nigeria's oil and gas industry were built and integrated in foreign shipyards, denying Nigeria the huge benefits of growing her gross domestic product (GDP) through in-country domiciliation of the huge expenditure, and local capacity development, as well as job creation.32
There are proposed developments to curb some of these challenges, such as the Tomaro Industrial Park, (TIP), 75 hectares of land between neigbouring FTZs Snake Island and Lagos Deep Offshore Logistics Base (LADOL)), and which was granted FTZ status in 2017. TIP, which is estimated at US$450 million includes a ship fabrication yard, a modular refinery, access slipway, oil storage tank farms, water treatment plant, power generation plant, container lay down /transit, and crude oil distillation unit.33
If consummated, TIP will be a welcome development compared to Heerema (a world leading ship builder and fabrication giant)'s pull out from Nigeria during President Jonathan's administration. Herema had attempted to invest in Nigeria; its Nigerian subsidiary had identified and secured a 19-year lease from the Nigerian Navy on Ogogoro Island, near Lagos to build a replica of its giant world-class Dutch shipyard in Nigeria.
However, the project did not materialise based in part on allegations of corruption and strong arm tactics by Nigerian public officials.34 The benefits that this project would have brought to Nigeria were huge in terms of direct and indirect jobs, local content compliance, technology transfer etc.
It seems Nigeria has learnt from its past mistakes. Recently, the Board praised the management of Dangote Petroleum Refinery and Petrochemical Free Trade Zone Enterprises (DPRP) in the LFTZ over its adherence to the local content law in the execution of its projects and declared its intention to further partner with the DPRP for effective implementation of the Local Content policy in the country.35
LADOL, on its part, has sought to protect local content in the LADOL FTZ. A prominent example was the action LADOL brought against Samsung for an alleged intention to renege on local content declarations in their successful joint bid for Egina FPSO integration and fabrication facility at LADOL FTZ in Lagos for Total Upstream Nigeria Limited.36 This is in line with its business model of enhancing local content capability for itself and other companies operating in Nigeria's oil and gas industry through the organisation of trainings and other workshops.
Disputes: FTZ Related Litigation
Disputes in FTZs in recent years can be categorized into: contractual/regulatory compliance and administrative disputes respectively.
For instance, under disputes in transactions and regulatory compliance, in Nigerdock Nigeria Plc-FZE v. FIRS37 the Tax Appeal Tribunal (TAT) held that "where an approved enterprise supplies goods and services to customers outside the zone but in the customs territory, the 'supply' is an operation and is a taxable activity because it is not within the zone. The income received on the supply shall be taxable pursuant to section 11 of NEPZA and Part 2 section 15(a) of NEPZ Authority Regulations and Operational Guidelines for Free Trade Zones in Nigeria. The installation service at the site amounts to supply of service outside the Free Trade Zone."
There are allegations that some FTZ operators/managers and enterprises engage in sharp practices that undermine government's efforts. Many times allegations and counter-allegations may be traded between operators and FTZ resident enterprises.38 The interests of FTZ operators like LADOL and FTZ enterprises may sometimes not align, leading to disputes, several ending up in court if parties are unable to agree. Such disputes must be well managed in order not to constitute an impediment to realisation of FTZ objectives.39 It is thus commendable that government through its various agencies tries to mediate such disputes in order to ensure that FTZ objectives are met.40
Gaps: Nigerian FTZ Regime Inadequacies
Arguably, there is still not enough publicity on the effectiveness of FTZs to attract more prospective investors. More can be done to publicise Nigerian FTZs to encourage investment. Whilst the NIPC's recent efforts as part of Nigeria's broad investment promotion efforts are noted,41 it does not appear that OGEFZA and NEPZA have been impactfully marketing the Nigerian FTZ regime globally. Recently, much of the headline information on Nigerian FTZs have been negatives: for instance, the near abandoned Tinapa project, FTZ related litigation between operators and approved enterprises, FG's running battles with Intels,42 or even sometimes friction between different FTZ operators over alleged breach of 'exclusivity', etc.43
This factor in addition to power shortages, infrastructure and logistics challenges make Nigerian FTZs not significantly attractive to investors. FTZ related disputes should be proactively managed in order to protect the integrity of FTZs as attractive investment propositions. Generally, disputes generate negative publicity, and could make prospective foreign investors cautious about investing in FTZs due to a perceived lack of strong governance/management culture.
Furthermore, a lack of data hinders proper evaluation of the FTZ regime. It is hard to measure the contributions of FTZs in Nigeria due to lack of reliable data on the performance of FTZs. The paucity of data constrains well informed economic decisions by potential investors want to know whether locating in an FTZ would suit their interests. Secondly, absence of data curtails government's ability to analyse the impact of its FTZ's regulatory strategy and leverage lessons therefrom on next steps.
The truth is that we learn a lot from successful zones, in particular, as they point to potentially scalable nationwide solutions. For example, in its transition to a market economy, China used its Shenzhen Special Economic Zone to test whether trade liberalisation would be a sound development strategy.44 Thus, until Nigeria takes data collection seriously, it would be impossible for us to know what we do not know about FTZs. Problems of inadequate or non-current data is in our view, an indictment on the effectiveness of NEPZA and OGEFZA's regulatory oversight.
For now, we can only scrutinise individual FTZs to elicit information on how to deal with FTZs, going forward. Although FTZs are supposed to be conducive to business growth, many of them still suffer from the infrastructural deficiencies that plague the rest of the country. For example, one of the most cited barriers to the growth of the CFTZ (Nigeria's pioneer FTZ), has been the lack of investment in dredging the Calabar port.45
Rather than tackle these challenges frontally, Nigeria's FTZ approach has so far been to rely on tax incentives to attract investors. The subsidies implied by these tax breaks are insufficient to overcome a fundamental lack of quality public infrastructure for most industries. And where the incentives have been 'successful', it is not immediately apparent that they were necessary to begin with.46
That the most active FTZs in Nigeria are oil-related (even if not all under the management of the OGEFZA) is telling, given the strategic importance and relative economic viability of the oil and gas industry. Therefore, it is possible that companies in these Zones would thrive even if they did not receive any incentives.
Road Ahead: Suggestions for Legislative & Policy Reforms
Currently there are thirty four (34) FTZs in Nigeria; twenty-one (21) inactive FTZs from which some are under construction, yet to commence development, sponsors yet to be committed, physical development of some are yet to commence. FTZs should be energetically monitored. The incidence of 'inactive FTZs' especially after reasonable timelines within which their operative status should have changed to active FTZs, is an anomaly that should not be tolerated.47
The World Bank reportedly advised that Nigeria adopt a single FTZ regulatory authority regime, in line with global best practices.48 Such unified regime also reduces administrative costs and streamlines operations, endangers long-term stability and the safety of investment which cumulatively lead to greater investor-confidence.49 In 2017, the National Assembly attempted to amend the OGEFZ Act by seeking to increase the regulatory coverage of the OGFEZA to other oil and gas EFZs. Those in support of the amendment pointed to the fact that the Onne OGEFZ since its establishment had contributed significantly to the economy.50 Were the same mechanisms be extending to other zones, there is a likelihood that the benefits would be significantly increased.
Unifying FTZ administration as suggested by the World Bank will entail legislative action, as it would mean collapsing two statutory bodies into one.51 An argument against could also be raised that these zones are sector specific and as such, different bodies with the necessary specializations are needed to make the most of the project. Abridgment deals with the present duplicity of powers and costs. However, necessary mechanisms must be in place to ensure there is no opportunity for impunity and mismanagement. Abridgment would also add more responsibility on the sole governing body which can create an equally greater impediment to the growth of the economy.52
Sub-optimal regulatory and administrative management of FTZs negatively impacts all stakeholders, including approved enterprises operating in the FTZs. If the current FTZ system is not yielding expected result, the single factory zones scheme operating in countries like Ghana and Kenya (African FTZ leaders with 192 and 160 FTZs respectively as at 2017), can be considered.53 The single factory zone operates where government confers export potential status to a company regardless of where the factory is sited within the country; factories do not have to locate within a designated zone to receive incentive and privileges.54 The now defunct Olokola LNG project and Brass LNG were planned as FTZs.55
Initiatives: The Project M.I.N.E (Made in Nigeria for Exports) Angle
Recently, Project M.I.N.E, an otherwise 'quiet' initiative was in the news as a result of the National Assembly querying its alleged funding without appropriation and other alleged due process infractions during the 2019 Budget defence of the Federal Ministry of Investment Trade and Industry (FMITI).56 The allegations and FMITI's well publicized rebuttal of same probably made significant section of the public aware of Project M.I.N.E.
Accordingly, Project M.I.N.E is a presidential initiative under FMITI's supervision to develop Special Economic Zones (SEZ) across Nigeria with the aim of boosting local manufacture of Nigerian goods for export. Approved by the Federal Executive Council (FEC) in June 2018, its target was to double Nigerian export manufacturing output to 20% of GDP by 2029. It planned to set up production hubs across the country in partnership with three development finance institutions: Afreximbank, Bank of Industry (BoI) and the Nigeria Sovereign Investment Authority (NSIA). 57 Shandong Ruyi, a Chinese textile conglomerate has reportedly announced its commitment to invest US$2 billion to the cotton, textile and garment industry for the SEZs to be put up in Abia, Kano and Lagos States.58
In line with the public-private partnership (PPP) model, a special purpose PPP entity – Nigeria Special Economic Zones Company Limited (NSEZCo) – was designed to enable institutional investors participate in Project MINE alongside the FGN, and to apply global best practices and processes to the long-term financing and development of SEZs. Apparently, members of the National Assembly Committee (comprising relevant committees of the Senate and the House of Representatives) opposed this transactional savvy arrangement as financial malpractice, alleging same involved usurpation of the powers of NEPZA.
The issue was referred to the Attorney General of the Federation (AGF) who in his directive ruled in favour of NSEZCo on the following basis:
"NSEZCO was not established to take over the functions of NEPZA as the mandates of both entities are distinct with little or no area of overlap; NSEZCO is set up to facilitate investments in SEZs. This does not touch on or derogate from the functions of NEPZA under the existing law. The relationship between NSEZCo and NEPZA is that of sector participant (albeit indirect) and sector regulator. NSEZCO is an investment vehicle and not a regulator while NEPZA is a regulator. The provisions in the Appropriation Acts of 2017 and 2018 were made for Project MINE and not for NEPZA but were domiciled in NEPZA at the specific request of the Honourable Minister of Industry, Trade & Investment. The transfer of Project MINE funds to NSEZCo is lawful and does not contravene the Appropriation Acts or the NEPZ Act, Therefore, the funds domiciled in NEPZA should be released to NSEZCO to enable her to utilise same for the Presidential initiative – Project MINE as approved by the Federal Executive Council."59
Issues like this affects investor confidence as in LADOL/SHI's case and should be managed properly. It is imperative the National Assembly is well informed, and understand policy initiatives they have oversight of before rushing to make wild allegations that could unnerve investors as well as potentially putting the country in bad light.
Studies of the SEZ models in Ethiopia, Kenya, Egypt, Gabon and Morocco show that the most sustainable approach to rapid and sustained SEZ development is the PPP model. The most compelling case study of this model was the Gabon SEZ Company, a PPP venture led by Olam (a multinational commodities and food group founded in Nigeria) as operator and manager, with the Government of Gabon and AFC as co-investors. Gabon SEZ has mobilised over US$400 million in shareholders' investment and attracted about 130 enterprises to set up operations there, creating tens of thousands of jobs.60
In our view, the Project M.I.N.E initiative can potentially leapfrog Nigeria's FTZ impact, with huge spill over effect for the overall economy, not just our manufacturing sector. It is a veritable prong in the quest to diversify Nigerian economy, whilst its PPP model will ensure accountability and efficiency – attributes that wholly driven public sector initiatives are not champions of. In its short existence, a lot of progress has already been made under Project M.I.N.E, with projects at various stages of development.61 Project M.I.N.E represents a laudable paradigm shift from the erstwhile "laid back, too little, too late" approach of FG in FTZ management;62 consequently, all hands should be on deck to ensure its success.63 Unfortunately, it appears that apart from the unhelpful distraction of unfounded allegations of fraud, the initiative itself has apparently lost tracion, especially after change of guards at the FMITI at the onset of President Buhari's second term. In our view it is a veritable prong that should be pursued with great passion, especially as government is a continuum and the ability to project stability should be a virtue.64
The common global practice is that sovereigns revisit their FTZ legislation every five (5) or ten (10) years.65 In our case, the NEPZ and OGEFZ Acts are both well over twenty (20) years old. Thus, the need to revisit both legislation cannot be overemphasized.
Analogy may be drawn with the pioneer status tax incentive scheme. For instance, section 11 Pioneer Status Incentive Regulations 2014 provides that: "The Commission shall carry out periodic impact assessment and evaluate the utilization of the savings accruing from the incentives to-(a) measure the effectiveness of the incentives; and (b) ensure that the savings accruing from the incentives are utilised for the intended purposes."66
It is paramount for the government to take stock of the progress of FTZs till date to ensure the regulatory framework is repositioned for optimality, and engender confidence of its ability to deliver for all stakeholders. Project management success is often determined by whether the project is operating within the original timeline/development status. Periodic quality reviews on FTZs would also determine the progress rate.67 Inter-agency cooperation, often touted by NEPZA/OGEFZA as part of their strengths was recently thrown into some doubt by allegations that the FIRS, opposed the grant of FTZ status to some applicants.68
Does continuation of the FTZ scheme provide the economy with the desired/anticipated growth to make a business case for the incentives being showered on entities operating within FTZs? According to the Holy Bible "to whom much is given, much is expected" (Luke 12:48). Is the government holding the short end of the stick, a la "the 30 coins paradox" where Judas 'sold' Jesus for only thirty pieces of silver.
Assuming he obtained a higher price, it was still a grossly unequal exchange: "what shall it profit a man if he gains the whole world and loses his soul? (Mark 8: 36). Unfortunately, Judas' 'seller's remorse' was too late; government cannot afford not to periodically review the cost benefit analysis of Nigeria's FTZ regime with a view to ensuring that it can positively answer the question: "are we giving too much in exchange for little?"
* The authors gratefully acknowledge the input of our former colleague, Ms. Ayooluwatunwase Fadeyi to the first draft of this article, but take full responsibility for all the views expressed herein.
1. Slide 40, 'Free Trade Zones & Nigeria Tax Regime', a June 2008 presentation by Afolabi Elebiju (referred to subsequently in this article).
2. NEPZA, 'Why Kano FZ Must Work Optimally', https://www.nepza.gov.ng/index.php/news/item/18-why-kano-fz-must-work-optimally-nepza-ag-md (accessed 04.04.2020).
3. Cap. N107, Laws of the Federation of Nigeria (LFN) 2004.
4. Nats Agbo, 'Understanding Nigeria's Free Trade Zone Scheme', The Guardian, 07.09.2016: https://guardian. ng/art/understanding-nigerias-free-trade-zone-scheme/ (accessed 25.04.2019).
5. Cap. O8, LFN 2004.
6. The President has the authority to designate an area as an EPZ on the recommendation of NEPZA: section 1 NEPZ Act; Rule 1, Investment Procedures, Regulations and Operational Guidelines for Free Zones in Nigeria 2004. Apparently, section 1 OGEFZ Act took the unusual step (rather than via subsidiary legislation), of designating Onne as the first OGEFZ.
7. See for example, Afolabi Elebiju, 'Free Trade Zones & Nigeria Tax Regime', CITN MPTP presentation, Ibadan, 25.06.08 ("CITN Presentation"): https://www.slideshare.net/slideshow/embed_code/key/Bkvn9hpIhdlsTY; and https://www. templars-law.com/wp-content/uploads/2015/05/citn_presentation. pdf; Frank Okeke and Ayo Fadeyi, 'Nigeria Free Trade Regime: Frequently Asked Questions (FAQs)': http://www.lelawlegal.com/ blog-details.php?title=nigeria-free-trade-zone-regime; and Uzeme Olomu-Agbodo, 'Free Trade Zones in Nigeria: Contentious and Burning Issues': https://www.academia.edu/16085453/ (all accessed 08.03.2019).
8. For example, NEPZA's list of 19 inactive FTZs, include some that had been designated an FTZ since 2000, but remarks thereunder about their status was that "physical dev. yet to commence". An example is Oluyole FTZ, Ibadan: https://www.nepza.gov.ng/index.php/free-zone/inactive-free-zones (accessed 04.04.2020).
9. Many of these questions are not new. In the CITN Presentation, Afolabi Elebiju raised the following posers inter alia in Slides 41, 42 and 46 under 'Counting the Cost': '30 Silver Coins' Paradox: has Government given away too much? Cf. NLNG Tax Incentives Act/NNDC Levy/Udoma Committee on Review of Concessions & Waivers; Preliminary issue: meaningful analysis difficult -absence of accurate, current data on monetary value of FTZ incentives since inception, vis a vis impact of FTZs on local and national economy; Difficult to see how NEPZA can perform duty (in s. 4(g)) – 'recommendation to the Federal Government of additional incentive measures for the Zones'-without scientific data to evaluative adequacy or otherwise of incentives; Internal and external studies are both necessary. NEPZA still largely "civil service", e.g. on access to information; Cf. Costa Rica: Cost-Benefit Analysis of the FTZ System: The Impact of FDI in Costa Rica(2005 Study –OAS Trade, Growth & Competitiveness Studies) done for Foreign Trade Corporation of Costa Rica; 'NEPZA News. THIS IS A TEST NEWSREEL INFORMATION MAY BE DATED': http://www.nepza.org/microNews/index.php; As at December 2007, the value of investments in Nigeria's pioneer EPZ was only $100 million. Cf.with another view that private sector investments reached $220m (as at 2004); After 1st private EPZ (Lekki), many major investors now seeking FTZ status for locations of their business, e.g. OKLNG, Brass LNG, AKLNG; How much have we seen in the so called 'four priority areas of development': i. Metallurgical/Engineering Industries, ii. Agriculture (Forest-based/agro-allied), iii. Chemical/Petrochemical Sector, [and] iv. Construction Sector[?]; Tax incentives–without them firms might not have come, but now that they have come...; Personal income taxes (PIT) payable by employees of approved enterprises –incentives apply to firms, not employees...; Employment of locals: concerns about Lekki EPZ ($267 million investment in 1st Phase, proposed 15 sq. km coverage & total investment of $5 billion). '...as with other announced Chinese projects in Africa, whether or not Nigeria will ever see a... FTZ in Lagos where 300,000 Nigerians are employed is a matter of speculation, if not skepticism. ... According to a Nigerian report, 'Chinese companies are notorious for their tendency to bring in their own workers as opposed to hiring locally. This policy does not in any way address issues of unemployment in the host nations. Safety standards within their industries are another area of concern'; OGEFZ–instability in Niger Delta a major inhibitor to goal of being service hub to entire Gulf of Guinea...; Infrastructure is always a major issue..."
10. See Abdulaziz Salisu, 'Diversifying the Economy through Export Processing Zones', Economic Confidential, 20.06.2017: https://economicconfidential.com/2017/06/export-processing-zone-economy/ (accessed 06.05. 2019).
11. It hosts "companies engaged in manufacturing, trading, provision of services and oil and gas related activities". See 'CFTZ Attracts 11,000 Jobs To Cross River – NEPZA Boss': https://www.nepza.gov.ng/index.php /news/item/3-cftz-attracts-11-000-jobs-to-cross-river-nepza-boss (accessed 04.04.2020).
12. See Francis Arinze Iloani, 'Kano, Calabar Free Trade Zone Almost Complete - NEPZA', Daily Trust, 26.12.2019: https://www.dailytrust.com.ng/kano-calabar-free-trade-zone-almost-complete-nepza.html (accessed 04.04. 2020). "...the Acting Managing Director of NEPZA, Engr. Terhemba Nongo, said the upgrade involved provision of internal road networks, water supply and electricity to make the zones attractive to investors and manufacturers." On another occasion, he stated: "But following the coming into office of President Muhammadu Buhari, things have been looking up. Before now, the most the Authority got in terms of budgetary receipts was N2billion! But under the incumbent President, specifically in 2017, for the first time in the history of NEPZA, the Authority received an unprecedented capital injection of N50billion – although only N20.5 billion was released. The same figure was again allocated to us in 2018. And from the budget estimates, we are expecting the same in this 2019. Consequently, there has been a corresponding spike in the activities in the Public Zones in Calabar and Kano, especially in terms of infrastructural development or renewal i.e. water, power, roads etc. By the time we are through, these public Zones would have world-class amenities or infrastructure; and invertors operating there too, who have issues with water or power, would heave a sigh of relief. And world-class investors would, therefore, be attracted to the Zones, and this, in leaps and bounds." See NEPZA, 'Why Kano FZ Must Work Optimally', https://www.nepza.gov.ng/index.php/news/item/18-why-kano-fz-must-work-optimally-nepza-ag-md (accessed 04.04.2020). Also, according to former MD NEPZA, Emmanuel Jime, "Recognising the need to boost the activities of NEPZA, the administration decided to increase the authority's budgetary allocation to N50bn ($161.6m), with this sum projected to increase to roughly N100bn ($323.3m) in 2020. Free zones are expected to have the kind of infrastructure that cannot be found elsewhere in the country. Nigeria has an infrastructure deficit at the moment. Power, water and even a functioning road network are not guaranteed nationwide. The decision has been made to empower free zones to create oases of great infrastructure. The idea is to develop these particular platforms to a level where they can compete with other such zones based around the world. We plan to follow the examples set by Ireland, the UAE and China." (Emphasis supplied). See 'On Using Free Zones as Cornerstones of Economic Growth', (interview with Oxford Business Group), 11.02.2019: https://oxfordbusinessgroup.com/views/emmanuel-jime-managing-director-nigeria-export-processing-zones-authority-nepza (accessed 04.04.2020).
13. Cf. OGFZA statement on its website: "The first oil and gas export free zone to be established in the country was the Onne Oil and Gas Free Zone in Rivers State. Subsequently other oil and gas free zones were established as public-private partnerships between the Federal Government of Nigeria and private sector operators." See OGFZA, 'OGFZA History': https://www.ogfza.gov.ng/index.php/company-overview/company-history/ (accessed 15.05.2019). OGFZA listed "Existing Zones Under OGFZA" as: (1) OGFZ Onne/Ikpokiri, Rivers State (Operating); (2) OGFZ, Warri Port Complex, Delta State (Operating); (3) OGFZ, Eko Support Lagos Operating; and (4) Brass Oil & Gas City, Brass Island (BOG), Bayelsa State. See: OGFZA, 'Presentation on the Oil & Gas Free Zones Authority Nigeria' (undated), Slide 4: http://fzgil.org/wp-content/uploads/2017/09/The-Oil-Gas-Free-Zones-Authority.pdf (accessed 20.05.2019).
14. Intels, 'Onne Port Complex': http://www.intelservices.com/onne-port-complex (accessed 20.05.2019). Intels further states, "All of the major industry players are operating from Onne, supporting the exploration and production of Nigerian activities. Under-used and partially built, Intels Nigeria Limited refurbished it from 1982 until 1995, when the first ocean vessel moored at FOTs (Federal Ocean Terminal) Berth No. 1. This became the only berth for deep offshore support."
15. OGEFZA, 'Oil and Gas Free Zone Onne': https://www.ogfza.gov.ng/ index.php/free-zones/onne/ (accessed 15.04.2019). Cf. with concerns expressed in 2008: "OGEFZ–instability in Niger Delta a major inhibitor to goal of being service hub to entire Gulf of Guinea. Cf. with Equatorial Guinea's Bioko–likelihood of overshadowing Onne as a major oil and gas hub. In tandem with unfortunate trend whereby Angola is now leading African oil producer." See Afolabi Elebiju, CITN Presentation (supra), Slide 46.
16. See OGFZA, 'OGFZA History': https://www.ogfza.gov.ng/index.php/company-overview/company-history/ (accessed 15.05.2019). In 1988, Nicotes Nigeria Limited, the predecessor (affiliate) of Intels obtained an initial five-year lease from NPA to operate NPA's facilities at Onne Port Complex (OPC), Warri Old Port (WOP) and Calabar New Port (CNP), as part of the process of stepping up the logistic support for the oil and gas industry. The three ports, which were previously underutilised, became strategic locations for the creation of integrated transit and supply bases and optimal oil service centres. In 1992, to meet the need for large and long-term investments required to boost the sector, Nicotes applied for and was granted a 21-year extension of its leases at the OPC, WOP and CNP. These were part of the leases taken over by Intels, and eventually consolidated into a single lease document between NPA and Intels in 2005, (the Consolidate d Lease). In 1992, in response to FG's invitation to the maritime industry to participate in the needed investment to complete the development of the FOT, Intels brought in significant investment to complete the FOT. It subsequently injected additional investments in infrastructure, including the development of approximately 100,000 square metres stacking area and the refurbishment of warehouses and the partially completed quay apron, allowing the first vessels to be berthed at FOT in 1995. According to Intels, "all of the major industry players are operating from Onne, supporting the exploration and production (E&P) activities in Nigeria's oil industry, with over 200 companies in the OGEFZA."
18. Typical services provided by Tenant Investors include: one-stop- shop stevedoring, terminal and supply base operations, stockists, pipe coating, machine shops, fabrication yards, environmental services, dry/liquid bulk, yard/dry dock, boat companies, shipping lines and vessel operators, airfreight operators, terminal operators, clearing and forwarding, oilfield transit & supply services, heavy lift transport companies, drilling contractors, cementing service, drilling fluid services, wellhead & subsea equipment, fabrication & engineering, information technologies & security systems, and banking services. See OGFZA, 'Free Zone Tenant Investors': http://fzgil.org/?page_id=141 (accessed 15.04.2019).
22. See for example, Sulaimon Salau, 'INTELS: Indelible Footprints Spurs $7b Investment, Economic Growth', The Guardian, 04.12.2017: https://guardian.ng/business-services/money/intels-indelible-footprints-spurs-7b-investment-economic-growth/(accessed 15.04.2019). For example, apart from its Onne Port facility, its Onne Estate comprises 971 units of residential accommodation over 50 acres near the Onne Port complex in the OGEFZ: http://www.intelservices.com/onne-estate (accessed 15.04.2019). Free Zone. According to the earlier report, "Intels is now embarking on other multi-billion dollar projects in Lagos, which include; the Badagry Deep seaport and Industrial Park Free Zone, Eko Atlantic Economic City, Eko Energy Estate, Eko Support Services, and Lekki International Airport and a host of others."
23. The collaboration resulted in redevelopment of the EESL base (also a free zone facility), which was completed in May 2014, becoming "the only dedicated Oil and Gas facility in Lagos offering both port services and shore base services" providing logistic solutions: http://www.intelservices.com/lagos-port-complex (accessed 15.04.2019). For further details about ESSL's services/operations, visit: https:// ekosupportservices.com/ (accessed 15.04.2019).
24. LFTZ is located in the South Eastern corner of Lagos State, facing the Atlantic Ocean to the south, and the Lekki Lagoon to the north. See LFTZ Investment Brochure: https://www.eiseverywhere.com/file_uploads/ 4c89fc4ccf7b9b01305474f571ba12b3_LFZ_InvestmentGuide.pdf. (accessed 15.04.2019).
26. The Dangote Refinery costing around US$12 billion is expected to produce 65.4 million litres of petrol, diesel, aviation fuel and kerosene daily. It will enhance Nigeria's the ranking of as a major contributor to global refining capacity when it comes on stream in 2020. See Udeme Akpan, '$12bn Dangote Refinery Enhances Nigeria's Ranking' Vanguard Newspaper, 26.02.2019: https://www.vanguardngr.com/2019/02/12bn-dangote-refinery-enhances-nigerias-ranking/ (accessed 25.04.2019). This massive project is the largest industrial complex in Nigerian history and scheduled to be completed by 2021 (originally 2020). See Dangote Group Website, https://www.dangote.com/our-businesses/ (accessed 15.05.2019). The refinery site covers an area of 2,635 hectares in the LFZ near the Lekki Lagoon. The location will enable easy shipment of refined petroleum products to the international markets. Additional benefits of the project is that the gas from the pipeline system could generate 12,000MW electricity for the nation. There are also has plans to construct a 570 MW power plant within refinery complex. See also Roseline Okere, 'Dangote Deep-Sea Pipeline to Boost Nigeria's Power Generation by 12,000MW', The Guardian, 14.06.2018: https://guardian.ng/business-services/dangote-deep-sea-pipeline-to-boost-nigerias-power-generation-by-12000mw/ (accessed 15.05.2019). Alaro City is a joint venture between Rendeavour and LASG. See Rendeavour, 'Project Profile': https://www.rendeavour.com/projects/ lagos/ (accessed 25.04.2019).
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