30 May 2016, Lagos – Investments in the Oil and Gas Free Zones across the country hit N14.8 trillion as at March, 2016, with Integrated Logistics Limited leading with an investment of more than N10 trillion.
Managing Director of Oil and Gas Free Zones Authority, Mr. Victor Alabo, who disclosed this to Vangaurd, said players in the oil and gas industry had committed over N14. 8 trillion value of investments since the creation of the free zones ten years ago.
Alabo, the Oil and Gas Free Trade Zones boss, said that the investments had added value to the Nigerian economy, noting that more of such investments were expected before the end of the year. The authority boss also said that the oil and Gas free Trade Zones formed a core investment area of government. Alabo also disclosed that about 60 per cent of Foreign Direct Investment came into the country in the last ten years through the oil and gas free trade zones.
He said Oil and Gas Free zone at Onne, Rivers State had been adjudged as the most developed in the world, stressing that this was due to the consistency of government policies and ingenuity that had been brought into the management of free zones.
There are currently six oil and gas free zones in the country namely, Onne, being the biggest, Lagos Deep Offshore Logistics, LADOL, Base in Lagos, Eko support Service in Apapa port, Brass oil and gas free zone in Brass, Rivers State, and one in Warri, Delta State.
He disclosed that government had provided a lot of incentives to investors in the free zones, adding that some of them were physical incentives and others were tax incentives. Alabo further disclosed that these incentives had been a major attraction to investors in the free zones.
The authority helmsman also said that in the Free Zones, companies were exempted from withholding tax, company tax, adding that some government agencies were beginning to take withholding tax and other forms of taxes from firms operating in these zones, an indication of policy somersault.
He further disclosed that the Free Zone authority had taken up the issue with the relevant ministries. He stated that these were free zones under the regulations of the Oil and Gas Free Zone Authority, adding that some of such zones were created before the OGFZA was established and were not regulated by the authority.
The other free zones not being regulated by OGFZA, are currently being regulated by the Nigerian Export Processing Zone Authority, NEPZA, Alabo added. He said: “Government has provided lots of incentives, some are physical incentives, some are tax incentives and these have attracted investors into the free zones.
“Government must ensure that they are consistent with these incentives and if there is policy somersault, investors lose confidence in bringing in their fund.
“As long as this confidence is established, it attracts many other investors coming into the zone and that is why we have about 200 investors in this zone.”
Continuing, he said: “In the free zones, there are no expartrate quota, an investor can come with any number of foreigners to work for them.”
The second incentive, according to Alabo, is that operators in the free zone can repatriate their profit hundred per cent to their own country as there was no limitation.
Explaining further, Alabo said when these investments were set up, the Free Authority negotiated with them on how Nigerians could be trained and take over these jobs over time.