Doing Business in Kwara State

Kwara State welcomes investors with a comprehensive set of policies and guidelines

Kwara State offers many opportunities for investors in a wide range of sectors. To facilitate such investment, the administration of Kwara State has developed a comprehensive set of policies and guidelines. These outline the principles upon which the investment regime of the state is founded and give specific guidance as to what assistance will be rendered to prospective investors. Kwara State is eager to welcome new investors, and has already done much to smooth the way for new projects to be started.

Industrialisation is a way of achieving meaningful economic growth, social progress and general development. The numerous contributions that industrialisation can make to the overall development of a nation have caused the Kwara State Government to regard it as a priority. The government is also aware that the state has much to do to achieve a sufficient level of industrial development. Consequently, it has introduced a number of measures and policies which are aimed at transforming the state from an essentially consumer state to an industrialised one. These policies are:

 

Industrial policy

The policy objective of the Kwara State Government is to ensure the rapid industrialization of the state through the provision of a virile industrial base. The government aims to achieve this through:

  • Promoting massive tourism, industrial, commercial and cooperative activities especially through the encouragement of private-sector initiatives.
  • Encouraging local/foreign, private/public capital investments in all spheres of tourism, industry and commerce, especially those related to the resource endowment of Kwara State. This would be done through direct state participation or the creation of a favourable atmosphere for their operations.
  • Encouraging the development of indigenous technology, especially through the use of adaptive and/or copy technology.
  • Promoting the establishment of small-scale industries and cooperative projects, especially those that are agro-based. This is to further stimulate industrial growth in the rural areas while at the same time bringing about the expansion of the agricultural sector, particularly through Farmers’ Cooperative Societies.
  • Vigorously promoting the development of export-oriented industries and programmes to generate foreign exchange that could be used to bring about the expansion of the industrial and commercial sectors to further generate new employment opportunities.
  • Promoting commercial enterprise generally and providing an efficient distribution network for all cooperative and commercial activities. Developing the state’s tourism potential.
  • Promoting the development of the service industry (repairs and maintenance) and those companies supplying components and parts.

Investor guidelines

The appropriate authorities

  • The Bureau of Lands and Physical Development demarcates appropriate areas in various towns or Local Government Areas (LGAs) in the state as layouts for commercial use or as industrial estates. Within this bureau, there is an Industrial/Commercial Plot Allocation Unit.
  • The Ministry of Commerce, Industry and Cooperatives is adequately informed of decisions pertaining to the demarcation of industrial estates so that such information can be disseminated to interested investors. All three of these bodies work hand-in-hand for quick allocation of plots to interested investors.
  • The Ministry of Commerce, Industry and Cooperatives has studies on raw materials available in the state for interested investors.

Queries

  • All inquiries on industrial or commercial ventures must be made to the Ministry of Commerce, Industry and Cooperatives.
  • The Bureau of Lands and Physical Development offers the necessary forms for industrial plot application to the investor. A copy of this form is kept with the Ministry of Commerce, Industry and Cooperatives for its records.

Allocation of plots

All plot allocations (industrial or commercial) are made by the Bureau of Lands with the Ministry of Commerce, Industry and Cooperatives in attendance. The Ministry of Commerce is officially notified in writing of all such plot allocations made by the Bureau of Lands.

Challenges and forfeits’

An investor who is dissatisfied with the size or location of a plot allocated to him/her informs the Bureau of Lands. The Bureau in turn will inform the Ministry of Commerce, Industry and Cooperatives of the complaint and the necessary actions being taken. An investor who is allocated an industrial/commercial plot and who fails to develop his plot within one year of such allocation automatically forfeits his/her allocation.

Industrial incentives

Apart from setting priorities in its investment promotion efforts, the state government has introduced a package of incentives to prospective investors. These incentives will assist the industrialist in taking the right decision with respect to the choice of location of his industry in the state. These incentives include:

  • Provision of in fro structure: The Government has provided industrial and commercial layouts/estates that are fully serviced with the necessary infrastructure in all Local Government Areas: access roads, water supply, electricity and drainage. Where telephone facilities are available in a town, telephone lines will be extended to the layouts/estates therein.
  • Plot allocation: Industrial and commercial plots will be allocated promptly on approval of the project.
  • Certificate of Occupancy (CoO): Certificate of Occupancy will be issued within 30 days of agreement by all the parties involved in the processing.
  • Joint financing of project: Joint financing by government agencies is guaranteed subject to their independent assessment of the project.
  • Rebate on ground rent: Rebate is granted on ground rent and other fees to reduce the financial burden on investors.
  • Raw material data: An in-depth survey of the available raw-material potential of Kwara State is obtainable from the Raw Materials Research and Development Council (RMRDC] at a token fee.

Existing Investors in Kwara State

A number of private-sector companies have successfully invested in Kwara

Kwara State has become an investment destination of choice-with a whole variety of commercial and industrial enterprises choosing to set up new businesses in the thriving state. The investment-friendly policies of the state government, coupled to Kwara strategic position, plentiful natural resources and well-educated workforce, are contributory factors in persuading entrepreneurs and corporations to set up their enterprises in the state.

In recent times, a number of companies have chosen Kwara as the place to build their brands and grow their businesses.

The Dangote Flour Mills

The Dangote Group is one of the largest corporations in Nigeria. It is a diversified group with an historical emphasis on foodstuffs and agri-processing. Cement production, logistics and real estate are some of the other areas that the multi-billion-naira company now operates in, but it remains one of West Africa’s biggest processors of agricultural goods.

Dangote operates five flour and semolina mills in different locations through-out the Republic of Nigeria. Annual production of flour is approximately 1.6 million metric tonnes.

The flour mill operation in Kwara is wholly owned by the Dangote Group of Companies. The mill, located along Asa Dam Road, was established in 2003, and the factory went into full production in July 2006. The major product is flour with spaghetti and macaroni also being made on site. The installed capacity is 27 trailer-loads of finished product every day. Up to 30 trailer-loads of wheat are needed as feedstock on a daily basis.

The feedstock is sourced from within the drier parts of Kwara State where wheat is cultivated and from other regions in the northern parts of Nigeria.

Dangote Flour Mill employs about 450 workers which indicates that the company is performing well. Demand for the flour produced by the mill is high and sales figures have been very positive in recent years.

Kwara State Government provided incentives and a generally conducive environment to investment when Dangote made the decision to invest. The chief reasons cited by the company for the original decision to locate its plant in Kwara were:

  • Nearness to raw materials
  • Conducive enabling environment
  • Government support and encouragement
  • Provision of adequate infrastructure such as land, water, good roads and electricity
  • Availability of market for the finished products.

Olam Nigeria

Olam Nigeria Ltd has a significant presence in Kwara State and constitutes an important partner in the state’s drive towards industrialization and food self-sufficiency. Olam Nigeria is a subsidiary of the Singapore based Olam International, an agricultural products and food ingredients multinational with 8000 employees in 56 countries. Through the Olam Company, Kwara is connected to a distribution network of more than 4000 customers in 60 markets around the world.

In Kwara, Olam has established a cashew-processing plant at Ogbondoroko which produces exclusively for the export market. At least 5000 local farmers are involved in harvesting the raw product, which the company then purchases for beneficiation.

Plans to increase rice production in Kwara and Nigeria received a big boost with the opening of Olam’s 40,000.metric-tonne capacity rice processing factory at patigi in late 2009.

Olam declared that it wanted to produce more than 20 000 metric tonnes of rice per year by 2010, from its facilities scattered throughout Nigeria.

The Federal Government of Nigeria has a stated aim of making the country self sufficient in the production of rice and the establishment of rice-processing factories is clearly an important part of that process. The federal government has a Rice Intervention Fund Scheme and Kwara State is one of the chosen sites for the roll-out of this programme.

Tuyil Pharmaceutical

Tuyi Pharmaceutical Company

Tuyil Pharmaceutical is a major company in the pharmaceutical sector, with a presence in all parts of Nigeria. The decision of Tuyil to begin production in Kwara has extra significance, given the importance of pharmaceutical production in the national economy. The federal government is very aware that Nigeria’s pharmaceutical industry is relatively small and the installed capacity only caters for about 50.75% of the nation’s drug needs. The country is still largely dependent on the importation of drugs. As a result, a ban on the importation of a number of drugs has been instituted in order to stimulate local production.

The raw material requirements of the sector can be classified into heavy and fine chemicals. While the heavy chemicals are mainly mineral and petrochemical-based, most of the fine chemicals are agri-related and Kwara State has many of the relevant resources.

Tuyil Pharmaceutical decided to locate a manufacturing plant in Kwara State because of the peaceful environment and infrastructural advantages such as a good road network and adequate supplies of water and electricity.

Business Monitor International believes that signs for private-sector involvement in African healthcare are very good after the World Bank’s International Finance Corporation (IFC) unveiled a US$l-billion support package for the development of private healthcare on the continent. Although Nigeria is introducing a national health insurance scheme, BMI suggests that the increasingly popular concept of health savings accounts (HSAs) could provide a solution for many millions of Nigerians, particularly those employed in the informal economic sector.

An aspect of Tuyil’s corporate social investment was revealed in 2009 when it donated a building for the use of the secretariat of the Association of Resident Doctors in Ilorin.

For more information, click: http://www.kwarappp.gov.ng/