jigawa state investor's handbook

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JIGAWA STATEINVESTORS HANDBOOK | 2013

A GUIDE TO BUSINESS AND INVESTMENT IN JIGAWA STATE

Prepared Under the Auspices of Ministry of Commerce, Jigawa State

March, 2013

JIGAWAInvesting Today to Secure Tomorrow

ContentsFOREWORD BY THE GOVERNOR 1

QUICK FACTS 3

INVESTING IN NIGERIAAn Overview of the Nigerian Economy 8Overview of the Jigawa Economy 11

JIGAWA STATE INVESTMENT POLICY 13Strategic Policy Focus 13A Sense of the Business & Investment Climate 14

NATIONAL INVESTMENT LEGISLATION ANDREGULATION FRAMEWORKS 16Nigerian Investment Promotion Commission Act 16Foreign Exchange Act 17Corporate Taxation 18Transaction Taxes 18Personal Income Tax 19Visas and Entry of Foreign Workers 20Business Visas 20Work and Residence Permits 20Starting a Business n Jigawa 22Investment Incentives in Nigeria 23

SECTORAL INVESTMENT OPPORTUNITIES IN JIGAWA 26Dutse and Investment Opportunities 27Agriculture Sector 29Real Estate Development 34 Power Sector 36Commerce and Industry 38Export Processing Zones 38The Maigatari Export Processing Zone 39Other Policies for the Promotion of Commerce 40Solid Minerals 42Tourism Development 44ICT and Galaxy ITT in Jigawa 47

KEY CONTACTS 49

This Investor Handbook provides a broad overview of Jigawa State to facilitate understanding of its vast resource potentials among interested private investors. It outlines the policy and regulatory environment as well as the incentive regime we have created in support of both local and foreign investors when doing business in the State.

Our vision for Jigawa is to build a broad-based, dynamic and competitive economy that ensures the prosperity and well-being of its citizens and secures the future of its children. Given its varied natural resource, its

potential for real and sustained growth is not in doubt. Jigawa has in the last seven years developed a conducive and progressive regulatory environment for business and was appropriately rated by WB DB Reports as a strong performer in terms of regulatory procedures. Our State ranks not only best in Nigeria, but also competes well globally. Jigawa has good road infrastructure that will improve enterprises ability to access regional markets in northern Nigeria, and is investing in the development of an airport. Low levels of crime give Jigawa an edge over other

FOREWORD by His Excellency, the Governor

His ExcellencyAlhaji (Dr.) Sule Lamido CON

Governor, Jigawa State

Foreword by the Governor | 1

JIGAWA STATE INVESTORS HANDBOOK | 2013

States in the Country. Above all we have over the years developed a reputation for good governance and demonstrated the political will to carry out far reaching economic and institutional reforms to reposition our State.

We are not oblivious of the formidable constraints and challenges in attracting domestic and foreign investment. Jigawa is acutely affected by Nigerias business environment constraints including electricity shortages, limited access to and high cost of investable funds. Although many of these are outside the States ability to address, we shall remain committed to policies and programmes that create an enabling space for private sector development.

We believe that our prosperity depends on the extent to which private individuals as well as private enterprises drive economic growth and continuously create wealth more abundantly. As a government our role will remain that of facilitators in sharp contrast with the philosophy of previous governments that had sought to promote development through direct investment in industrial enterprises.

The recent privatization of State-run Birnin Kudu Dairy Processing Plant, Kazaure Tomato and Citrus Processing Factory, Gumel Flour Mill, the Rice Milling Plant and Sugar Processing factory at Hadejia is a demonstration of Government's commitment to facilitate private sector development in the state.

Re f o r m s i n g o v e r n a n c e a n d strengthening of institutions that guarantee the protect ion o f investments and human rights will continue in earnest. We remain ever ready to engage and collaborate with new partners and expand all frontiers in our relationship with the existing ones. We are open and supportive to any ideas and investment in any of our economic sectors for our mutual benefit.

While we continue in our stride toward lasting improvement of the lives of the people of Jigawa State, we call on all potential partners and investors to join and share with us this new opportunity of prosperity that Jigawa State offers.

His ExcellencyAlhaji (Dr.) Sule Lamido CONGovernor, Jigawa StateMay 2013

Foreword by the Governor | 2


DEVELOPMENT ISSUES

Vision:

Mission:

Strategic Development Objective:

'to be a secure and just society full of opportunities, where the people are sufficiently empowered to participate in decisions and processes that affect their lives with an enabling environment for sustainable growth and development'

to provide a sustainable and socio-economically developed state through exemplary and transparent leadership, provision of social service through strong and functional institutions, and the development of physical infrastructure based on broad participation by the people'

pursuit of pro-poor economic growth strategies which will put the state on the track of achieving MDGs

GENERAL

?Created on Tuesday, 27 August, 1991

The 'New World' is bordered by Kano and Katsina States to the west, Bauchi State to the east and Yobe State to the northeast.

To the north, the State shares an international border with the Republic of Niger, providing unique opportunities for cross border and international trade.

Jigawa State comprises of 27 Local Government Councils divided into 30 State Constituencies, 11 Federal Constituencies and 3 Senatorial Districts.

Jigawa has a five-emirate structure: Hadejia, Gumel, Kazaure, Dutse and Ringim Emirates each headed by an Emir. The Emirates comprise of

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JIGAWA STATE:Quick Facts

Jigawa State Quick Facts | 3


Districts (headed by District Heads or Hakimi), Villages (headed by Village Head or Dagaci) and Wards (headed by Ward Head or Mai Unguwa)

The State Capital Dutse acts as the central commercial, administrative and residential hub of the state

Jigawa is 8th most populous State in the Federation with an estimated

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POPULATION DYNAMICS

population of 4,361,002 [2006 population census] of which 50.4% is male and 49.6% female

There is a young agile population in Jigawa State: almost 50% of population are of economically active ages [15-59 years], 42.2% are below 15 years and only 8.8% are above 60 years

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ECONOMY

?Jigawa State ranks as the 10th largest non-oil and gas economy in Nigeria with a Gross State Product of N759,120 billion

?It is a key constituent of the Northern Nigeria economy and society being the 5th most populous and 7th largest in terms of Gross State Product.

?Economy dr iven la rge ly by agriculture: it is 7th largest crop producer in Nigeria with value of crops estimated at N644.41 billion.

?Crops cultivation including millet, s o r g h u m , c o w p e a , b e a n s , groundnuts, sesame, rice, maize, sweet potatoes, Bambara nuts, water melon, cassava, cotton, okra, Roselle and water melon

?For a number of agricultural produce such as sesame, rice, gum Arabic, and wheat, Jigawa State is ranked among the top three in the nation

?The State has a total landmass of almost 25,000 square kilometres: 80% is certified as arable and cultivated during the short raining season. Nearly 14% solely composed of irrigable wet lands suitable for all-year-round agriculture. Currently there are approx. 54,000 hectares put under irrigation

?Commerce and Industry consist of small and medium scale agro-enterprises dealing in agricultural produce, livestock, food and beverages and other household consumer goods: Value of whole sale and retail trade approximately N8 billion

?Informal sector strong and diverse: 80-90% of output and employment emanating from the sector. Jigawa has the third highest employment of i n f o r m a l s e c t o r w o r k e r s [approximately 3.3 m] after Kano [3.5m] and Rivers [3.3]. More than

50% [1,637,237] of the informal sector workers are women.

?Jigawa state has deposits of over ten different kinds of solid minerals in commercial quantities, including: gold, tantalite, columbite, kaolin, feldspar, clay, mica, quartzite, limestone, trona and silica sand. The State's potential for solid minerals a n d r a r e e a r t h e l e m e n t s deve lopment has not been exploited.

?A border free zone was licensed in 2000 by NEPZA and is envisaged to cover a total of 6.5 square kilometers with robust and modern infrastructures to support and sustain light, medium and heavy manufacturing industries targeting the export market.

?Industry is mostly limited to small and medium scale agro-enterprises that deal in agricultural produce, livestock, fisheries, food and beverages. Other informal sector activities include blacksmithing, leatherworks, tailoring services, auto repairs, metal works, carpentry, tanning and block making.

?Tourism is a small and developing sector in Jigawa but there are a number of sites with tourism potential. The foremost site is the Baturiya Birds Sanctuary, which is home to 378 migratory birds and is proposed for a UNESCO World Heritage site. Other potential sites areWawan Rafi Lake in Kazaure and ancient rock paintings in Birnin Kudu. Dutse is also home to the Royal Gold Course and planned botanical gardens.

?Rate of unemployment is estimated



at 28.6% compared to a national a ve rage o f 2 1 . 1% . Fema le unemployment rate is high at 42.2% [national average 24.9%]. Male unemployment rate is 18.8% [national average 17.7%]

?68.7% household heads are self-emp l o yed , 7 0% r e l y i n g on subsistence agriculture as main occupation

?The distribution of people engaged in some economic activ ity: [1,535,660] is

?Jigawa has a conducive and progressive regulatory environment for business which has been recognized by the World Bank in the 2010 Doing Business performance indicators:

?Simplified land administration system: it is fairly easy for investors to acquire a Certificate of Occupancy (title) for land and obtain building permits [days to deal with construction permits: 47, with a global ranking of 6/183, compared to Nigeria overall of 350 days and 167/183 rank; number of procedural



steps to deal with construction permits: 10, with a global ranking of 9/183. Nigeria ranks 101/183]

?J i g a w a h a s m o d e r n r o a d infrastructure that will improve firms' ability to access regional markets in northern Nigeria, and is investing in the development of an airport. There are over 2000 km of tarred road traversing all of state. While there is roads linkages with all neighboring states, virtually all the 27 Local Governments Headquarters and several other small towns are well-connected by high-quality all-season road networks.

?The construction of a modern airport suitable for both cargo and passenger t ransportat ion i s underway, due to be completed in 2013.

?A railway track from Kano passes through the State to Nguru in Yobe State cutting through seven Local Government Areas

RankWorld Bank ease of Doing Business

2010 1 Jigawa 2 Gombe

7 Katsina8 Kano

24 Lagos

?Internet connectivity powered by Galaxy ITT via a broadband network also provides enormous potentials for effective communication and information management which are essential for both public and private sector operations.

?Public water supply in the state is excellent with over 90% access to safe drinking water. Surface and Underground Water is similarly excellent.

?Main source of revenues: the Federation Account [Statutory Allocation plus VAT proceeds]. Internally Generated Revenues constitute less than 10% of recurrent revenue.

FINANCIAL RESOURCES

BUDGET Estimates: Jigawa has developed a reputation for realistic budgets

Indicative Resource Allocation: Top 5 Sectors



Over view of theNigerian Economy

Nigeria is one of the fastest growing economies in the world, averaging 7% for the past 10 years. It is Africa's third largest economy [GDP US$ 238.9 billion] after South Africa [GDP US$ 390.9 billion] and Egypt [GDP US$ 252.5 billion] and accounts for at least 40% of West Africa region's GDP. Currently 40th largest economy in global ranking, with vision to be among the 20 biggest economies in the world by 2020.

Nigeria is Africas most populous nation, estimated at 170 million (2012 CIA World Factbook) with about 2.8% annual growth. It constitutes about half of West Africa's and 2% of world population. Over 75% of the population is under 35 years; more than 50% are 18 years and below. This implies the

Youthfulness of Nigerias population with huge potentials for market, labour supply, vigour and skills.

Nigeria is a dual economy a traditional agricultural economy where about 70% of the population belong with GDP contribution of 40%, overlaid by a modern segment dependent on oil revenues. The country has approximately 30 million ha of arable land-land, nearly 40% of its land area, 12 million ha of fresh water sources, a 900 Km coastline and significant ecological diversity which enables the country to produce a variety of crops, livestock, forestry and fisheries products. Cash crops include cocoa, rubber, sesame, coffee, cotton and palm kernels. Subsistence crops include sorghum, maize, cassava, yams, millet, rice, etc. Leather, cocoa, sesame and some rubber products are being exported.

INVESTING IN NIGERIA


Investing in Nigeria | 8

Livestock farming of cattle and small ruminants is important, and poultry farming is rapidly increasing. Grains like rice and corn, and cassava and palm plantations, sometimes owned by, o r i n pa r tne r sh ip w i th , multinational corporations, are gaining ground in producing raw materials for company use (e.g. grain for breweries, raw skins for tanneries).

A recovering though still weak industrial sector which contributed only 4.8% of the countrys GDP in 1998 and employed just 8 % of the workforce. Presently emphasis is shifted towards more low-cost, integrated, h igh va lue-added industries which rely on local rather than imported raw materials and capital goods, and on shifting production away from Lagos. Leather, beverages, text i les , cigarettes, food processing and soaps continue to account for over 60 % of total manufacturing output. Industry has benefited lately from stable exchange rates. Reforms toward improving the business and investment climate hold a lot of promise in filling the existing performance gap and benefitting from the huge West African market in which Nigeria predominates.

Historically one of the largest producers of tin in the world in the 1950s and 60s, with production based around the highland district of Jos. Production collapsed from an average of 10,000 tonnes per year in the 1970s to 300 tonnes by 1995 and even lower as of date. Deposits of uranium, lead, zinc, tungsten and gold are not yet exploited. Solid minera ls inc lud ing gems and precious stones are reported to be abundant but equally unexploited.

There are 65 sites in Nigeria where gold has been located. By mid-1999, field appraisals had recommended nine as being ready for exploitation.

The petroleum sector is the m a i n s t a y o f t h e e c o n o m y, contributing 36% to annual GDP, 75% to government revenues and accounting for virtually all foreign exchange earnings. Nigeria ranks as the sixth largest producer in the Organization of Petroleum Exporting Countries (OPEC) and by far the largest in Africa. Proven and probable reserves of natural gas stood at 3.5 trillion cu metres (124 trillion cu feet) as at end-1998. The US$4bn Nigeria Liquefied Natural Gas Scheme, Africa's single biggest eng ineer ing p ro jec t , s ta r ted producing liquefied natural gas at the plant at Bonny Island, near Port Harcourt, in 1999. Civil unrest in the Niger Delta region interrupted production for a while, but it has now resumed following an Amnesty Agreement between Government and the restive youths of the region.

Attempts at diversifying the economy are still ongoing through several national development plans, starting with the First National Development Plan (NDP) 1962 1968; then the Second NDP 1970 1974; then the Third NDP 1975 1980; and the Fourth NDP 1981 1985. Despite these plans, structural distortions largely predicated by government domination of the economy were experienced. To address these, a Structural Adjustment Programme (SAP) was introduced in 1986. SAP was to restructure and diversify the

Fiscal Policy and Reform

Investing in Nigeria | 9


productive base of the economy in order to lessen its dependence on the oil sector and on imports, to achieve fiscal and balance of payments viability over time, lay the basis for sustainable non oil sector with minimum inflationary growth among others. Three-year rolling plans were also introduced starting in 1990 1995 and subsequently to 1998 under guided economic de-regulation and exchange-rate management.

With the return of civil rule in 1999, the two-tier exchange rate system was abolished and a bill was passed to pave the way for the privatization of major utilities as prelude to many other major reforms. The first was a 5-year comprehensive economic strategy the National Economic Empowerment and Development Strategy (NEEDS) covering 2003 - 2007. As a home-grown strategy, the objectives of NEEDS included wealth creation, employment generation, poverty reduction and value re-orientation. These goals were to be ach ieved through four key s t r a t e g i e s , n a m e l y ; G o o d governance through public sector r e f o r m a n d i n s t i t u t i o n s strengthening, creating resilient and compet i t ive pr ivate sector, economic empowerment and technical support to the small and med ium s i zed en te rp r i s e s , mainstreaming the informal sector by easing the processes and procedures of establishing and operating formal businesses.

The adoption of NEEDS produced some improvement in some key economic indicators like external debt profile, improved non-oil exports, a more market-based economy, etc. Early results of NEEDS

encouraged the quick adoption of its state and local government counterparts in the forms of SEEDS and LEEDS respect ive ly. In furtherance to a market-oriented economy, NEEDS inspired the Nigeria Vision 20:2020 which was developed for the transformation of the Nigerian economy to the status of 20th best economy of the world by the year 2020. This is being implemented through medium term National Implementation Plans (NIPs) the first of which is spanning th rough 2010 2013 . The Transformation Agenda has also been developed for the implementation of the Federal governments economic agenda 2011 2015. Outcomes from the implementation of the 1st NIP and the Transformation Agenda so far include improved sectoral performance(s) based on better domestic business environment resulting from improved policy formulation, implementation and coord inat ion ; bet te r f i s ca l management and discipline using budgeta ry benchmark s and Sovereign Wealth Fund (SWF); enhanced local content and participation in public and corporate procurement; etc.



Jigawa State is the 10th largest non-oil and gas economy in Nigeria with an estimated Gross State Product of N759.120 billion. The most prominent feature of the economy is the dominance of agriculture and other informal sector activities including agricultural produce & livestock merchandize, small and micro business enterprises, wholesale and retail and other artisanal trades. According to official estimates the agricultural sector contributes the bulk of GSP and engages directly and indirectly more than 70% of the population. Crop production is the dominant agricultural activity and Jigawa State is Nigerias 7th largest crop producer.

Major rain fed crops grown in Jigawa State include millet, sorghum, cowpea, groundnuts, sesame, rice, maize,

Sweet potatoes, Bambara nuts, water melon, cassava and cotton with a combined annual yield in excess of 2 million MT. Dry season crops cultivated are tomatoes, pepper, onions, wheat, sugarcane, carrots, cabbage, lettuce, maize and a host of other leafy vegetables.

Many farmers also engage in rearing of livestock. Popular livestock species in the state include goats, sheep, poultry and cattle with estimated populations of 2.3 million, 1.8 million, 4.2 million and 1.1 million respectively (JARDA 1993/94 LSR).

Out of the 2.24 million hectares total land area of the State, about 1.6 million hectares are estimated to be cultivatable during the rainy season while about 308,000 hectares of the land mass is cultivable during the dry season through irrigation. Based on this, over 80% of the States total

THEJIGAWAECONOMY

The Jigawa Economy

The Jigawa Economy | 11


landmass is considered arable, which makes it one of the most agriculturally endowed States in Nigeria.

The modern industrial sector is still at an infant stage. The attempt to fast track industrial development in the State led to the establishment of three agro-allied Industries in the mid-1990s. These are Dairy Processing Plant at B/Kudu, Tomato and Citrus Processing Plant at Kazaure and Flour Mill at Hadejia. These were established through a joint venture partnership with Hungarian Technical Partners. B e i n g p i o n e e r i n d u s t r i a l establishments, it was expected that these industries would lay the foundation for industrial development in the state. The attempt was not successful.

The Export Processing Zone (EPZ) at the border town of Maigatari presents h u g e o p p o r t u n i t i e s f o r t h e development of small- and medium-scale enterprises and cross-border trade in all goods including light manufactures and value-added agricultural commodities. Licensed in 2000 by NEPZA, the EPZ is envisaged to cover a total of 6.5 square kilometers with robust and modern infrastructures to support and sustain both light, medium and heavy manufacturing industries targeting the export market.

The informal sector is vibrant and diverse, with an estimated 600 businesses across all economic activities, engaging more than 3 million people and contributing approximately 70-80% of output. The dominant economic activities are agro-allied: including grains and food processing, livestock merchandizing, tanning & leather works. Other informal sector activities include blacksmithing, tailoring services, auto repairs, metal

works, carpentry, dyeing, masonry, quarrying and block-making,

Jigawa has a vibrant domestic trade sector which is predominantly informal, consisting of thousands of subsistence enterprises but with huge contributions to the state economy. In addition to the hundreds of regular markets spread across towns and villages in the state, Jigawa has a number of specialized markets at SARA, GUJUNGU, MAIGATARI, KUPSA and HADEJIA dealing in large scale agricultural commodities and livestock merchandizing. Jigawa has links with Niger Republic which provides opportunities for cross border trade.The formal wholesale and retail trade sector remains largely untapped.

The State has an attractive Business and Investment Climate in terms, e spec i a l l y, o f t he r equ i s i t e i n f r a s t r u c t u r e f o r e c o n o m i c development such as roads, electricity, and information and communication technology. There are over 2000 km of tarred road traversing all the nooks and crannies of the state. This improves firms access to neighboring states in the north of Nigeria. A railway track from Kano passes through the State to Nguru in Yobe State, making Jigawa a key link between the Northwest and Northeast of Nigeria. Internet connectivity powered by Galaxy ITT via a broadband network also provides enormous potentials for effective communication and information management which are essential for both public and private sector operations.

The Jigawa Economy | 12


Generally, the Government is pursuing pro-poor economic growth policies in which also there is an overarching concern for providing a favourable business and investment climate for p r i v a t e s e c t o r d e v e l o p m e n t particularly small and medium scale enterprises. In line with states comparat ive and compet i t ive advantage in the agricultural sector, the strategy involves the promotion of small and medium scale enterprises that has strong linkage with the agricultural sector. This also includes the promotion of production and distribution of goods and services through Small and Medium Scale Enterprises and development of Cooperatives & Entrepreneurship. This is viewed as viable option for the gradual industrialization of the state with huge potentials for jobs and Wealth creation. Other specific strategies include:

?Establishment of an Export Processing Zone for the promotion of cross-border trade;

?Development of skilled and semi-skilled labor through the skills acquisition centers;

?Pr o m o t i o n o f t r a d e - b a s e d cooperative groups;

?Financial intermediation Services to facilitate access to credit

?Provision of incentives for private sector participation in the industrial development of the State. These include, among others, provision of free industrial plots, exemption of all land development charges and other tax concessions, preparation of industrial profiles and feasibility studies, etc;

?Promotion of Research and Development;

JIGAWA STATEINVESTMENT POLICY

1- Strategic Policy Focus

Jigawa State Investment Policy | 13


2 - A Sense of the Business & Investment Climate

One of the main findings of the World Banks Doing Business in Nigeria 2010 Report was that it is " easiest to start and operate a business in Jigawa" compared to all the other 36 States in Nigeria.

Since the 2010 Doing Business in Nigeria Report, the State has continued to take conscious and proactive measures in continuously improving the business environment and investment climate in the state. While on the one hand, physical infrastructure was developed t o s u p p o r t s o c i o e c o n o m i c transformation, on the other hand, g o v e r n a n c e p r o c e s s e s w e r e continuously reformed to facilitate the establishment and growth of private investments on whatever scale. Already the liberalised business

environment and the privatization of the four pioneer agro-allied industries in the state have begun to attract Foreign Direct Investment (FDI) in to the state. A total of estimated N3.5 billion new investment including the De-Pacific Concrete Poles Factory and the three PVC Plastic(Injection Slippers) factories transferred to Kijawal by the Lee Group of Companies.

Indeed, given the States varied natural resources, demography, a large number of well trained and highly talented professionals and skilled labour force, the potentials for real and sustained growth are enormous. The s ta te has i n the year s demonstrated a strong political will and good governance stance which provides conducive and progressive regulatory environment for business with good investment climate providing enabling conditions for private enterprise and business compet i t i veness . The po l i cy, regulatory, legal and institutional frameworks in the state provides strong incentives for pr ivate enterprise. The Table below gives a sense of the business environment and investment climate in the state:

Rank World Bank ease of DoingBusiness 20101st Jigawa

2nd Gombe

7th Kastina

8th Kano

24th Lagos



S/N AssessmentParameters Assessment

Economic Assesment1 Transport Over 2000 kilometers of tarred road networks traversing nooks &

corners of the State; 518.5 kilometers of feeder roads linking ruralareas with major State / Federal Roads; and railway line fromNguru (Yobe State) through seven major urban towns in Jigawa Statelinking to Kano. An Airport currently under construction in Dutse witha provision of dry-port.

2 Energy National Electricity Grid traversing the State with several sub-stationsin all part; and average of 10 Hrs power supply by Power HoldingCompany of Nigeria (PHCN). Most private enterprises use privatesources of power supply to supplement PHCN Power supply. There ishowever availability of petroleum products with over 80% of the salehaving the products all the time.

3 WaterResources / Supply

Even as the State Water Policy allows for self-provision of watersupply, public water supply in the state is excellent with over 90%access to safe drinking water. Surface and Underground Water is veryexcellent.

4 Access toInformation

There is total mobile-phone coverage in the State; A state-ownedRadio Station and 10no. of Community Radio Stations with limitedCoverage. There is also a state-owned Website: jigawastate.gov.ng

Regulatory / Legal Framework5 Tax

AdministrationA simplified tax administrative system

6 Land Regulation Takes less than three months to obtain a Certificate of Occupancy;Computerized Land Management Information System; ,Governor'sconsent for transfer of Rights of Ownership within two weeks;

7 BusinessRegistration

There is a functional Corporate Affairs Office in Dutse, the StateCapital; with on-line real-time access; State Agencies withresponsibilities for Business Registration Formalities [includingMinistry of Commerce & Industry, Ministry of Lands and Due Process& Project Monitoring Bureau] takes less than five [5] working days toprocess and concludes such requests;

8 Entrepreneurship& InvestmentPromotion,Access toFinance andPublic - PrivatePartnerships

The State' policy on entrepreneurship development provides formeasures to promote entrepreneurship promotion. Access to financeby Business Enterprises is facilitated through the existence ofbranches of all financial institutions in the country including a numberof development banks. The State Government also actively supportsthe State Chamber of Commerce in undertaking InvestmentPromotion Activities. An Export Processing Zone was also establishedat the Border Town of Maigatari to support industrial clusters andpublic-private partnership. Provided in the EPZ includes proto-typeindustries, security outposts, customs and immigration services,financial institutions, etc.

Business Support



The Federal Government of Nigeria has in 1988 enacted the "The Nigerian Investment Promotion Commission (NIPC) Act" as the principal investment law. Among others, it governs entry of foreign direct investment into the country. The Act also established the Nigeria Investment Promotion Commission as an agency of the Federal Government of Nigeria charged with the responsibility to encourage, promote, and coordinate investments in Nigeria.Key provisions of the NIPC Act include:

?100% fo re ign ownersh ip o f companies in all but the petroleum sector;

?No enterprise shall be nationalized by any Government of the Federation at whatever level and

that no law can force any investor to surrender his interest;

?That while Government may acquire property under circumstances of national interest, however even under circumstances, the Law ensured that the investor is entitled to "fair, adequate and prompt compensation" and recourse to the courts if necessary;

?In cases where a dispute between the State and a foreign investor are not settled amicably, recourse to arbitration can take place either via the settlement mechanism of the bilateral or multilateral investment protection agreement of which they are parties or via other national or international dispute settlement mechanisms, as mutually agreed.

?Foreign companies are required to incorporate local subsidiaries or branches

1 - Nigerian InvestmentPromotion Commission Act

C - NATIONAL INVESTMENT LEGISLATIONAND REGULATION FRAMEWORKS

National Investment & Regulation Frameworks | 16


?Transparency in Financial Dealings including preparation of Annual Financial statements which shall be filed with the Corporate Affairs Commission (CAC).

An extant law on Foreign Exchange Dealings is the Foreign Exchange [(Monitoring and Miscellaneous] Provisions Act of 1995 which guarantees an investor the free importation and convertibility of foreign exchange into Nigeria. The Act also provides for unconditional transferability of the following:

?Net dividends or profits attributed to an investment

?Debt service payment on foreign loans

?The remittance of proceeds resulting from the sale or liquidation of an investment

Equity share capital must be brought into Nigeria through authorized dealers (banks). The remittance of dividends is permitted provided the share equity was imported. There are no restrictions on the percentage of profits that may be distributed as dividends. The remittance of interest, royalties and technical fees is permitted, provided the royalty contracts and technical fees have been approved by the National Office for Technology, Acquis it ion and Promotion. A Certificate of Capital Importation is requ i red to undertake these transactions. The Central Bank g u a r a n t e e s u n c o n d i t i o n a l transferability and repatriation of funds for Certificate of Capital Importation holders. Certificates of Capital Importation are issued by the

2 - Foreign Exchange Act

commercial bank through which the investor is importing the capital, and the investor is required to submit the following documentation:

?A formal letter of application explaining that the funds remitted to Nigeria represent the foreign investors capital contribution to the equity of the company

?A board resolution of the company of the investor authorizing the foreign investment

?A copy of the certificate of incorporation of the company

?A copy of the SWIFT message from the remitting bank

The commercial bank will issue the Certificate of Importation within 24 hours of the importation of capital (conditional upon receipt of the required documentation as detailed above

Even though the Fiscal Federalism as practiced in Nigeria has allowed for the allocation of taxation to each of the three tiers of Government (i.e. the Federal, State and Local Government levels), the operation of the Joint Tax Board provided by the Federal Income Tax Act has ensure that incidence of multiple taxation do not happen across the various tiers. Corporate income and withholding taxes, oil and gas production taxes, value added tax (VAT) and import duties are exclusively within the Jurisdiction of the Federal Government while Personal Income Tax, Capital Gains Tax, Stamp Duties, Business Registration and Road and Gaming Taxes are collected by State Governments. Local Government collects social and commercial permit fees.



3 - Corporate Taxation

4 - Transaction Taxes

Taxation of corporations is provided for under the Companies Income Tax Act. While Nigerian companies are taxed on their worldwide income, foreign companies are liable only as regards the portion of their profits attributable to businesses carried on in Nigeria. The corporate income tax rate in Nigeria for non-oil and gas companies is 30%, with the following allowances:

?Annual capital allowances (10% on buildings, 25% on plant, 20% on furniture and fittings) supplemented by subs tant i a l i n i t i a l yea r allowances, with agriculture and mining activities having especially favourable initial tear allowances. The deduction of capital allowances is capped at two thirds of annual assessable profits (with the exception of agricultural activities) and the total allowance is limited to 95% of the asset cost.

?Additional investment allowances ( r e con s t r u c t i on i n ve s tmen t allowance) of 10% are allowable on all plant and equipment.

The range of transaction taxes that apply to business enterprises in Nigeria are as follows:

?Value Added Tax [VAT] of 5% is charged as a consumption tax on the supply of goods and services. Exempt goods and services include basic foodstuffs, medicines, medical devices and medical services, educational materials, and exported goods and services. Some items are zero-rated;

?Education tax rate of 2% is payable by all resident companies;

?The Petroleum Profits Tax (PPTA) Act of 2007 also provides for the taxation of companies involved in the exploration and extraction of petroleum. Under the Act, the tax regime for exploration and production companies is set at 85%, a lower rate of 67.75% is applicable until the amortization of pre-production expenses and a rate of 50% is applied to Production Sharing Contracts (PSCs);

?Capital Gains Tax of 10% is levied on the disposal of property, while the sale of shares and stocks are exempt. Non-residents are subject to the capital gains in Nigeria only on the disposal of fixed property, held directly or indirectly, located in Nigeria;

?Stamp Duties are charged by both Federal and State Governments on various commercial and legal documents, such as transfers of deeds, insurance policies and bills of exchange;

?Withholding Tax is applicable on specified transactions and at specific rates depending on the beneficiary of the payment. The table below gives some details. Whole or partial exemptions from withholding tax exist on foreign loans depending on the tenor.



5 - Personal Income Tax

Liability to Personal Income Tax does not depend on the domicile or nationality of the tax payer. Income arising from a trade, business or profession inside or outside Nigeria is liable for income tax in Nigeria if the tax payer is a Nigeria citizen. Foreign residents are equally liable in Nigeria if their Income originates from activities in Nigeria. The applicable rates are as follows:

?Personal Income Tax rates are progressive up to 24%.

?1% of annual payroll to be paid to the Industrial Training Fund (with 60% reimbursable upon verification of performance in staff training)

?For social security, an employee must contribute a minimum of 7.5% of earnings, while the employer must make a pension contribution at a minimum of 7.5% of the employees bas ic sa lary, transport and accommodation allowance.

Law No. 5 of 2010 which establishes the Jigawa State Board of Internal Revenue empowers the State Internal Revenue

Service to be responsible for the collection and administration of personal income tax in the State. Generally, reforms in Nigeria on taxation are tending towards increasing indirect taxes and at the same time reducing direct taxes for better efficiencies. Even though the State Government is taking proactive measures to increase the efficiency of its internal revenue generation mechanisms as well as raise the level of the collection, this is being done within the context of extant Federal Laws and the purview of the Joint Tax Board which generally regulates tax matters. For instance, due recognition is given of "Double Taxation Agreement (DTAs) which Nigeria is signatory to with such countries as Nigeria has signed DTAs with Belgium, Canada, France, Pakistan and the UK. Agreements with China, South African and Sweden are awaiting ratification

6 - Visas and Entry of Foreign Workers

All Immigration issues are handled by the Nigerian Immigration Service in the Federal Ministry of Internal Affairs. While Immigration Act of 1963 is the main piece of legislation governing the entry of foreigners into Nigeria, other international protocols and bilateral

Applicable Withholding Tax by Transaction TypesS/N Type of Payments Rate for

CompaniesRate for Non-Corporate

Dividend, Interest, Rent 10% 10%1Royalties 15% 15%2All aspects of building, constructionrelated services

5% 5%3

5% 5%4

Consultancy and Professional Services 10% 5%5Management Services 10% 5%6Commissions 10% 5%7Technical Services 10% 5%8Directors Fees 10% 10%9

All types of contract and agency arrangementsother than outright sale and purchase of goodsand property



agreements also apply as in the case of ECOWAS where nationals are not subject to the residence permit processes. The Act provides for both short-term business visas and longer term work and residence permits for foreigners provided certain pre-conditions are met.

Business visitors to Nigeria must pre-apply for a business visa. Applications for business visas can be submitted at the local Nigerian mission in the visitors home country. To secure a business visa the applicant must provide evidence of the following:

?Suff ic ient funds to susta in themselves in Nigeria

?A valid return ticket

?A letter of invitation from a business organization in Nigeria stating the reason for travel and accepting immigration responsibilities of the applicant (i.e. accommodation, sustenance, transportation and repatriation costs, if required)

Business visas can be secured for between 90 days and 6 months and are not valid for employment or remuneration.

Visitors to Nigeria providing specialized services can apply for temporary work permits. The requirements are the same for the business visa, with the exception of the evidence of sufficient funds. Application for temporary work permits are submitted at the office of the Comptroller General of the Nigerian Immigration Service in Abuja.

6.1 - Business Visas

6.2 - Work and Residence Permits

Temporary work permits are not valid for more than 90 days.

Foreign investors can also apply for longer-term work permits (for up to three years) under the Expatriate Quota (EQ) scheme. Under the EQ scheme a foreign investor can apply to

hire expatriate workers to designated positions. EQ applications can be submitted at the Ministry of Internal Affairs or through the NIPC and the following are the key requirements:

?The foreign investor first secures a Business Permit (BP) and then applies for the right to hire expatriate workers for designated positions, the EQ

?The applicant completes Form 1 which requires them to list the posts for which expatriates are required, their qualifications and details of training schemes for Nigerian understudies (the EQ scheme requires that two Niger ian understudies be nominated for each designated position and that they be trained with a view to take over within three years)

?The completed Form 1 must be submitted with a receipt of payment of the form fees; the applicants Certificate of Incorporation; joint ven tu re ag reement (where app l i cab le ) ; t ax c l ea rance certificate; lease agreement for operating premises; evidence of imported machinery (form M, pro forma invoice, shipping documents, p r e - s h i p m e n t s i n s p e c t i o n documents) and details of the proposed annual salaries to be paid to expatriates.



Upon approval of the EQ application the applicant then applies for a Subject to Regularization (STR) visa for the expatriate staff they are hiring. Applications for the STF visa can be submitted at the local Nigerian mission in the expatriates home country. Upon arrival in Nigeria, the STR visa holder is eligible to obtain a work and residence permit known as the Combined Expatriate Residence Permit and Aliens Card (CERPAC), which is valid for two years. ECOWAS nationals and Free Zones are not subject to the EQ and residence permit processes.

Foreigners can also apply for Permanent Until Reviewed (PUR) status. The main reason for the granting of PUR for which a Certificate would be issued, is to enable the foreigner(s) adequately protect their interest and to give them a sense of greater commitment. The criteria and documents required for PUR are:

?Minimum share capital should be =N10 Million;

?Appreciable net profit of which not less than =N2 million has been paid as Corporate Tax;

?Certified and Detailed Audited Account and Cert i f icate of Incorporation

?Monthly Returns of Expatriate Quota

?Company Organizational Structure;

?Individual Income tax Clearance Certificate of the expatriates (original to be presented for sighting).

Other factors that would also be considered when considering PUR request include:

?Political / policy direction of Government;

?Companys area of business to fall within priority sectors of the economy;

?Evidence that PUR would guarantee Technology transfer; and

?Company should have large quota portfolio and Corresponding share holding as an added qualification;



7 - Starting a Business n Jigawa

Jigawa State performs reasonably well in the World Bank Subnational Doing Business Indicators, ranked 17 out of 36 in 2010.

Starting a business in Jigawa simply involves the following steps:



The final registration with CAC the following document/forms:

nStamped memorandum and articles of association (2 copies);

nForm CAC 3, Notice of registered address;

nForm CAC 7, Particulars of directors;

nForm CAC 4, Declaration of compliance and the prescribed registration fees;

nCopy of the reservation of company name approval;

nForm CAC 2, Statement of share capital and return of allotment of shares

Investment Incentives in Nigeria

As a matter of policy both the Federal Government of Nigeria and Jigawa State Government have both instituted a range of investment or fiscal incentives which prospective investors could take advantage of. These include import concessions, tax exemption for exported products, tax holidays and tax reductions for qual i fy ing companies, tax deductions for research and development expenses, access to free land, serviced industrial clusters, etc. Some of the specific incentives provided as a matter of Federal policy includes:



Pioneer Status

Sectoral Incentives

Pioneer status is a profits and dividends tax holiday of up to five years granted to designated pioneer industries. There are currently 69 designated pioneers industries within the agriculture, mining, manufacturing, tourism, property development and utilities sectors. A minimum capital investment of =N5 million from a foreign owned company (=N150,000 for a national company) is required to qualify for pioneer status;

A number of incentives are on offer to attract investment to the agricultural sector and these include:

?Accelerated depreciation of capital allowances (up to 95% on some assets in the first year) with deductibility on 100% of profits;

?A number of agricultural and agro-processing activities have pioneer status;

?1% duty on all agricultural machines and equipment;

?Agricultural Credit Guarantee Scheme Fund (ACGSF) administered by the Central Bank of Nigeria guarantees up to 75% of all loans made by commercial banks to agricultural related activities;

?A number of manufacturing activities qualify for the pioneer incentives;

?Manufacturers are entitled to rapid depreciation allowances and manufacturing plant and machinery rece ives a 10% investment

allowance;

?Local manufacturers of spare parts, tools and equipment supplied to local businesses or exported are also entitled to a 25% investment tax credit on their capital expenditure;

?Mining qualifies for three-year tax holiday.

The Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) also provides a window of opportunities in Jigawa State for prospective investors mainly in the area of Micro, Small and Medium Enterprises. In addition to access to capital and technical expertise, SMEDAN also engages in:

Revival of the States small-scale credit scheme so as to boost the micro smal l and med ium enterprises in the state;

?Provision of follow-up business support,

?Partnership with microfinance banks ;

?Equipment leasing and acquisition scheme;

?Capacity building;

?Facilitation of the partnership of SMEs in the State in international trade fairs and exhibitions

To compliment SMEDAN, the Central Bank of Nigeria currently working towards a =N54 billion Micro Credit Development Fund purposely for development of Micro, Small and Medium Enterprises.

SME Incentives



R&D Incentives

Incentives are available through a number of schemes to encourage firms t o u n d e r t a k e Re s e a r c h a n d Development (R&D), with incentives including:

?Up to 10% of profits set aside as a reserve for R&D qualify as allowable expenses;

?Expenditure on commercializing R&D qualifies for a 20% investment tax credit;

?100% expensing of R&D deemed to include a levy payable to a qualifying R&D institution;

?Corporate contributions to R&D carried out by universities and research institutions to be tax deductable up to a maximum of 10% of profits

Additional State Specific Incentives

Additional Incentives provided by the J igawa State Government to prospective investors in the State includes

?Access to Free Lands for investment related developments;

?Long Lease and or highly subsidized Land Compensations for allocated lands;

?Free business support services by the Jigawa State Ministry Commerce and J igawa State Investment & Properties and the Jigawa State Chamber of Commerce and Industry

?Access to free and or highly subsidized broad-band internet

services through the state-owned Galaxy ITT;



SECTORAL INVESTMENTOPPORTUNITIES IN JIGAWA

Dutse is the State Capital and is made up of the three traditional settlements of Garu, Limawa and Fagoji. Dutse is an ancient city transformed into modern residential, commercial and industrial layouts, and a growing and vibrant population of almost 250,000 (recorded in the 2006 census). It now contains five districts, each with its o w n p o t e n t i a l i n v e s t m e n t opportunities and characteristics.

? is the city centre housing the administrat ive, commercial and socio-economic activities of Dutse. It is also home to the Federal University and State polytechnics.

? provides the main commercial corridor to the entire city and state. It is home to the Mechanic Village and Modern

Fagoji district

Takur district

Market. Rasheed Shekoni specialist hospital and numerous housing estates are also located in this district.

? is the main residential district. It is undergoing extensive development, which includes the Royal Golf Course and a number of tourist attractions such as the zoological garden. Gadadin junction has been earmarked as an area for commercial development and shopping mall.

? is predominantly rock outcrop, with great potential for the development of rock procession and water processing industries.

? is another area pitched for enormous development in the coming years. It contains Dutse airport, Jigawa Stadium and Karnaya Industrial Centre.

The city has excellent infrastructure and continuing to develop extensive links to Nigeria and the West African region. The Kano-Maiduguri road links Dutse to the North West and North Eastern Nigeria, and south to the Federal Capital Abuja. Inner city roads are among the best in the federation w i t h f o u r b y e - p a s s e s u n d e r construction. The state government has set aside over 7 billion Naira for the construction of an airport in Dutse, due to be completed by the end of 2013.

The administrative and legislative buildings are all centrally located within the Malam Aminu Kano triangle with modern and fully functional facilities. The Federal University Dutse is also located in this area with over 1,000 acres of land. FUD offers a broad range of degree programs in the

Garu district

Limawa district

Fanisau districtDutse and InvestmentOpportunities

Sectoral Investment Opportunities in Jigawa | 27


Humanities, the Natural and the Social Sciences and Agriculture with new and modern amenities.

Dutse also has a number of industrial layouts, including Karanaya along Kano-Maiduguri, which is being extended to serve cargo from the new airport. There is also a smaller scale industrial layout and Danmasara Village on Huguma road. The state has invested in setting up facilities for key sectors of the economy, including a Timber Market, Mechanic Village at Danmasara, and a modern motor park at Galadanchi, and Dutse Modern Market and a Central Business District.

There is also potential investment opportunities in mining and processing mineral resources located at Gwaru, Limawa, Maai and Glamawa; these include, kaolin, clay, tin and gold.

Given the increased population and demand for housing the Jigawa State government has provided land in Dutse to private housing developers free of charge. The housing potential for the land is almost 4,000 units, with over 1000 units to Larix Estate Developers, Airbus Estate Developers and Elsalem Estate Developers.

Dutse now acts as the gateway to Jigawa offering investors great opportunities and support.



Agriculture is acknowledged to be the main economic engagement of the vast majority of the people in Jigawa State providing livelihoods for over 80% of the population. However, as reported i n the S ta te Comprehens i ve Development Framework, "despite the existence of high potentials for ma rke t - o r i en ted a g r i c u l t u r a l production, farming in the State is largely for subsistence.". Majorly, Government's concern within the sector is to facilitate an agricultural transformation in such a way that the sector significantly contributes to economic growth with poverty reduction and increased food security. This entails opening up the sector beyond subsistence, enhancing productivity through new production techniques to ensure sustained agricultural growth with agricultural value-chain development that supports increased agro-based investments that provides employment opportunities.

Agricultural Sector

Distribution of Fadama Lands byLocal Governments

S/N Local Govt. Area inHectares

1 Auyo 27,111.002 Babura 6,504.003 Birniwa 1,545.004 Birnin Kudu 16,0005 Buji 4,020.006 Dutse 6,505.007 Gagarawa -8 Garki 3,034.009 Gumel -10 Guri 70,000.0011 Gwaram 4,627.0012 Gwiwa 1,940.0013 Hadejia -14 Jahun 12,065.0015 Kafin Hausa 7,313.0016 Kaugama 23,400.0017 Kazaure 2,030.0018 Kiri Kasamma 53,650.0019 Kiyawa 10,691.0020 Maigatari -21 Malla Madori 3,500.0022 Miga 23,765.0023 Ringim 16,075.0024 Roni 4,330.0025 Sule Tankarkar -26 Taura 80,883.0027 Yank Kwashi 2,650.00

Total 381,638.00Sources: JARDA



Indeed, the potentials for an agr iculture- led soc ioeconomic transformation in Jigawa State are enormous.:

?The State has large expanse of agricultural land, rivers and flood plains suitable for crops, livestock and fish production.

?Out of about 2.24 million hectares of land area, over 1.6 million hectares consisting of upland soils, are cultivatable during the rainy season with an additional 381,000 hectares consisting of Fadama Lands and River flood-plains suitable for all-year round irrigation.

?Currently, it is estimated that less than 10% of the total Fadama lands is actually being utilized.

?J i g a w a S t a t e s e n o r m o u s comparative advantage in the production and processing of a number of crops remain largely untapped as production has also largely remained for subsistence. These include millet, sorghum, cowpea, rice, vegetables, sugar

cane, maize and gum Arabic.

?Jigawa state is also advantageous over other states due to the ease for registering land and property.

? Crops cultivation including millet, s o r g h u m , c o w p e a , b e a n s , groundnuts, sesame, rice, maize, sweet potatoes, Bambara nuts, water melon, cassava, cotton, okra, Roselle and water melon;

? Horticulture largely consisting of mango, guava, cashew, citrus, and dates, .

? Industrial Crops: Gum Arabic, Sugar Cane, Neem, Jetropha, .

? Livestock: cattle, sheep and goats and poultry

? Fisheries

The following table briefly captures existing potentials for some of the key crops

Major areas of agricultural practices include:

S/No. Crops Current Yield ObtainableYields

11-Year AverageProduction Level

(Metric Tons)

1 Rice 1.4 11.0 63,0002 Wheat 1.8 4.5 14,0003 Sorghum 0.3 2.9 182,0004 Millet 0.4 2.5 237,0005 Maize 1.2 5.5 108,0006 Groundnuts 0.4 1.7 21,0007 Sesame 0.2 1.2 75,0008 Tomatoes 10.2 25.0 102,0009 Sugar Cane 12.5 90.0 180,00010 Cotton 0.5 1.5 Less than 1,00011 Cassava 3.1 25.0 25,00012 Irish Potatoes 12.0 25.0 Less than 1,00013 Onions 11.8 20.0 27,00014 Sweet Pepper 2.2 10.0 96,000



The National policy on Agriculture provides the following incentives for the sector:-

- this comprises of waiver for various state and federal taxes for both the short-terms and long-term investors. These include:

Projects' investmentof up to $5m -10yearsProject Investmentof $5m - $15m -20yearsProject Investmentof $15 - $25m -30yearsProject Investmentof $25 - $50m - 40yearsProject Investmentof more than $50m - 50yearsTax reduction of up to 35% of the cost of producing infrastructural facilities (capitalized during the tax holding period), distributed over a five year period.

Benefits in respect of these incentives apply to both existing and prospective investors throughout the investment period. In addition to the above incentives provided by the Federal Government, Jigawa State provides the following incentives for potential and existing investors in Agricultural sector:-

pSubsidized leasing of land for agricultural production or establishment of v a l u e -a d d i t i o n a n d a g r o - a l l i e d enterpr i sesFree extens ion services;

pAccess to highly subsidized Agricultural inputs (seeds, fertilizer & veterinary d r u g s etc);

pAccess to highly subsidized warehousing faci l i t ies for agricultural inputs suppliers and

Tax holidays

?

?

?

?

?

?

Agro-dealers;

pFree Emergency Intervention on Pest/Disease outbreak on crops and

livestock;

pFree annual vaccination of all species of livestock.

This package of incentives is robust enough to support substantial private sector investments in agricultural production, processing and value-chain development.

The availability of hundreds of Government owned grazing reserves across the State offers an opportunity for investors to enter into a long term lease agreement for the utilization of these reserves as cattle/sheep/goats ranches or even large scale poultry farms. Most of the reserves are linked with all-weather roads and are close to the National power grid with mobile phone network coverage . Popu la r livestock species in the state include goats, sheep, poultry and cattle with estimated populations of 2.3 million, 1.8 million, 4.2 million and 1.1 million respectively (JARDA 1993/94 LSR).

Investment Opportunities

?LIVESTOCK PRODUCTION BUSINESS OPPORTUNITIES:



??

Tomatoes peppers and a host of other vegetables are major crops grown in the dry season under irrigation. Tens of thousands of hectares are usually produced. Dry season crops production is mainly for cash. Lack of processing facilities has been a major impediment towards full utilization of the hundreds of thousands of hectares available fory season crops production.

Acacia Senegal or gum Arabic is natural gum producing tree species commonly found in arid conditions.

Nigeria is the world's second largest producer of gum Arabic after Sudan with annual production of about 20,000 metric tons. The main production zone is the arid zone stretching from Jigawa to Yobe and Borno axis.

In Jigawa State, thousands of hectares

TOMATOES AND PEPPER PRODUCTION AND PROCESSING

GUM ARABIC PRODUCTION AND PROCESSING FOR EXPORT

of gum Arabic plantations have been developed by both the State Government and ind iv idua l s . Currently, the State Ministry for environment is producing and distributing seedlings to citizens free of charge.

Sugar cane is a long season crop that grows only on flood plains in Jigawa State due to its high water requirements. The industrial cane varieties in use were reported to have adapted to the Jigawa environment as soil and climate of the state happen to be very favorable for its cultivation. Records showed that average yields of 70 metric tons per hectare were common with good cane crop yielding over 100 metric tons per hectare. At the moment soft industrial cane varieties used as chewing cane constitutes part of the 3000 Ha currently being cultivated annual ly. With hundreds of thousands of hectares Fadama land available, Jigawa State is in the position to support large scale sugar production.

?INDUSTRIAL SUGARCANE PRODUCTION FOR SUGAR PROCESSING



?RICE PRODUCTION FOR INDUSTRIAL MILLINGRice in Jigawa State is mostly grown under flood plains scattered along river banks across the State. Construction of flood control structures along the flood flash points will allow water to be supplied to rice fields as and when needed, thereby making it possible for more land to be available, intensive varieties to be cultivated, and production to drastically increase. As earlier mentioned, the State is endowed with over 300,000 Ha of flood plains substantial part of which can be used for rice production.

With the development of about about 10,000 Ha Hadejia Valley Project under Hadejia-Jama'are River Basin Development Authority (H-JRBDA), intensive and high yielding rice varieties with high milling qualities were introduced e.g. FARO 44 and WITA 4. These varieties yield up to 10 metric tons per hectare.

Rice processing is done at cottage level using simple milling machine with limited polishing and without de-stoning. The par boiling process is not good enough either. With the proliferation of modern rice mills in the country Jigawa State is becoming a major source of paddy rice for rice mills outside the State. Establishment of modern rice mills in the State will be of benefit to both the farmers and the millers due to reduction in coordination and handling charges.



Land resources and real estate development have long been regarded as prime areas of investment in Jigawa State. As a young state, Jigawa still experiences housing deficit in the face of influx of public sector employees and other private residents.

In order to fill the gap, Government has at various times constructed housing units to cater for different categories of people ranging from state employees to private individuals. Examples include the Mallam Inuwa Dutse Housing Estate at Danmasara and Fatara Housing Estate all in Dutse Metropolis. Despite these efforts, high demand-supply gaps still remain in both residential and commercial property development.

This therefore, provides great opportunities for private real estate development. The State encourages public private partnership (PPP) in

real estate development. PPPs generally take the form of joint

ventures by signing a Memorandum of Understanding (MOU) in which the State government provides land, infrastructure as well as guarantees for repayment in the case where the off-takers are civil servants. The Real Estate developer is responsible for the following:

?Conceptual layout plans and preliminary designs

?Site appraisal and landscape plan

?Detailed site plans

?Planning Report and Environmental Impact assessment (EIA)

?Construction of the houses and all associated costs

Marketing and sales of houses

?P o s t c o n s t r u c t i o n e s t a t e

?

Real EstateDevelopment



Developers.

Reflective of this demand and the governments commitment to land and real estate development, Jigawa is ranked among the best in the nation in the ease of registering property and first in terms of dealing with construction permits.

Transforming Environmental Challenges into Opportunities

The various dimensions of climate-change or global-warming and their ramifications on socioeconomic living conditions pose huge challenges on human survival. The challenges have however, brought opportunities which so far, only the State Government is investing in. The menace of desertification, has direct negative repercussions on the energy needs of the population. This has led to the establishment of the Alternative Energy Agency (AEA) in the state with the mission to facilitate the harnessing of the available renewable energy resources for sustainable human development. The efforts of the Agency is gradually making impact on environmental protection, natural resource conservation and utilization of renewable energy for sustainable development. Most forms of the existing energy sources are detrimental to environmental sustainability. Fossil fuel consumption coupled with excessive fuel wood usage reinforce the negative trend of desert encroachment and other topographic catastrophes. The various projects executed by the State Government such as the Jetropha Planting Program, the Improved WoodEeconomy Stoves Scheme and the solar electrification of villages are all geared towards reducing the effect of environmental degradation and global warming.

The AAEA was therefore established to cater for the rising need for renewable energy sources as a means of addressing the menace of desertification attributed to the massive felling of trees for fuel wood . It is also saddled with the responsibilities of harnessing and exploiting the abundant solar energy into home lighting to supplement the persistent power shortage in the state and the country in general. In its effort to reduce the use of fuel wood and curtail the menace of desertification, the Agency has fabricated over 60,000 units of alternative energy-saving cooking stoves; 300 units of industrial size used by mass consumers of fire-wood such as boarding institutions and local bakeries. Also 26 remote villages were provided with so solar power systems consisting of Solar lighting for homes, street lights, public institutions, water schemes and vaccine refrigerators for clinics. It has also provided solar lighting back-up systems for Hospitals, Skills Acquisition Centers, Schools, Prison Yards and other Government/Public facilities. Governments investments in all these areas are "social" and is only meeting a fraction of the actual needs of the population. The economic / commercial opportunities in these areas are and are yet to be explored and tapped by private interests. Another related potential investment area is the use of bio-fuel for electricity generation

The State is keen to support real estate development through free distribution of land to private sector developers. Given the increased population and demand in Dutse land for more than 4,000 potential housing units have been given free of charge to the private sector, with over 1000 units to Larix Estate Developers, Airbus Estate Developers and Elsalem Estate



Power supply is critical for business and investment. As a matter of policy, power generation is on the concurrent list of the Nigerian Constitution, and a number of national initiatives are currently ongoing under the National Power Reform Programme. One of such initiatives is the liberalization of the issuance of licence for the generation, transmission and distribution of power. The PHCH, hitherto a state monopoly, has been unbundled into 18 private companies.These reforms have therefore opened up the sector to private investment and competition.

The liberalization of the sector presents an opportunity for Jigawa state to attract private investment in alternative sources of energy which the state has in abundance for power generation.

The Power Situation

The electricity distribution network in Jigawa State is fairly uniform across the 27 Local Government Areas. It consists of about 1000KM of 33KV and 100KM of 11KV distribution lines with over 500 distribution transformers. This distribution network is supported by four 132/33KV transmission substations; two located in the State (Dutse and Hadejia) and the other two are located in Dakata (Kano State) and Kankia (Katsina State). These are within the jurisdiction of the Kano Distribution Company (Disco), covering three states of Jigawa, Kano and Katsina. The Kano Disco is one of the eleven Distribution Companies that were recently sold to private entrepreneurs in accordance with the Electric Power Sector Reform Act, 2005. The privatized Kano Distribution Company is now owned by Sahelian Power SPV Ltd.

Power Sector



Power Sector Investment Potentials

The power sector has been liberalized and i s now open to pr ivate participation. The State has abundant potentials for renewable energy which can be harnessed to produce electricity. These include solar, wind and biofuel from Jatropha oil. With an established and mature 600ha Jatropha Plantation at Yarda Kangiwa in Kaugama L.G.A and over 2000ha of arable grazing reserves all over the State, the potential for Jatropha cultivation is quite significant.

On the average, the State enjoys twelve of solar radiation every day of the year. There is an existing State owned Alternative Energy Agency which can provide database for the solar radiation intensity and pattern for planning and design purposes. The Agency has already electrified many villages in the State using solar photovoltaic technology.

The State has also started tapping energy from wind to pump water from deep boreholes for livestock watering in some grazing reserves. Larger wind farms for electricity generation in the State are also feasible especially with the successful commissioning of the 10MW Wind Turbines in the neighboring Katsina State that geo-climatologically situates in the same wind corridor.

With the current level of generation put at less than 5000MW in a country where the power requirement is about 40,000MW; and also the carrying capacity of the transmission lines (330KV and 132KV) still at less than 6000MW, grid power will, for some time to come, remain inadequate. This is why off grid generation especially from the renewable sources of solar and wind which Jigawa State has comparative advantage, will still be attractive and competitive for potential investors.



Modern industry in Jigawa is at its infancy with three pioneer joint ventures in dairy, fruit processing and grain milling. The trade and commerce sector on the other hand is vibrant especially at the micro, informal level. Formal trade is estimated at approximately N8bn or 1% of GSP (Gross State Product) and consists of wholesale and retail activities in household consumer goods and in agro-commodities including grains, sesame, vegetables and livestock. Commercial activities are generally carried out through hundreds of regular markets all over the state as well as specialized markets at Sara, Gujungu, Maigatari, Kupsa, and Hadejia.

Jigawas geographic position provides opportunity for regional trade within the north of Nigeria, and cross border trade with neighbouring countries in both North and West Africa including through the Export Processing and

Free Trade Zones established by the Federal Government.

The Nigerian Export Processing Zones Act 1992 outlines the legal framework for investment in Nigerias Export Processing or Free Trade Zones. The Act establishes the Nigeria Export Processing Zone Authority (NEPZA) to administer and manage all free trade zones in the country. Free zone may be managed by public or private entities or a combination of both under the supervision of NEPZA. Approved free zone activities include: -

? Manufacturing of goods for export

? Warehousing, freight forwarding and customs clearance

? Handling of duty-free goods

Export Processing Zones

Commerce and Industry



? Banking, stock exchange, insurance and other financial services

? Import of goods for special service, exhibitions and publicity

? I n t e r n a t i o n a l c o m m e r c i a l arbitration service

? Other activities deemed appropriate by NEPZA

A minimum investment of US$500,000 is required by approved enterprises to undertake these activities in the free zones. Approved Free Zone enterprises can take advantage of incentives including the following:

? Up to 100% foreign ownership of business;

? Exemption from all federal, state and local government taxes, levies and rates;.

? Exemption from all federal, state and local government taxes, levies and rates;.

? Duty free import of capital equipment, machinery, raw material components and spare parts;

? Freedom from legislative provision pertaining to taxes, levies duties and foreign exchange regulation;

? Repatriation of foreign capital

investment at any time with the capital appreciation of the investment;

? Unrestricted remittance of profits and dividends earned by foreign investors;

? No import or export licenses required in the zone;

? Rent free land at construction stage, thereafter rent shall be set by the investment management authority;

? Liberalized regime for employment of expatriate

The decision to establish the Border Free Zone at Maigatari town was dictated by the strategic location of the town along the Nigeria-Niger boarder, its historic role in regional livestock marketing and as trans-shipment point along the ancient Trans-Saharan trade route. The free zone was licensed in 2000 by NEPZA and was envisaged to cover a total of 6.5 square kilometers with robust and modern infrastructures to support and sustain both light, medium and heavy manufacturing industries targeting the export market. The first phase of the zone covering a total of 2.3 square kilometer enclave is 85% completed. Facilities available include ten prototype factory buildings complete

The Maigatari Export Processing Zone



with the associated road networks and drainages, electricity and water supply network ready for outright lease to potential investors.

Other services/facilities available include the following:-

? Utilities - Electricity HT lines covering the 2.3 square kilometers and LT line covering all the developed areas as mentioned above and the street line. There are three (3No.) transformers (two 350KV and one 500KV) and there are two (nos.) standby generating sets of 350 and 500KVA. The water requirements of the ten prototype buildings and their support infrastructures are provided by the three boreholes drilled and reticulated to all the areas;

? Banking facilities

? Hotel Accommodation;

? Container terminal,

? Modern industrial Clinic,

? Block of lettable offices;

? Security Services including Customs and Immigration Services and Police Posts;

The establishment of the export processing zone is intended:

1. To provide easy access to Niger Republic and other landlocked countries in the West African sub-region.

2. To promote the development of export-oriented activities and attracting foreign investment given the incentives and facilities made available at the free zones.

3. To generate wealth and create employment opportunities, provide sustainable means of livelihood and reduce poverty among the populace.

The Major Markets Development / Modernization Programme of the state involves the provision of modern and critical infrastructures; such as road network, drainages, electrifications, quasi-public facilities and services; such as public convenience, shopping mall and stalls, warehouses, animal pens, motor park, and social and security facilities such as Police and Fire Services station, Clinics and Mosques in the 8 major markets of the state namely; Gujungu, Maigatari, Sara, Hadejia, Shuwarin, Furji, Kumsa and Babura. The objectives are :

? To provide enabling environment and structures for rapid economic growth and development;

? To provide an easy access to market by both domestic and foreign investors;

? To engineer the private sector to be more productive and relevant by contributing their own quota toward developing commercial activities in the state via private participation;

? To provide a clear mindset in the commercial sector of the economic by inducing the private sector to actively participate and contribute in providing employment to Jigawa State indigenes thereby reducing the rate of unemployment in the state;

Other Policies for the Promotion of Commerce

Major Markets Development



? To boosts the revenue generation activities by encouraging private sector to contribute their own quota in the economy thereby reducing the dependency on oil sector;

? To modernize the market by providing infrastructure to compete with other similar modern markets in other states.

As part of the governments deliberate policy of encouraging private sector led economic development strategy, a p u b l i c p r i v a t e p a r t n e r s h i p implementation strategy was adopted.

The state government is committed to the provision of critical and modern



Jigawa state is blessed with abundant Solid Minerals deposit capable of feeding medium to large scale industries for optimum industrial operation. Previous work conducted by t h e S t a t e M i n e r a l Re s o u r c e Development Agency and Jigawa State Investment and Property Development Company Limited revealed the existence of various solid mineral deposits which when effectively harnessed would improve the economic status of the state and its people in general. These deposits include among others:

Varieties of beautiful granites of different colors and texture that are chemically and physically tested and found most suitable for granite tile production exist in the most southern part of the state especially in Dutse, Birnin Kudu and Gwaram Local Governments.

Granite for Dimension Stone:

Tin and Colombite:

Iron Ore Deposits:

In Nigeria tin and columbite have been found to be associated with the younger granite rocks which is tin bearing. The weathering, transportation and deposition of tin from the younger granites have risen to the alluvial tin deposition of Nigeria. It is also worthy to note that some of these granites contain appreciable quantity of tin and a there is also primary tin deposit which are found in pegmatite veins around these granites. Collected tin sample on reacting with HCL (Hydrochloric Acid) with zinc dust give effervescence and the tin sample turns from black to grey color. This denotes excellent quality of tin deposit;

A prefeasibility study within an area of 700 square meters was conducted. The iron ore out crops to the surface having a maximum height of 0.4m. Within an area of 700 square meters the

Solid Minerals Sector



superficial out crop iron ore revealed 4,097. 12 tones. However this could not reveal appreciable information on the extent of the iron ore occurrence. Hence detail work must be carried out to determine the extent of the iron ore reserve over the vast area of deposition;

Kaolin is used for industrial production in Paper Industry, Ceramic Industry, Cement Pharmaceuticals, Rubber and Plastic Industry, and textiles. The reserve estimate of industrial grade kaolin in Jigawa over an area of 14.4km2 stands at 1,278,773,70 tones. With an annual production of 38,400 tones it put the life span deposit at approximately 24 years.

Kaolin:

Soda Ash (Trona): Trona exist in the eastern part of Jigawa state in lakes and salt plays in the arid region of the state. Reserve Estimates of Soda Ash in various locations around the State is up to 20 million tons. It is generally used for Pharmaceuticals; Textiles; Leather works; Glass production; and Soap & Detergent production.



Baturiya Birds Sanctuary Tourist Base Camp - This is a wetland area covering more than 320sqkm. It provides a natural habitat for more than 370 species of migratory birds mostly from Europe. In addition to birds sanctuary, the area is rich in cultural activities which when carefully harnessed will attract tourism investors to the state. In addition to road network to the area, Government ha s p roduced a conceptual drawing for a tourist base camp which will provide decent accommodation and recreational facilities to visitors. The Tourist base camp will include round hut and d o r m i t o r y a c c o m m o d a t i o n , restaurant, outdoor recreational facilities, open air theater and multi -purpose hall for seminar and conference;

Tourism Development

Jigawa state tourism industry is growing while Jigawa itself is endowed with abundant tourist attraction sites, numerous cultural festivals and traditional sports, which are being systematically developed for maximum impact on economic growth, poverty reduction and, increased employment opportunities. Government overall policy objective in this sector is the creation of an investor-friendly environment anchored on the principle of public private partnership through the provision of robust tourism and hospitality infrastructures including road networks across the state Hotels, hostels, eateries and other modern recreational facilities. The current administration has established the Hotels and Tourism Board a machinery for the development, promotion, and regulation of tourism businesses in Jigawa state.

Prominent among the tour ist attractions in Jigawa are:


Wawan Rafi Lake Holiday Resort

Birnin Kudu Rock Paintings

Horse Racing Stadium Gumel

- Wawan rafi is a fresh water lake located in the outskirt of kazaure town. It covers an area of more than 200 meter square and a sand beach stretching more than 500 meters. The site has since being recognized as a potential tourist centre. Because of its economic and social potentialities, government has intended to construct a holiday resort which will comprise of round hut accommodation, golf course, out door recreational facilities, open Air theatre, restaurant, and a conference hall;

- These are unique cultural heritage blessed to the people of Birnin Kudu. The paintings were since declared a national monument by the national commission on museums and monuments. Because of the global recognition of the sites as a tourist centre, Government has sought for private investors participation in the provision of additional tourist facilities in order to meet the increasing demand by both residents and visitors. The proposed project will include landscaping of the sites, construction of exhibition hall, outdoor seating facilities, umbrella shades, conveniences, information and snack kiosks.

- Horse racing sport is an event attraction which brings people of different nationality, race, religion, and cultural background to compete with their animals in a running speed. Government recognizes the need to involve individual and corporate investors in promoting unity, friendliness, mutual understanding, and cooperation between people and nations, Government has proposed a stadia for tourism investors which will consist of pavilions, race track,

stables, paddock, horse treatment c e n t e r, s o u v e n i r s h o p s a n d conveniences.

the political capital of Jigawa has a beautiful natural rock scenery that is attractive to visitors but is lacking in world class hospitality and recreational facilities. Dutse metropolis is currently served by a three-star rated hotel and the need for more and higher rated hospitality infrastructure cannot be over-emphasized, given the increasing demand for leisure and recreational facilities by residents and visitors. . Government has proposed a site near the 3 Star Hotel for, and welcomes private sector participation in the construction of a modern amusement park. The park will consist of folk village, children amusement facilities, aqua plant garden, mini zoo, outdoor recreational facilities snack and souvenir shops.

- The concept of a fishing village is to create a center near a pond where traditional fishing festival and cultural celebrations are periodically organized. This activity will enhance economic

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