The Lekki Free Zone Development Company (LFZDC) sponsored the Nigeria-South Africa Chamber of Commerce breakfast meeting held at Iris Hall, Eko Hotel & Suites, Adetokumbo Ademola Street, Victoria Island, Lagos on Thursday, 25th of May 2023.
The breakfast theme, “Leveraging on the Free Zone Scheme as a Catalyst for Nigerian Economic Growth. The Lekki Free Zone Story” was aimed at exploring the potential of free zones in promoting economic growth and development in Nigeria and South Africa.
The panellists comprise Mr. Prem Krishna (GM Power & Gas, Lagos Free Zone), Mr. Yomi Ademola (MD Alaro City FZC), Mr. Adebanjo Otukomaya, Controller, LFZDC ; Mr. Yann Magarian (CEO Lekki Free Port Terminal), Mrs. Bolatito Ajibode (DMD Lekki Free Zone Dev ) and Dr. Tunde Sodade (MD Lekki Worldwide Investments Limited). And they all unanimously agreed that the Free Trade Zone will not only promote economic growth but it will also encourage and allow small business owners to grow.
The event highlighted the importance of free zones in promoting economic growth and development. According to the Deputy Managing Director of LFZDC, Mrs. Bolatito Ajibode, free zones provide a conducive environment for businesses to thrive by providing them with access to infrastructure, tax incentives, and other benefits. She also noted that free zones can catalyze economic growth by attracting foreign investment and promoting exports.
The event also featured a panel discussion on the challenges and opportunities of free zones. The panellists discussed issues such as infrastructure development, regulatory framework, and the need for collaboration between the public and private sectors, as they encourage SMEs.
The Nigeria-South Africa Chamber of Commerce event sponsored by LFZDC was a step in the right direction towards promoting economic growth and development through free zones.
Free zones are designated areas within a country where businesses can operate with little or no restrictions. These zones are usually established to attract foreign investment, promote exports, and create employment opportunities. In Nigeria, the Lekki Free Zone is one such zones, established to promote economic growth and development.
In 2021, Lekki was ranked as one of the fastest growing inner cities in Africa, both in terms of investments in infrastructure and population growth.
Dr. Tunde Sotade, the Chief Executive Officer of Lekki Worldwide noted that the firm was keen to partner with the Lekki Free Zone as it is the largest and most developed Free Zone in Nigeria with proximity to the Deep-Sea port as well as the Dangote refinery,
“Trading has been the bedrock of the Nigerian economy, with annual volumes running into billions of dollars. We believe the digitization of the sector can allow us to harness its full potential. For instance, a standard process to digitize goods manufactured or processed within the zone in tandem with a market system on web3 will allow manufacturers to trade globally via the blockchain, he said.
“All trades will be registered and benefit from the incentives of the Lekki Free Zone, such as zero taxation and free circulation of goods. As soon as the goods get settled for export by the in-Zone Customs Processing Center, they will get shipped out straight from the Lekki Free Zone via the Deep-Sea port.
This would reduce delays, eliminate human errors, exponentially drive-up Nigeria’s non-oil exports and sustain a positive trade balance for the nation. While we are still working out the fine details and a specific framework with NEPZA, we believe it is the future of commerce and trade in Africa”.
He explained that the partnership, when finalized, would create a dashboard for the tokenization of goods and provide digital asset-backed loans for new and existing enterprises who are looking to fund operations and/or expand their businesses, similar to the integration of OpenSea and Compound. He shared his vision for innovating the trading and industrial sector in Nigeria and Africa as a whole, bringing it into the modern information age with the Lekki Free Zone at the epicenter.
“I am extremely excited and motivated by the endless possibilities and enormous potentials of such a partnership, it would further establish Lagos State as Africa’s leading sub-national in terms of innovation and industrial development.
The Lekki Free Zone, created in 2006 as a modern free zone and managed in accordance with international best practices, is now a major hub of industrial activities.
It is a region where a group of countries has agreed to reduce or eliminate trade barriers, the basic objective being to enhance foreign exchange earnings, develop export-oriented industries and generate employment opportunities for the host country.
Currently, the Lekki Free Zone, located on 16,500 hectares of land is divided into four quadrants and managed by various operators, benefiting from Lagos State’s position as the premier distribution hub in West Africa.
It covers a total area of about 155 square kilometers in the Ibeju Lekki local government area, South-East of Lagos, Nigeria, about 50 km from the city center.
The zone boasts of both local and foreign investments running into billions of dollars, amongst which are the largest oil refinery in Africa and a fertiliser plant.
Others are the petrochemical plant, a sub-sea gas pipeline project under construction and the largest deep-sea port in West Africa, primed to open up access for export to West Africa and beyond.
Lekki’s free trade zone has provided an ideal platform to open up diverse markets for all investors and enterprises in the world. It is already a unique landmark of the future development of Lagos state and Nigeria as a whole.
The profitable collaboration is a major catalyst for the development of Lagos state brought about by a collaboration of the Chinese and Nigerian governments.
Though, the first private free trade zone in Nigeria and the biggest in West Africa.
This zone has been designed to become a new Lagos and has been granted a series of preferential policies and incentives, and designated as a special economic zone inside Nigeria.
The zone attracts investors due to its great transportation plans, by land, sea and air, with its unique geographical and regional advantages, the zone serves as the best platform for investors and enterprises who desire to open up to markets all over Africa, Europe, and the USA.
Mr. Prem Krishna (GM Power & Gas, Lagos Free Zone) added that Energy cost is the lowest in Nigeria. He further described the zone as the preferred investment destination in Nigeria, urging Dutch investors to take advantage of the unique opportunities and incentives available.
According to him, the zone has several investment-friendly incentives meant to attract investors and enable them thrive while doing business in Nigeria. He noted that with the integration of Lekki Deep Sea Port, which had commenced commercial operations in April 2023, the Zone is set to become a catalyst for Nigeria’s economic prosperity.
He explained further that the Zone, which covers an area of 850 hectares of land, has a self-sustainable business ecosystem that includes warehouses, standard factories, a logistics hub, a fire station, broadband network connectivity, residential developments, a medical facility, solid waste management, and an independent natural gas-based power source.
“There are a lot of competitive business advantages you can get in locating your business in the zone. We have a wide range of facilities and enabling infrastructure that would make your business thrive and guarantee huge returns. There are a lot of fiscal and non-fiscal incentives available for investors who want to do their business within the Zone. These incentives include single-window clearance for regulators, the opportunity to live-work-play, cost-effective and reliable power solution, access to global markets and tax exemptions,” he said.
According to the World Bank report, Lekki free trade zone is the fastest free zone in the world.
There are several multi-billion dollars investments driven by various Chinese companies that have been commissioned
With massive job opportunities, the zone project alone is expected to churn out 300,000 direct jobs and 800,000 indirect jobs.
With the recently commissioned of Lekki deep sea port and the construction of the new international airport, the Dangote refinery, pan Atlantic university, Eleganza industrial city, the proposed 4th mainland bridge, and other amazing infrastructure, it is obvious that an investment in the land around Ibeju-Lekki will reap massive returns a few years to come
Currently, the zone is under the management of the Lekki free zone development company.
Recently, Yomi Ademola, Managing Director, Alaro City described the Lekki Free Trade Zone (FTZ) quadrant as Nigeria’s new economic powerhouse, explaining that it harbours $25 billion worth of investments.
The concept of the free trade zone had revolutionised the development of the Lekki axis of Lagos once upon a time considered an undeveloped peninsular.
He noted that the government’s effort in trying to diversify the economy resulted in the development of the Lekki Quadrant, which, according to him, would undoubtedly become the country’s new economic powerhouse.
Interestingly, many Nigerians and foreign investors are particularly enthused with the conversion of the peninsular to a majestic business city.
Another feature that makes the Lekki Free Zone appealing is the integrated seaport’s transhipment capabilities.
Also, Yann Magarian, Chief Executive Officer, Lekki Freeport Terminal noted that Lekki will be a transhipment hub, but it might be in the future if West Africa requires it. The draft is 16.5 meters, and the capacity of phase one is 1.2 million twenty-foot equivalent units (TEUs).
With seven ship-to-shore cranes and a draft that allows larger boats to dock, the Lekki Seaport will be able to handle 100 movements per hour when completed, which, although not amazing by world standards, is light years ahead of what is currently being done at Apapa and Tin Can Island. It will transform Lekki into a 21st-century port.
Experts predict that once the free trade zone and Lekki seaport are operating at full capacity, the Ibeju Lekki axis would see an increase in trade volume of about $25 billion by 2030.
It is then not a surprise to see why real estate investors are buying land all over Ibeju Lekki. Refusing to purchase land in Ibeju Lekki while it is still available for as little as 1.2 million for a complete plot might be your worst mistake.