Market News

BY  Oluwakemi Abimbola

The United States Ambassador to Nigeria, Richard Mills Jr, has said that the US will be focusing on private sector-led investment instead of aid in its engagement with Nigeria and sub-Saharan Africa.

Mills Jr said this on Thursday at the Fireside Chat held at the Lagos Business School under the theme ‘Toward a Robust US-Nigeria Commercial and Investment Partnership.’

Nigeria is the US’s second-largest trade partner in Africa, with bilateral trade hitting about $13bn at the end of 2024.

He said, “Over the last few decades, the United States has invested billions of dollars in Nigeria’s health, education, and agricultural sectors, I believe, saving lives and also creating new economic opportunities on the ground. However, we have reached what President (Donald) Trump likes to call an inflexion point. Now is the time for us both to build on the strength of these aid investments, and for Nigeria, one of Africa’s largest economies with huge economic potential, to enter a new phase of vibrant private sector-led growth. Our approach, I want to be clear, I think, is three.

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“We are making a shift from aid to trade. We want to engage African nations not as aid recipients, but as capable commercial partners. For us, as our chief of African Affairs, Ambassador Latrell, said, going forward, we will continue to invest in development, but we will do so through expanding trade and private investment, because it is the private sector, not assistance, ultimately, that drives the final stage of economic growth. By promoting two-way trade and investment, we believe we can drive mutual growth for both our nations. So, as the US Ambassador to Nigeria, I’ve been given a key priority for my mandate to increase trade, increase investment, and increase business linkages between our two countries.”

To achieve this goal,  Mills Jr stated that last year, the US Department of Commerce, working together with Nigeria’s Ministry of Industry, Trade and Investment, signed a commercial and investment partnership agreement.

“The CIP is a five-year memorandum of understanding in which we prioritise with the Nigerian government three key pillars: agriculture, the digital economy, and infrastructure. I should point out that Nigeria is only one of five African nations with which the US has signed the CIP agreement. We are officially launching the partnership discussions later this month,” he stated.

He explained that both governments have agreed to establish working groups in agriculture, tech, and infrastructure. The ambassador also commended the current administration for its listening ears and reforms.

“I want to commend the current leadership in Nigeria, both at the federal level and at many of the state levels. They listen to us when we come in and say, ‘This has been identified to us as a serious issue for US businesses,’ and I think that’s really important to put out — that we do have some listening, really listening, happening. I also want to say, I think the American business community — the US Mission — feels that we’ve seen some significant economic reforms in the last several years that have really improved the macroeconomic possibilities here,” he said.

Mills Jr admitted that the reforms being done by the government were hard on Nigerians, but he was optimistic that the reforms would yield positive outcomes.

He said, “I know they’ve been painful for a lot of Nigerians, but I do believe our assessment is that they will begin, hopefully, to have these green shoots grow into even more opportunities. We’ve also seen tax reform move forward, which again has been a big concern for US businesses.

“One US business told me that their operations in Nigeria, for instance, paid 67 different federal taxes — including a tax on wheelbarrows — which is some leftover from a different age. So the tax reform bill is very important. So those kinds of macroeconomic reforms — that’s what we wanted to see, what US businesses wanted to see.”

He, however, noted that electric power distribution and transmission capacity is still a serious blockage for a lot of US firms in Nigeria, “especially in the tech sector, which is very interested in taking advantage of Lagos and the country’s incredible talent in the tech field.”

He noted that the power sector is a top concern for both investors and citizens, adding that through the Power Africa and related programmes, the US is supporting smaller-scale, off-grid energy solutions that can bypass some of the systemic challenges with the national grid.